Post-Mortem of the OM Token Crash: What Happened and What We Can Learn

KEYTAKEAWAYS

TABLE OF CONTENTS

• KEY TAKEAWAYS
• TIMELINE OF EVENTS
• MARKET RESPONSE AND AFTERMATH
• BROADER IMPACT
• LESSONS AND REFLECTIONS
• CONCLUSION
• DISCLAIMER
• WRITER’S INTRO

CONTENT

OM is the native token of Mantra DAO, a Layer 1 blockchain focused on the tokenization of Real World Assets (RWA)—such as real estate and data centers. The project aims to bring traditional assets on-chain through blockchain technology.

Since its launch in August 2020, OM gradually gained traction. In 2024, driven by the RWA narrative, OM’s price surged dramatically—from $0.0158 at the beginning of the year to a high of $9 by early 2025. At its peak, the token’s market cap reached nearly $6 billion.

However, on April 13, 2025, OM suddenly collapsed. In just one hour, the price plummeted by more than 90%, dropping from $6.3 to $0.37. Over $5.5 billion in market value evaporated, causing widespread panic and debate across the crypto community.

TIMELINE OF EVENTS

April 11–12: Suspicious On-Chain Activity

According to Arkham Intelligence and several blockchain analysts, a series of large OM token transfers occurred shortly before the crash.

• One wallet, possibly linked to early investor Laser Digital, transferred approximately $41 million worth of OM to OKX.

• Another wallet received $36 million in OM from Binance on March 21 and then moved around 4.3 million OM to OKX in eight batches on April 12.

• Another address, possibly associated with Middle Eastern capital such as a Shorooq Partners executive, received a transfer of 2 million OM shortly before the crash.

These transactions raised alarms. Many speculated that insiders might have had prior knowledge of the coming selloff.

April 13 (17:20–18:50 UTC): The Flash Crash

According to The Block and CoinMarketCap:

• Around 17:20 UTC, OM’s price declined about 10%, from $6.21 to $5.21.

• Between 18:20 and 18:50 UTC, the price sharply dropped to $0.37—a crash of more than 90% within 90 minutes.

• Trading volume during this window surged to nearly $700 million, far above daily averages.

During the crash:

• Mantra’s Telegram group temporarily disabled new member access.

• Community members received no clear explanation.

• A community manager said they were still investigating the cause, which only deepened uncertainty and fear.

April 13–14: Official Responses

Mantra CEO and co-founder John Patrick Mullin posted a statement on X (formerly Twitter), blaming the crash on “reckless forced liquidations” by centralized exchanges. He emphasized that neither the Mantra team nor its early investors were responsible for selling.

He also noted that the crash occurred during a low-liquidity window—Sunday night UTC—implying either a failure in exchange risk management or potential manipulation.

Mantra’s official account followed up with a statement reaffirming that the project’s fundamentals remain strong and that the team has not sold any tokens. They promised a full investigation and committed to transparency. Mullin also stated that all team tokens are still locked, and provided a wallet address for public verification.

Meanwhile, OKX CEO Star Xu called the event a serious scandal and promised to release detailed on-chain data including all deposits, unlocks, and liquidations. Binance’s CZ also commented, saying centralized exchange risk controls need to be reviewed.

MARKET RESPONSE AND AFTERMATH

After the crash, OM rebounded slightly to about $0.73 as of April 14 (UTC). While this marked a near 100% recovery from the low, the price was still down 87% from pre-crash levels.

On-chain activity revealed that a Mantra DAO staking wallet transferred 38 million OM (worth approximately $27 million) to Binance’s cold wallet. This move reignited fears of further selling pressure.

The community response was deeply divided. Some accused the team of manipulating the market or engaging in OTC dumping. Comparisons were even drawn to the 2022 Terra LUNA collapse, with some calling OM “LUNA 2.0.”

One anonymous analyst claimed the team had sold 90% of the circulating supply and accused them of deleting the Telegram group to hide evidence—allegations that Mantra denied.

Mantra later announced that it would hold a community AMA on X to address questions and reveal which exchanges were involved in the liquidation events.

BROADER IMPACT

Investor Losses

• Many retail investors reported heavy losses, with some claiming they lost everything.

• Institutional players such as Laser Digital may also have suffered significant losses if they failed to exit in time.

• OM futures saw over $75 million in liquidations during the crash.

Reputation Damage

Mantra had recently gained visibility through partnerships with Google Cloud, DAMAC Group, and regulatory approval from Dubai’s VARA. However, the crash severely damaged its public image. Trust in the project plummeted.

Additionally, Mantra’s treasury was heavily concentrated in its own token. With 99.7% of reserves held in OM, the treasury’s value dropped to around $1.9 million post-crash.

Industry Impact

• The RWA narrative suffered a major blow. The total sector market cap dropped to around $35 billion.

• Other RWA-related projects, such as Chainlink, were also affected.

• The incident renewed scrutiny of centralized exchanges and their risk control mechanisms. Regulators may be prompted to tighten oversight.

LESSONS AND REFLECTIONS

This event highlights not only the volatility of crypto markets but also the structural risks within tokenomics and the centralized elements of DeFi ecosystems.

For Investors

Be cautious of tokens with high FDV and low circulating supply. These are prone to manipulation. Always assess actual float and unlock schedules—not just market cap.

Focus on fundamentals, not hype. OM’s valuation was far above its actual usage and DeFi metrics. Evaluate a project’s user adoption, financial transparency, and product development.

Diversify your portfolio and manage risk. Avoid going all-in on a single asset. Use stop-loss orders and be cautious with leverage.

Don’t rely solely on community sentiment. During crises, verify facts using on-chain data and official sources rather than following unverified social media narratives.

CONCLUSION

The OM token crash was the result of multiple overlapping issues: insider concentration, low liquidity, suspicious transactions, poorly managed liquidations, and lingering doubts about team behavior.

It was not just a price drop—it was a crisis of trust.

For investors, this is a hard reminder: the crypto market offers great opportunities, but also extreme risks. Chasing narratives without doing proper due diligence can lead to devastating losses.

CoinRank x Bitget – Sign up & Trade to get $20!