Key Takeaways
- MANTRA DAO’s OM token dropped more than 90% during early Monday trading hours.
- The project blamed centralized exchanges for “reckless” forced liquidations.
- Exchange executives pointed fingers at project insiders for offloading large token volumes.
The price of MANTRA DAO’s OM token collapsed more than 90% early Monday morning, wiping out hundreds of millions of dollars in market value and sending shockwaves through the broader crypto community.
OM wasn’t alone. A cascade of sharp losses hit several other tokens, including ACT, TST, MASK and LEVER, sparking panic, finger-pointing and renewed scrutiny of the murky relationship between token issuers and centralized exchanges (CEXes).
“Reckless” Liquidations or Insider Dumping?
In a statement, the MANTRA DAO team blamed the crash on a wave of forced closures and liquidations triggered by centralized exchanges during low-liquidity Sunday evening trading hours.
“We have determined that the OM market movements were triggered by reckless forced closures initiated by centralized exchanges on OM account holders,” the team’s founder, John Patrick Mullin, said. “The timing and depth of the crash suggest that a very sudden closure of account positions was initiated without sufficient warning or notice.”
The team emphasized there was no rug pull, as some community members had alleged, and called for better internal and external oversight of centralized exchange operations, saying their unchecked power can “hurt projects and investors alike.”
Yet that’s not the only version of the story circulating.
Executives from major exchanges, including OKX and Binance, offered a competing explanation: insiders dumped tokens on the open market.
Suspicious Wallet Activity Raises Flags
On-chain data revealed that 17 wallets deposited 43.6 million OM tokens—an estimated $227 million—shortly before the crash. That single move represented roughly 4.7% of the token’s circulating supply, raising immediate red flags.
According to blockchain analytics firm Arkham, two of those wallets were linked to Laser Digital , a strategic investor in MANTRA Chain. While no proof of wrongdoing exists, many observers believe these actions may have triggered the token’s steep fall.
Even before this week’s collapse, critics had questioned MANTRA DAO’s governance. Crypto commentator Colin Wu flagged concerns in 2021 , citing the project’s alleged ties to online gambling platform 21Pink and its core team’s connections to the space.
The project also faced backlash for falsely claiming investment from FTX, which the now-defunct exchange later denied.
Centralized Exchanges Respond
OKX CEO Star Xu described the situation as a “big scandal” and pointed out that on-chain unlock and deposit data are public, allowing exchanges to investigate any irregularities.
Binance, which has had a volatile relationship with the OM token, said it implemented risk control measures as early as October, including reducing leverage on OM-related trading pairs.
Despite these steps, some argue that CEXes could have, and should have, done more to prevent this kind of meltdown. Others say the real issue lies within the project’s tokenomics.
A Fragile Foundation?
According to reports , the MANTRA team controls as much as 90% of the OM token supply, meaning the token’s price and liquidity are at the mercy of a small group of stakeholders.
Insiders have also been accused of working with market makers to artificially maintain price levels, quietly altering the token’s economics, and repeatedly delaying a community airdrop that had been promised.
The result is a volatile cocktail of mistrust, opaque decision-making and questionable liquidity, one that has left retail investors bearing the brunt of Monday’s collapse.
As exchanges begin their investigations and the MANTRA team defends its position, the episode has reignited old concerns about transparency and accountability in crypto, particularly when the lines between centralized control and decentralized ideals are blurred.
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