Why Did the Mantra (OM) Token Crash Over 90% in a Day?

• Blockchain Council
• April 21, 2025

On April 10, 2025, the Mantra (OM) token lost over 90% of its value within hours, dropping from $6.12 to under $0.50. This flash crash erased more than $5 billion in market capitalization and triggered panic across the crypto community.

The cause? A perfect storm of centralized exchange liquidations, alleged insider activity, and extreme token concentration—magnified by a lack of liquidity and confidence.

Here’s everything you need to know about what happened, what the Mantra team said, and whether this token can recover from one of the biggest single-day crashes of the year.

What Is the Mantra (OM) Token?

Mantra (OM) is the native token of Mantra Chain, a Layer 1 blockchain focused on tokenized real-world assets (RWAs) and regulated DeFi infrastructure.

In Q1 2025, OM gained significant traction thanks to:

• Announced partnerships in Hong Kong and the UAE
  
• Strong performance in the RWA narrative
  
• A successful mainnet launch
  

By early April, OM had reached an all-time high above $6, with major trading volume on centralized exchanges like Binance, KuCoin, and Gate.io.

What Caused the 90% Crash in OM Token?

The OM token collapse was not caused by a smart contract exploit or technical bug. Instead, it stemmed from a combination of market-driven events that spiraled out of control.

1. Centralized Exchange Liquidations

According to the Mantra team, the crash was triggered by “reckless liquidations” on centralized exchanges. Traders holding high-leverage long positions were auto-liquidated as prices dipped slightly, causing a cascade effect.

Due to low order book depth during off-peak trading hours, each liquidation drove the price further down, leading to more forced sales.

2. Wallet Activity From Team-Linked Addresses

On-chain data revealed that wallets associated with the Mantra team or early investors deposited large amounts of OM to exchanges just hours before the crash. These deposits raised questions about whether insider selling contributed to the price collapse.

While the team denied selling any vested tokens, the optics and timing led to intense criticism across social platforms.

3. Token Concentration and Low Float

Mantra’s tokenomics showed that a majority of OM tokens were still locked, meaning actual circulating supply was very low. This meant that relatively small sell orders could have an outsized impact on price.

Combined with low liquidity, token concentration created a fragile market structure vulnerable to even modest sell pressure.

OM Token Crash – Timeline of Key Events

What Did the Mantra Team Say?

The official Mantra X (Twitter) account released a statement shortly after the crash:

“This was not the result of any protocol-level vulnerability. No team or investor tokens were sold. Reckless liquidations during low-liquidity conditions caused this anomaly.”

They also claimed all team/investor tokens remain locked under a strict vesting schedule.

However, blockchain analysts and community watchdogs contested this, showing linked wallets making timely deposits to exchanges, creating a gap between the official narrative and observable blockchain activity.

Mantra (OM) Token Distribution Before the Crash

Was This a Rug Pull or a Market Fluke?

There’s no proof of an outright rug pull, but the situation has all the signs of a badly structured market combined with questionable token flows.

Factors include:

• Poor liquidity management
  
• Poorly designed leverage products on CEXs
  
• Team communication failures
  
• Token hoarding followed by sudden selling pressure
  

While technically not a scam, the result was devastating for regular holders.

Is OM Recoverable After the Crash?

Since the crash, OM has shown mild signs of stabilization, but confidence remains low. The team has announced a revised liquidity strategy, including:

• Deeper exchange order books
  
• Improved risk metrics for exchange listings
  
• More transparent token release disclosures
  

Still, OM’s reputation is damaged, and recovery will depend heavily on:

• How transparent the Mantra team is moving forward
  
• Institutional and RWA partnerships delivering results
  
• Community support and DAO governance
  

Should You Still Invest in OM?

If you’re considering exposure to high-risk, RWA-focused chains like Mantra, it’s critical to:

• Track wallet activity using on-chain tools
  
• Understand token distribution and unlocks
  
• Avoid FOMO trading on leveraged CEX pairs

This incident underscores the need for real crypto education. A Crypto Certification can help you analyze token fundamentals, track smart money flows, and avoid falling into similar traps.

Conclusion

The 90% crash of the Mantra (OM) token in a single day was a result of centralized exchange liquidations, insider-linked wallet activity, and a lack of liquidity support. While not an outright rug pull, it exposed severe weaknesses in tokenomics, market structure, and communication.

For crypto investors, this serves as a powerful reminder: the most dangerous part of the market isn’t the tech—it’s the human behavior behind it.

Stay informed. Stay cautious. And never trade without understanding the game.