Mantra has found itself at the cener of a major crypto controversy after its OM token plummeted over 90% within a matter of hours, with the project’s team blaming forced liquidations by centralized exchanges for the dramatic drop.
In a shocking turn of events late Sunday into early Monday, OM fell from over $6 to just $0.40 during low-liquidity trading hours. The collapse triggered widespread panic and speculation in the crypto community, with some comparing it to the infamous Terra LUNA implosion. However, Mantra was quick to defend its fundamentals, stating that the event had nothing to do with the project itself.
Mantra Team and Co-founder point to reckless forced liquidations
In a public statement posted on X, Mantra reassured its community that the core of the project remains strong and that the dramatic drop was not due to internal issues.
“We want to assure you that Mantra is fundamentally strong,” the team wrote. “Today’s activity was triggered by reckless liquidations, not anything to do with the project. One thing we want to be clear on: this was not our team.”
Over $50 million in long OM futures positions were liquidated during the crash, marking a record for the token. Open interest fell sharply from $345 million to just $130 million.
John Patrick Mullin, Mantra’s co-founder, echoed the sentiment and blamed centralized exchanges for triggering forced closures of OM positions without adequate warning. He also suggested that some exchanges may have engaged in intentional market positioning to exploit the event.
“The timing and depth of the crash suggest that a very sudden closure of account positions was initiated without sufficient warning or notice,” Mullin wrote. “We believe these were reckless forced closures by centralized exchanges.”
OKX responds as Mantra scrambles to rebuild trust
Amid growing scrutiny, OKX founder Star Xu added fuel to the fire by confirming that over $220 million in OM tokens had been deposited on exchanges just before the collapse. He called the event a “big scandal” and committed to publishing full on-chain data and collateral reports.
“All major exchanges’ collateral and liquidation data can be investigated. OKX will make all of the reports ready,” Xu stated.
Despite the explanations, many in the crypto space remain skeptical. Some community members and analysts questioned whether Mantra’s token unlock schedules or liquidity management contributed to the crash. Calls for third-party audits and regulatory investigations have grown louder.
Before the turmoil, Mantra had been riding high. In January 2025, it formed a strategic partnership with UAE’s DAMAC Group to tokenize $1 billion in real-world assets, including real estate, hospitality, and data centers. OM had surged over 400% in 2024, gaining attention for its quiet but powerful rally.
Now, as Mantra promises to investigate and release more information, the crypto community watches closely. The incident is a harsh reminder of the risks tied to forced liquidations and the concentration of power within centralized exchanges—an issue the industry has yet to fully address.
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Lewis Murithi is a seasoned writer with four years of experience in crypto blockchain news, guides, press predictions, and analysis. with a deep understanding of market trends and emerging technologies, Lewis delivers insightful content that keeps readers informed about the ever-evolving crypto landscape. their experience lies in breaking down complex block chain concept,providing accurate forecasts, and offering in-depth press analysis to help both beginners and seasoned investors navigate the industry".
