- The Mantra (OM) token crashed over 90% in two hours on April 14, 2025, wiping out billions in market value without a clear catalyst.
- Suspicions of insider selling, manipulative tokenomics, and weak fundamentals (low TVL vs. high market cap) have emerged. The Mantra team denied responsibility, but vague responses fueled distrust.
- The crash raises doubts about an altcoin rally in 2025, as macro conditions and shaken investor confidence dim prospects for an alt season.
Introduction
The cryptocurrency market is no stranger to volatility, but the recent crash of the Mantra (OM) token stands out as a particularly dramatic event. In just two hours, OM’s price plummeted over 90%, erasing billions in market value and leaving investors stunned (Coinmarketcap, 2025). This article delves into the details of the crash, the responses from key figures, potential causes, and the broader implications for the altcoin market.
What Happened to Mantra on April 14th, 2025?
Built on the promise of decentralized governance and staking solutions, OM had climbed into the top 100 cryptocurrencies by market cap, boasting a valuation in the billions. Its community was vibrant, its partnerships were growing, and its price had reached an impressive $6.3. Then, on April 14, starting at 2:00 am (UTC+8), disaster struck. Within two hours, OM’s price crashed to $0.38—a jaw-dropping decline of over 90%. Although it later stabilized around $0.88, the damage was done.
What made this collapse so perplexing was the lack of an obvious catalyst. No major hacks, regulatory announcements, or negative project updates preceded the drop. The timing—during low-liquidity overnight hours—only deepened the mystery. The broader crypto market felt the ripples, with other altcoins experiencing heightened volatility, though major players like Bitcoin and Ethereum remained relatively unscathed.
This event wasn’t just a financial loss—it was a wake-up call about the fragility of altcoin markets and the need for vigilance.
Official Responses from All Parties
In the aftermath, the Mantra team issued a statement denying any role in the crash. They attributed the plunge to “reckless liquidations” beyond their control and insisted that the project’s fundamentals—its technology, roadmap, and community—remained intact. However, their vague explanation failed to quell skepticism. No follow-up audits or detailed reports were promised, leaving a cloud of doubt hanging over the team.
The crypto community’s reaction was polarized. Some praised the Mantra team’s resilience, clinging to hopes of a recovery, while others accused them of dodging accountability. Calls for on-chain audits and regulatory scrutiny grew louder, reflecting a broader frustration with opaque practices in DeFi.
Possible Methods Used by the Mantra Team for Large-Scale Selling
The Mantra (OM) team’s approach to orchestrating large-scale selling appears to rely on a sophisticated blend of psychological manipulation, tokenomics control, and strategic timing, as implied by the translated text.
1. Crafting a Compelling Narrative to Attract Investment
The Mantra team likely began by constructing a glamorous story to lure investors, presenting OM as a revolutionary project backed by prestigious partnerships and regulatory legitimacy. By claiming ties to a UAE real estate giant and aligning with Islamic finance laws, they dressed up an otherwise speculative token in a veneer of credibility. This narrative acted like a high-end brand label, drawing in both retail investors and larger players eager to capitalize on tokenized real estate in Dubai. However, the disconnect between the project’s modest on-chain activity (millions in TVL) and its inflated valuation (billions) suggests this was a deliberate overpromise—a tactic to create hype and inflate perceived value before any selling began.
2. Controlling Supply and Demand Through Tokenomics
To maintain price control and set the stage for profitable exits, the team may have designed OM’s tokenomics to limit circulating supply while creating an illusion of scarcity. Techniques like high-yield staking rewards encouraged investors to lock up their tokens, reducing sell pressure and keeping prices elevated. Simultaneously, token-burning mechanisms with each transaction shrank the available supply, fostering a perception of increasing value. By allegedly using fake accounts to simulate trading activity, the team could have fabricated liquidity and demand, propping up prices artificially. This tight grip on 90% of the token supply allowed them to manipulate price movements, creating dramatic rallies (like the reported 440x surge) to entice more buyers before a planned sell-off.
3. Building a Loyal Community to Delay Selling Pressure
The Mantra team seemingly leveraged community dynamics to sustain momentum and delay retail selling, which could disrupt their exit strategy. Through emotionally charged rhetoric—phrases like “vision” and “shakeout”—they fostered a cult-like loyalty, discouraging doubt and framing price dips as opportunities. Technical indicators were manipulated to project unstoppable growth, while tying price pumps to broader market narratives (e.g., Bitcoin ETF inflows) kept investors hooked. This environment turned skeptics into outcasts and reinforced a gambler’s mindset among holders, ensuring they clung to tokens even as warning signs mounted, giving the team ample time to prepare their exit.
4. Executing a Precision Sell-Off at the Optimal Moment
The final act likely involved a carefully timed sell-off to maximize profits while minimizing accountability. Choosing a low-liquidity window, such as 2 AM Asian time, ensured minimal resistance from institutional traders or active retail investors. By targeting a period when exchanges had weaker oversight, they could exploit market vulnerabilities. The team may have anticipated the community’s tendency to “buy the dip,” leading to a leveraged long-position bloodbath—97% of liquidations reportedly hit bullish traders. Preemptive token transfers to major exchanges by insiders suggest they positioned themselves to dump tokens before the crash, blaming external factors like exchange liquidations to deflect scrutiny. This orchestrated collapse allowed them to cash out at peak prices, leaving retail investors to bear the losses.
Mantra’s On-Chain Data Has Long Shown Hidden Dangers
The Mantra (OM) team’s alleged strategies for orchestrating large-scale token sales, as suggested by on-chain data and community speculation, reveal a calculated approach to market manipulation.
1. Coordinated Wallet Movements for Strategic Dumps
One possible tactic involves leveraging multiple wallet addresses to execute timed token sales, creating the illusion of organic market activity. On-chain evidence points to significant transfers.
According to Lookonchain, since Apr 7, at least 17 wallets deposited 43.6M $OM ($227M at the time) into exchanges, around 4.5% of the circulating supply. Based on Arkham’s info, 2 of these addresses are linked to Laser Digital, a strategic investor in Mantra. Additionally, a staking contract’s sudden $5.84 million withdrawal aligned perfectly with the downturn. These synchronized moves suggest the Mantra team—or affiliated entities—could have used a network of wallets to offload tokens at optimal moments, maximizing profits while deflecting blame onto “market volatility.” By spacing out these transactions and using intermediaries like exchanges, they could obscure their involvement, making it appear as though unrelated actors were driving the sell-off.
Source: Arkham Intelligence
2. Airdrop Manipulation as a Liquidity Trap
Another method likely centered on the airdrop campaign, designed to inflate hype and trap retail investors into holding tokens during orchestrated dumps. Initially, the team promoted a generous “20% unlock upon listing,” enticing 300,000 participants to spread the word organically. However, mid-campaign, they altered the terms to a stingier “10% initial release with three-year vesting,” locking participants into long-term commitments. This shift ensured that retail investors couldn’t sell en masse, preserving liquidity for the team’s larger sales. Later, by freezing accounts under the guise of combating “sybil attacks,” the team could have selectively eliminated dissenting or unprofitable participants, consolidating control over the token’s distribution. This bait-and-switch tactic turned the airdrop into a tool for immobilizing retail supply, allowing insiders to sell without immediate downward pressure from smaller holders.
3. Low TVL Fails to Justify OM’s Multi-Billion Dollar Market Cap
Before its price plummeted, OM boasted a market capitalization of approximately $6 billion. However, its Total Value Locked (TVL) was a mere $4 million—a stark contrast that raises serious questions about its valuation (DefiLlama, 2025). To put this into perspective, it’s akin to a global car giant like Tesla, valued at hundreds of billions, having only a few hundred cars in circulation in an underdeveloped region. Such a low TVL simply cannot support a multi-billion dollar market cap by any reasonable measure.
Source: DefilLama
The glaring mismatch between OM’s TVL and its market cap suggests that its lofty valuation may have been an unsustainable mirage. A project’s TVL is a critical indicator of its ecosystem’s strength and adoption, and OM’s figures fall far short of justifying a $6 billion valuation. This imbalance casts doubt on the project’s fundamentals, suggesting that its market cap was more a product of inflated expectations than grounded economic reality.
Will There Be an Altcoin Season in 2025?
The Mantra crash has reverberated beyond its immediate victims, casting a dark cloud over the altcoin market and raising doubts about the prospects of an “alt season” in 2025. Alt seasons—periods when alternative cryptocurrencies enjoy widespread rallies—have historically depended on specific conditions, most notably a flood of liquidity from macroeconomic policies. In today’s climate, however, those conditions appear increasingly out of reach, and the Mantra incident may signal a deeper malaise.
Past alt seasons have often coincided with aggressive monetary stimulus, such as the Federal Reserve’s quantitative easing during the 2020 pandemic. These policies injected vast sums into the economy, encouraging speculative investments in risk assets like altcoins. In 2025, however, the macro environment tells a different story. President Trump’s high-profile tariff war has introduced volatility into global markets, threatening economic growth and dampening investor risk appetite. Meanwhile, the Federal Reserve has adopted a cautious stance, hesitating to commit to interest rate cuts or large-scale money printing amid concerns about inflation and stability. Without this liquidity boost, the fuel for an altcoin rally is conspicuously absent.
The Mantra crash adds another layer of complexity. If, as suspected, the collapse stemmed from insider dumping, it may reflect a broader trend among altcoin projects. Faced with a lack of short-term growth prospects, project teams and large holders might opt for rugpull-like tactics—cashing out now rather than waiting for an uncertain future boom. This behavior could suppress the market further, as trust erodes and capital flees to safer assets like Bitcoin or traditional investments. The Mantra incident, in this sense, might not be an isolated event but a harbinger of a more conservative, risk-averse crypto landscape.
Investor sentiment is also shifting. The crash has amplified skepticism about altcoins, particularly those with murky tokenomics or concentrated ownership. As confidence wanes, money may flow away from speculative projects and toward established cryptocurrencies with stronger fundamentals. This flight to quality could stifle the broad-based gains needed for an alt season, reinforcing a cycle of stagnation. While it’s too early to rule out a 2025 rally entirely, the combination of macroeconomic headwinds and shaken trust makes it a long shot. The Mantra crash may well mark a turning point, signaling the end of an era of unchecked altcoin exuberance.
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Conclusion
The Mantra (OM) token collapse serves as a stark reminder of the risks lurking in the altcoin market, where hype can outpace fundamentals and trust is easily shattered. While the exact cause remains murky, the incident exposes vulnerabilities like concentrated token control, inflated valuations, and opaque practices that can devastate investors. For the broader crypto ecosystem, this crash may signal a shift toward caution, with capital likely gravitating to safer assets amid unfavorable macro conditions. Investors would be wise to prioritize transparency, robust fundamentals, and diversified strategies—such as stable options like CoinEx Financial Account—to navigate the uncertainty and safeguard their portfolios in this volatile landscape.
References
- Coinmarketcap. (2025). Cryptocurrency Market Capitalizations | CoinMarketCap. CoinMarketCap. https://coinmarketcap.com/currencies/mantra/
- DefiLlama. (2025). DefiLlama. https://defillama.com/chain/mantra
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