Is OM the LUNA of this cycle? Uncovering the dark history of MANTRA: market manipulation, legal disputes, and the 0TC model
This sudden crash is not just a technical issue; it feels more like a long-buried bomb has finally exploded.Author: Fairy, ChainCatcher
Editor: TB, ChainCatcher
"This is even worse than LUNA."
In the early hours of today Beijing time, a sudden crash kept many crypto investors awake all night. The MANTRA token OM dropped about 10% in just one hour, then plummeted from $5.21 to $0.50 in a cliff-like drop of up to 90%.
Amidst the uproar, the community sharply commented: "There are still many people holding OM for interest, and they didn't even have time to escape. This is more deadly than the flash crash of LUNA back in the day."
This sudden crash is not just a technical issue; it seems more like a long-buried landmine finally detonating.
"Heavy 'Black History'? Uncovering the Controversial Past of MANTRA"
In the Web3 world, it is not uncommon for project valuations to deviate from fundamentals, but when a DeFi protocol has a TVL of only $4 million yet boasts a fully diluted valuation (FDV) of up to $9.5 billion, it is hard not to raise questions about its rationality.
The collapse of MANTRA may not be without signs, as it has been filled with various controversies and unsavory pasts in recent years:
Project team has high control. Crypto analyst Mosi stated that MANTRA controls most of the circulating supply of $OM. The project team has concentrated as much as 90% of $OM (792 million tokens) in a single wallet address.
An endless cycle of token relay games. Crypto KOL Rui pointed out that the underlying logic of OM resembles a carefully packaged OTC funding game. It is said that over the past two years, OM has raised more than $500 million through OTC sales via ground promotion. Its operation involves continuously issuing new OTC tokens to absorb the selling pressure from previous investors, forming a cycle of "new replacing old, old exiting new." 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 "takes profits" in every round of price increases, obtaining additional profits by opening contracts and coordinating with market surges.
Middle Eastern capital acquiring project shell. According to Ye Su, in 2023, OM's FDV once fell below $20 million, and the project was nearly abandoned. Subsequently, through intermediaries, a Middle Eastern capital acquired the OM project, retaining only the original CEO while replacing the rest of the team. This Middle Eastern capital has an extremely rich portfolio of mansions, resorts, and various RWA assets, packaging OM as an RWAfi concept project. With the popularity of RWA themes and high control methods, OM achieved over 200 times growth in 2024.
Involved in legal disputes, accused of asset misappropriation. According to the South China Morning Post, the Hong Kong High Court once required six members of MANTRA DAO to disclose relevant financial information due to accusations of misappropriating DAO assets.
Defaulting on numerous promised fees and tokens. Crypto KOL Phyrex stated that he participated in the project investment years ago but has never received the promised tokens. Even after winning a lawsuit in 2023, the MANTRA team has not executed the court ruling, claiming they "have moved from Hong Kong to the United States." He accused, "Not a single cent or token has been given."
Airdrop operations heavily criticized. According to reports from Ice Frog, the MANTRA project team frequently modified rules from the early stages of airdrop activities, gradually delaying the token unlocking schedule, ultimately leading to users' expectations for airdrops being repeatedly dashed. During the airdrop distribution phase, the project team lacked transparency and consistently adopted a cold treatment towards community doubts, even implementing a "witch trial" style of withdrawal mechanism, depriving users of airdrop eligibility under the pretext of "Sybil attacks," without ever disclosing specific judgment criteria or data.
Unraveling the Truth of the Collapse: Forced Liquidation Storm and Big Holder Exodus
After the OM price experienced a cliff-like drop, quickly triggering panic and doubts in the community, the MANTRA team urgently spoke out within hours, attempting to clarify that the project team had no direct relationship with the severe market fluctuations. Various analyses and speculations have circulated regarding this crash. The triggers can be roughly summarized as follows:
Forced liquidation causing market fluctuations
According to MANTRA co-founder JP Mullin, the severe fluctuations in the OM market were caused by reckless forced liquidations of OM account holders by centralized exchanges. He pointed out that the liquidation of these account positions occurred very suddenly, without sufficient prior warning or notification.
Data shows that in the past 12 hours, the OM crash led to over $66.97 million in forced liquidations, with 10 positions having liquidation amounts exceeding $1 million.
Strategic investors exiting in large amounts
According to Lookonchain monitoring, before the OM crash, at least 17 wallets transferred 43.6 million OM (worth about $227 million at the time) to exchanges, accounting for 4.5% of the circulating supply. Among them, two wallet addresses were associated with MANTRA's strategic investor Laser Digital.
Additionally, according to Spot On Chain monitoring, 19 wallets suspected to belong to the same entity transferred 14.27 million OM (about $91 million) to OKX at an average price of $6.375 in the three days prior to the OM crash. As early as late March, these wallets had purchased 84.15 million OM from Binance, spending about $564.7 million at an average price of $6.711. These wallets may have hedged some positions on other platforms, exacerbating the situation of this crash.
The 90% drop of OM once again verifies the harsh reality of the "harvesting logic" in the crypto market. OM is not the first project to encounter this fate, nor will it be the last. In the crypto industry, where trends and bubbles coexist, maintaining vigilance and rational investment is essential to steadily navigate the complex and ever-changing market environment.
