Mantra OM Token Crashes 90%: Insider Allegations & Exchange Scandal Explained

Key Points:

• Mantra's OM token plunged 90% on April 13 and 14, 2025, erasing over $5 billion in market value, triggering allegations of insider selling and exchange-driven liquidations.
  
• Blockchain analytics showed that 43.6 million OM tokens were moved onto exchanges just before the crash; key investors Laser Digital and Shorooq Partners publicly denied involvement.
  
• Mantra CEO John Mullin rejected insider trading accusations, attributing the crash to "reckless forced liquidations" by centralized exchanges, while promising a comprehensive token burn program.
  
• Binance and OKX provided conflicting accounts: Binance cited "cross-exchange liquidations," whereas OKX described the incident as a major scandal and promised a detailed investigation.

OM Token Plunges Overnight

Between late April 13 and early April 14, 2025, the OM token of Mantra—a blockchain platform that focuses on tokenizing real-world assets (RWAs)—fell sharply from approximately $6.30 to around $0.40. The sudden plunge triggered over $50 million in forced liquidations of OM-linked futures, according to CoinDesk.

Open interest—a measure of total unsettled futures contracts—declined from about $345 million to roughly $130 million, suggesting a swift withdrawal by leveraged traders. The collapse occurred amid typically low-liquidity hours, which exacerbated price volatility.

Large Token Transfers Raise Concerns

In the lead-up to the crash, data from Arkham Intelligence indicated unusual activity involving substantial token transfers. Approximately 43.6 million OM tokens—around 4.5% of the total circulating supply—moved from 17 wallets onto cryptocurrency exchanges between April 11 and April 13, 2025.

Notably, wallets reportedly linked to Laser Digital, a digital asset subsidiary of Japanese financial giant Nomura, accounted for 8.7 million OM tokens transferred to Binance and OKX exchanges shortly before the crash.

These transfers that occurred during periods of low trading activity amplified selling pressure, driving the market downward rapidly.

Investors Deny Insider Selling Allegations

Laser Digital firmly denied involvement, calling reports suggesting insider selling incorrect. The company described the large OM token transfers as “routine collateral repayments,” related to a financing arrangement.

Shorooq Partners, another major investor associated with Mantra, also publicly denied selling tokens. In an effort to show that the transfers involved were purely wallet-to-wallet rather than to an exchange, Shorooq founding partner Shane Shin also published the company’s wallet information.

Mantra Team Points to Forced Liquidations

John Patrick Mullin, Mantra’s co-founder and CEO, firmly rejected allegations of insider involvement."I don't know who those wallets belong to. I know they don't belong to Shorooq. I know they don't belong to Laser. I know they don't belong to our key institutional partners," Mullin said in an online discussion hosted by Cointelegraph.

He attributed the token’s collapse to reckless forced liquidations executed by centralized exchanges, claiming these exchanges abruptly closed OM token positions held by traders without sufficient warning.

Varied Reactions from Exchanges 

Major cryptocurrency exchanges have offered mixed responses.

Binance suggested that the crash resulted from cross-exchange liquidations, a scenario wherein forced selling in one marketplace rapidly triggers liquidations in another.

Meanwhile, Star Xu, founder of the OKX exchange, characterized the crash as "a big scandal," referring specifically to suspicious token deposits exceeding $220 million that occurred shortly before OM’s price collapsed. Xu promised complete transparency and investigations into OKX’s data on collateral and liquidation mechanisms.

Comparisons to Terra Crash Deemed Misleading

Social media quickly drew comparisons between Mantra’s OM token crash and the infamous 2022 Terra Luna collapse. Although the price charts look visually identical, industry experts emphasize that the two events are fundamentally different.

According to Ben Yorke, Vice President at Woo, Terra’s failure was structural, as it was caused by the collapse of its algorithmic stablecoin. The plunge of the OM token, by contrast, was potentially the result of mismanagement or poor liquidity handling rather than protocol-level failure, Yorke said in an interview with Cointelegraph.

Mantra's Response Includes Comprehensive Token Burn

As part of its damage control strategy, Mantra CEO John Mullin announced plans for a "comprehensive token burn."

That means permanently removing tokens from circulation to stabilize or increase their price.

In his public statement on April 16, 2025, Mullin explicitly committed to burning tokens allocated to his personal team, as well as portions from the treasury, to restore investor confidence. The details of the burn program are forthcoming in a promised incident report, which is anticipated within 24 hours.

Broader Implications for Tokenization Projects

The OM token crash brings to light broader risks associated with asset tokenization, such as concentrated ownership, low liquidity periods, and opaque token unlock schedules.

For institutional investors, this case serves as a good reminder of the importance of transparency, diligent governance, and prudent liquidity management.

Next Steps Awaited

Investors and observers are awaiting Mantra’s detailed post-mortem report, expected shortly. Exchanges have also committed to releasing comprehensive liquidation data to help clarify the precise causes behind the sudden market collapse.

Until these reports are available, unanswered questions regarding insider activity, liquidity management, and governance transparency will remain central concerns for stakeholders across the crypto and asset tokenization industries.

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