Mantra’s OM Token Crash Sparks Alarms Over Weekend Liquidity and Insider Activity
Crypto Community Faces Fresh Concerns After Sudden 90% Token Plunge
In another jarring episode for the crypto markets, Mantra’s OM token plunged by over 90% in a single day, revealing deep vulnerabilities in the ecosystem’s liquidity and governance structures. The incident, which unfolded on Sunday, April 13, has drawn intense scrutiny from analysts, investors, and exchange leaders alike.
Sudden Crash During Low-Liquidity Hours
The OM token dropped precipitously from around $6.30 to under $0.50, triggering widespread speculation about market manipulation and insider dumping.
According to Gracy Chen, CEO of leading exchange Bitget, the crash revealed multiple red flags plaguing the broader digital asset industry.
“The OM token crash exposed several critical issues, not just for Mantra, but for the industry as a whole,” said Chen on Cointelegraph’s Chainreaction daily show.
Chen explained that high wealth concentration, opaque governance, and sudden token movements on centralized exchanges during illiquid periods created the “perfect storm” for the crash.
$227 Million Worth of OM Tokens Moved Before Crash
Blockchain analytics firm Lookonchain, citing Arkham Intelligence, reported that 17 wallets, including those linked to investor Laser Digital, moved a total of 43.6 million OM tokens—valued at $227 million—to exchanges ahead of the crash.
These transactions, carried out just before the token’s collapse, have raised serious concerns about insider dumping.
However, Mantra CEO John Mullin denied allegations of internal wrongdoing and asserted that the project itself did not sell tokens. In a statement issued on April 16, Mantra said they were continuing to investigate the crash but did not clarify the reason for the large token transfers or the wave of liquidations that followed.
A Familiar Pattern in the Industry
The situation bears resemblance to other market-wide patterns. According to Chen, OKX was the main exchange accused of handling the forced liquidations, though no conclusive evidence has yet been provided.
“Millions of OM tokens being sent to centralized exchanges is a very strong signal of insider dumping,” Chen emphasized, after analyzing on-chain data.
The OM crash is not an isolated case. Even Bitcoin (BTC) experienced significant weekend price drops, as seen on April 6, when it fell below $75,000 amid geopolitical tensions. This, analysts say, underscores the impact of 24/7 crypto trading in contrast to traditional markets closed on weekends.
An Urgent Call for Stronger Crypto Risk Measures
While the Mantra team continues to investigate, the event serves as a stark reminder of the crypto market’s fragility, especially during off-peak hours. With investor trust at stake, there is growing pressure on projects and exchanges to improve transparency, enhance governance, and address liquidity issues—particularly on weekends.
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