Mantra's OM Token Plunges 90% Amid Exchange Closures

Mantra, the blockchain behind real-world tokenized assets, has attributed the sudden 90% plunge in its native token OM to the actions of centralized exchanges. On April 13, the price of OM dropped from $6.30 to below $0.50, resulting in a significant loss of its market cap.

John Mullin, co-founder of Mantra, stated that the drastic market movements were triggered by reckless forced closures initiated by centralized exchanges on OM account holders. He highlighted that the timing and depth of the crash suggested a sudden closure of account positions without sufficient warning or notice.

Mullin further noted that the incident occurred during low-liquidity hours on a Sunday evening UTC, which corresponds to early morning in Asia. This timing raised concerns about negligence or intentional market positioning by the exchanges involved.

While Mullin did not name the specific exchange responsible, he clarified that it was not Binance. He mentioned that Mantra is still investigating the details and plans to share more information during an upcoming community connect event.

Speculations among traders included allegations of a rug pull or the Mantra team using their tokens as collateral for a massive loan from a centralized exchange, leading to a margin call. Mullin denied these theories, asserting that the team did not have an outstanding loan and had not orchestrated a rug pull. He emphasized that the tokens remain locked and subject to published vesting periods, with the tokenomics intact.

Following the collapse, the price of OM briefly recovered above $1 but has since dropped back down to around $0.7894. The token had reached an all-time high of nearly $9 on February 23, representing a decline of over 91% from that peak.

Blockchain analytics platforms reported significant movements of OM tokens in the week leading up to the collapse. Spot On Chain noted that some OM whales moved 14.27 million tokens to the crypto exchange OKX three days before the crash. In March, these whales had acquired 84.15 million OM for $564.7 million, resulting in an estimated loss of $406.3 million after the 90% drop.

Lookonchain also reported that since April 7, at least 17 wallets deposited 43.6 million OM into crypto exchanges, representing 4.5% of the circulating supply. These movements suggest potential hedging or contributions to the sharp drop in OM's value.

Mantra's recent developments include a $1 billion deal with investment conglomerate DAMAC to tokenize various assets and the receipt of a virtual asset service provider license from Dubai’s Virtual Assets Regulatory Authority. These initiatives underscore Mantra's commitment to real-world asset tokenization and decentralized finance (DeFi).