Mantra shocked investors on Sunday with an unprecedented dip. The asset plummeted from $6.25 to a low of $0.38. It slightly recovered and closed at $1, but its losses exceeded 83%.
The asset is still on the decline, dropping by over 30% on Monday, with prices struggling around $0.70. While its previous recovery slightly raised traders’ expectations of a possible rebound to its previous price levels, the ongoing price struggles had a reverse effect.
Many reactions followed the dip as investors voiced their displeasure over the ongoing trend. Most were not optimistic and blamed the OM team for the decline. The CEO has not claimed responsibility for any of the allegations. Instead, he blamed the centralized exchanges for the massive dips.
A few hours ago, a co-founder said, “OM market movements were triggered by reckless forced closures initiated by centralized exchanges on OM account holders.” They blamed the exchange for closing these positions during “low-liquidity hours on a Sunday evening UTC” and added that it was a plot to crash the token.
Users’ comments on the statement varied. While some said they believed the token would bounce back, others demanded more proactiveness from the team, telling them to mention the exchanges that forced the closures.
Will Mantra Recover?
Some investors are counting their losses already, saying OM just had a rugpull and may never recover. Others continue to bemoan the situation while remaining hopeful.
Many analysts who paid close attention to the drama as it unfolded claimed that the token had some red flags. The first event that caught attention was the 3.9M OM transferred to OKX on Sunday. Suspicion of insider trade stems from this transaction, as the Mantra team controls 90% of the total supply. Traders suspected that the large transfer may be a ploy to crash prices.
Commenting on the transaction, Mishael Nwani, an editor at Cointab Media, said this may be the nail in the coffin, as the asset’s movement suggests insider trades. He added that OM may be LUNA 2.0 for this reason.
The editor’s comment may not be far from the truth as the token’s team made other moves that may have broken investors’ trust. They did an airdrop and allegedly blocked 50% of the wallets that received it, claiming they were bots. Allegations of market makers keeping prices high surfaced and the team reportedly made some quiet changes to tokenomics, worsening the damage.
There are further allegations that Mantra sold to private investors following the 3.9M move, causing a chain reaction: large holders sold, retailers sold, derivatives plummeted, and liquidations hit.
Numerous events led to a lack of trust in the project. Rebuilding such trust may take an extended period.
Will OM Be The Next LUNA?
Terra retraced from over $120 in April 2022 to almost zero. Many blamed the CEO for the crash. The founder blamed Binance for the dip as the exchange sold some of its bags before the decline.
Mantra may be following the same path as it failed to claim responsibility for the situation, pointing to exchanges as the culprit. Although LUNA rebranded, it continues its struggle to break above $2.
Commenting on the similarities, Agozie Jonathan, a writer at Cointab Media, said, “OM may resemble Luna in its price crash, but not in what caused it or the level of risk involved. Luna collapsed due to a flawed stablecoin system, while Mantra’s drop appears tied to market hype and sell-offs, not a core failure.”
It is worth noting that the most recent crash was a smaller disaster than Terra. However, the similarities remain inseparable. Concerning price, OM is currently stable at $0.71. The team’s damage control bid may be taking effect. The question remains, “For how long?”
It will slip further in the coming days if the team fails to come up with a remedy.
