"This is even worse than LUNA."

Early this morning, Beijing time, a sudden market crash kept many crypto investors up all night. The MANTRA token OM plunged by about 10% within just one hour and then crashed dramatically from 5.21to0.50, a drop of up to 90%.

The community was in an uproar, with sharp criticism: "There are still plenty of people holding OM for interest, and they didn't even have time to exit. This is even more fatal than the flash crash of LUNA back then."

This sudden market crash is not just a technical issue but more like a long-buried bomb finally detonating.

"Zeroing Out" Shocks the Market: Uncovering MANTRA's Dark History of Market Manipulation, Legal Disputes, and Ground-Level OTC Practices

Heavy "Dark History"? Uncovering MANTRA's Controversial Past

In the Web3 world, it's not uncommon for project valuations to deviate from fundamentals. However, when a DeFi protocol's Total Value Locked (TVL) is only 4millionbutboastsaFullyDilutedValuation(FDV)of9.5 billion, it's hard not to raise questions about its rationality in the market.

MANTRA's collapse may not have come out of nowhere. The project has been plagued by numerous controversies and unsavory past incidents in recent years:

1. Heavy Market Manipulation

Crypto analyst Mosi states that MANTRA controls a significant portion of OM's circulating supply. The project team has concentrated up to 90% of OM tokens (792 million) in a single wallet address.

2. An Infinite Loop of Token Relay Games

Crypto KOL Rui points out that the underlying logic of OM resembles a well-packaged OTC fund game. Over the past two years, OM has reportedly raised over $500 million through ground-level OTC sales. Its operation involves issuing new OTC tokens to absorb the selling pressure from previous investors, creating a cycle of "new tokens replacing old ones, and old ones generating new ones." Once liquidity dries up or unlocked tokens can no longer be absorbed by the market, the entire system may collapse.

The project team itself also "cashes out" during each rally, earning additional profits by opening contracts and collaborating with the market to drive up prices.

3. Acquisition by Middle Eastern Capital

According to Ye Su, OM's FDV fell to less than $20 million in 2023, and the project was on the verge of abandonment. Subsequently, through the mediation of intermediaries, a Middle Eastern capital firm acquired the OM project, retaining only the original CEO and replacing the rest of the team. This Middle Eastern capital firm, with extensive holdings in luxury homes, resorts, and various RWA assets, packaged OM as an RWAfi concept project. Leveraging the popularity of RWA themes and high market manipulation tactics, OM achieved over 200x growth in 2024.

4. Involvement in Legal Disputes

According to the South China Morning Post, the Hong Kong High Court ordered six members of MANTRA DAO to disclose relevant financial information due to allegations of misappropriation of DAO assets.

5. Unpaid Commitments and Tokens

Crypto KOL Phyrex revealed that he invested in the project early on but never received the promised tokens. Even after winning a lawsuit in 2023, the MANTRA team failed to execute the court judgment, citing the reason that "they had moved from Hong Kong to the United States." He complained, "They haven't paid a dime of the owed money or tokens."

6. Criticized Airdrop Practices

According to Ice Frog, MANTRA's project team has frequently modified rules and gradually postponed token unlock schedules since its early airdrop activities, ultimately leading to repeated disappointments among users. During the airdrop distribution phase, the project team lacked transparency, consistently ignored community questions, and even implemented a "witch hunt"-style expulsion mechanism, stripping users of their airdrop eligibility under the pretext of "Sybil attacks" without disclosing specific criteria or data.

Dissecting the Collapse: Margin Call Turmoil and Large Investor Exit

After the dramatic plunge in OM's price triggered panic and questions from the community, the MANTRA team issued an emergency statement within hours, attempting to clarify that the project team was not directly related to the market volatility. Various analyses and speculations circulated in the market regarding this crash, which can be broadly attributed to the following two points:

Margin Calls Trigger Market Volatility

According to MANTRA co-founder JP Mullin, the sharp fluctuations in the OM market were caused by reckless margin calls on OM account holders by centralized exchanges. He pointed out that these margin calls were executed very suddenly without sufficient prior warning or notification.

Data shows that over 66.97millioninmargincallsweretriggeredbytheOMcrashinthepast12hours,with10positionsliquidatedforover1 million each.

Strategic Investors Make Large Exits

According to Lookonchain's monitoring, at least 17 wallets transferred 43.6 million OM (worth approximately $227 million at the time) to exchanges before the OM crash, accounting for 4.5% of the circulating supply. Two of these wallet addresses were associated with MANTRA's strategic investor Laser Digital.

Additionally, Spot On Chain's monitoring revealed that 19 wallets suspected to belong to the same entity transferred 14.27 million OM (about 91million)toOKXatanaveragepriceof6.375 within three days before the OM crash. These wallets had previously purchased 84.15 million OM from Binance in late March, spending approximately 564.7millionatanaveragepriceof6.711. These wallets may have hedged some positions on other platforms, exacerbating the crash.

The 90% crash in OM once again validates the cruel reality of the "harvesting logic" in the crypto market. OM is not the first project to suffer such a fate, nor will it be the last. In the crypto industry, trends and bubbles coexist. Staying vigilant and investing rationally is the key to navigating the complex and volatile market environment.

"This is even worse than LUNA."

Early this morning, Beijing time, a sudden market crash kept many crypto investors up all night. The MANTRA token OM plunged by about 10% within just one hour and then crashed dramatically from 5.21to0.50, a drop of up to 90%.

The community was in an uproar, with sharp criticism: "There are still plenty of people holding OM for interest, and they didn't even have time to exit. This is even more fatal than the flash crash of LUNA back then."

This sudden market crash is not just a technical issue but more like a long-buried bomb finally detonating.

"Zeroing Out" Shocks the Market: Uncovering MANTRA's Dark History of Market Manipulation, Legal Disputes, and Ground-Level OTC Practices

Heavy "Dark History"? Uncovering MANTRA's Controversial Past

In the Web3 world, it's not uncommon for project valuations to deviate from fundamentals. However, when a DeFi protocol's Total Value Locked (TVL) is only 4millionbutboastsaFullyDilutedValuation(FDV)of9.5 billion, it's hard not to raise questions about its rationality in the market.

MANTRA's collapse may not have come out of nowhere. The project has been plagued by numerous controversies and unsavory past incidents in recent years:

1. Heavy Market Manipulation

Crypto analyst Mosi states that MANTRA controls a significant portion of OM's circulating supply. The project team has concentrated up to 90% of OM tokens (792 million) in a single wallet address.

2. An Infinite Loop of Token Relay Games

Crypto KOL Rui points out that the underlying logic of OM resembles a well-packaged OTC fund game. Over the past two years, OM has reportedly raised over $500 million through ground-level OTC sales. Its operation involves issuing new OTC tokens to absorb the selling pressure from previous investors, creating a cycle of "new tokens replacing old ones, and old ones generating new ones." Once liquidity dries up or unlocked tokens can no longer be absorbed by the market, the entire system may collapse.

The project team itself also "cashes out" during each rally, earning additional profits by opening contracts and collaborating with the market to drive up prices.

3. Acquisition by Middle Eastern Capital

According to Ye Su, OM's FDV fell to less than $20 million in 2023, and the project was on the verge of abandonment. Subsequently, through the mediation of intermediaries, a Middle Eastern capital firm acquired the OM project, retaining only the original CEO and replacing the rest of the team. This Middle Eastern capital firm, with extensive holdings in luxury homes, resorts, and various RWA assets, packaged OM as an RWAfi concept project. Leveraging the popularity of RWA themes and high market manipulation tactics, OM achieved over 200x growth in 2024.

4. Involvement in Legal Disputes

According to the South China Morning Post, the Hong Kong High Court ordered six members of MANTRA DAO to disclose relevant financial information due to allegations of misappropriation of DAO assets.

5. Unpaid Commitments and Tokens

Crypto KOL Phyrex revealed that he invested in the project early on but never received the promised tokens. Even after winning a lawsuit in 2023, the MANTRA team failed to execute the court judgment, citing the reason that "they had moved from Hong Kong to the United States." He complained, "They haven't paid a dime of the owed money or tokens."

6. Criticized Airdrop Practices

According to Ice Frog, MANTRA's project team has frequently modified rules and gradually postponed token unlock schedules since its early airdrop activities, ultimately leading to repeated disappointments among users. During the airdrop distribution phase, the project team lacked transparency, consistently ignored community questions, and even implemented a "witch hunt"-style expulsion mechanism, stripping users of their airdrop eligibility under the pretext of "Sybil attacks" without disclosing specific criteria or data.

Dissecting the Collapse: Margin Call Turmoil and Large Investor Exit

After the dramatic plunge in OM's price triggered panic and questions from the community, the MANTRA team issued an emergency statement within hours, attempting to clarify that the project team was not directly related to the market volatility. Various analyses and speculations circulated in the market regarding this crash, which can be broadly attributed to the following two points:

Margin Calls Trigger Market Volatility

According to MANTRA co-founder JP Mullin, the sharp fluctuations in the OM market were caused by reckless margin calls on OM account holders by centralized exchanges. He pointed out that these margin calls were executed very suddenly without sufficient prior warning or notification.

Data shows that over 66.97millioninmargincallsweretriggeredbytheOMcrashinthepast12hours,with10positionsliquidatedforover1 million each.

Strategic Investors Make Large Exits

According to Lookonchain's monitoring, at least 17 wallets transferred 43.6 million OM (worth approximately $227 million at the time) to exchanges before the OM crash, accounting for 4.5% of the circulating supply. Two of these wallet addresses were associated with MANTRA's strategic investor Laser Digital.

Additionally, Spot On Chain's monitoring revealed that 19 wallets suspected to belong to the same entity transferred 14.27 million OM (about 91million)toOKXatanaveragepriceof6.375 within three days before the OM crash. These wallets had previously purchased 84.15 million OM from Binance in late March, spending approximately 564.7millionatanaveragepriceof6.711. These wallets may have hedged some positions on other platforms, exacerbating the crash.

The 90% crash in OM once again validates the cruel reality of the "harvesting logic" in the crypto market. OM is not the first project to suffer such a fate, nor will it be the last. In the crypto industry, trends and bubbles coexist. Staying vigilant and investing rationally is the key to navigating the complex and volatile market environment.