Key Takeaways
- MANTRA plans to burn team tokens following OM’s price crash.
- OM token plunged over 90% on April 14.
- MANTRA blamed centralized exchanges for “reckless” forced liquidations.
The team behind MANTRA DAO is preparing to burn a large portion of its token holdings to calm investors and restore trust after the price of OM, the project’s native token, collapsed spectacularly.
OM plunged more than 90% on April 14, erasing hundreds of millions of dollars in value and creating panic across the crypto market.
The damage didn’t stop there—tokens like ACT, TST, MASK and LEVER also tumbled, fueling speculation of insider activity and drawing renewed attention to the uneasy relationship between token issuers and centralized exchanges.
As the dust settles, MANTRA is trying to reassure its community. However, confidence remains fragile with rumors of internal selling and finger-pointing between exchanges and project teams.
Mantra To Burn Team Tokens in Bid To Regain Trust
MANTRA CEO John Mullin announced that he plans to burn 300 million OM tokens—allocated initially to the project’s team—to restore community confidence.
In a post on X dated April 15, Mullin said the tokens, which were not set to begin vesting until 2027, will now be permanently removed from circulation.
“The team’s token allocation is vesting only starting in 2027, 30 months from the mainnet launch (Oct. ’24),” he wrote. “I’m planning to burn all of my team tokens, and when we turn it around, the community and investors can decide if I have earned it back.”
The 300 million tokens, representing roughly 16.9% of OM’s 1.78 billion total supply, were previously reserved for MANTRA’s team and early backers, with a phased release originally scheduled through October 2029.
The decision to burn them follows a Coffeezilla interview in which Mullin admitted that team members sold between $30 million and $45 million worth of OM over the counter before the crash.
He also acknowledged that the team injected around $10 million worth of tokens into circulation after a tokenomics change in late 2024—an act critics say contributed to a pump-and-dump scenario.
While Mullin denied any intention to inflate OM’s price, Coffeezilla noted that such a sudden increase in supply may have had the same effect.
MANTRA Collapse Timeline
“Reckless” Liquidations or Insider Dumping?
The MANTRA DAO team blamed the crash on a wave of forced closures and liquidations triggered by centralized exchanges during low-liquidity Sunday evening trading hours.
“We have determined that the OM market movements were triggered by reckless forced closures initiated by centralized exchanges on OM account holders,” the team’s founder, John Patrick Mullin, said. “The timing and depth of the crash suggest that a very sudden closure of account positions was initiated without sufficient warning or notice.”
The team emphasized there was no rug pull, as some community members had alleged, and called for better internal and external oversight of centralized exchange operations, saying their unchecked power can “hurt projects and investors alike.”
Yet that’s not the only version of the story circulating then.
Executives from major exchanges, including OKX and Binance, offered a competing explanation: insiders dumped tokens on the open market.
Suspicious Wallet Activity Raises Flags
On-chain data revealed that 17 wallets deposited 43.6 million OM tokens—an estimated $227 million—shortly before the crash. That single move represented roughly 4.7% of the token’s circulating supply, raising immediate red flags.
According to blockchain analytics firm Arkham, two of those wallets were linked to Laser Digital, a strategic investor in MANTRA Chain. While no proof of wrongdoing exists, many observers believe these actions may have triggered the token’s steep fall.
Critics had questioned MANTRA DAO’s governance before this collapse.
Crypto commentator Colin Wu flagged concerns in 2021, citing the project’s alleged ties to online gambling platform 21Pink and its core team’s connections to the space.
The project also faced backlash for falsely claiming investment from FTX, which the now-defunct exchange later denied.
Centralized Exchanges Respond
OKX CEO Star Xu described the situation as a “big scandal” and pointed out that on-chain unlock and deposit data are public, allowing exchanges to investigate irregularities.
Binance, which has had a volatile relationship with the OM token, implemented risk control measures as early as October, including reducing leverage on OM-related trading pairs.
Despite these steps, some argue that CEXes could have, and should have, done more to prevent this kind of meltdown. Others say the real issue lies within the project’s tokenomics.
A Fragile Foundation?
According to reports, the MANTRA team controls as much as 90% of the OM token supply, meaning the token’s price and liquidity are at the mercy of a small group of stakeholders.
Insiders have also been accused of working with market makers to artificially maintain price levels, quietly altering the token’s economics, and repeatedly delaying a community airdrop that had been promised.
The result is a volatile cocktail of mistrust, opaque decision-making, and questionable liquidity, which has left retail investors bearing the brunt of Monday’s collapse.
As exchanges begin their investigations and the MANTRA team defends its position, the episode has reignited old concerns about transparency and accountability in crypto, particularly when the lines between centralized control and decentralized ideals are blurred.
Prashant Jha is a seasoned crypto journalist based in Delhi, India, with a Bachelor’s Degree in Computer Science Engineering. Passionate about the evolving world of blockchain and cryptocurrencies, he has been a dedicated voice in the industry since 2018. Prashant’s expertise lies in regulatory reporting, where he unravels complex legal and financial developments with clarity and precision. Before joining CCN in 2024, he honed his craft at Cointelegraph, establishing himself as a trusted name in crypto journalism.
His coverage spans major industry events, including the high-profile collapses of FTX, Three Arrows Capital (3AC), and LUNA, offering readers insightful analyses of their regulatory and market implications. Prashant’s technical background enables him to bridge the gap between intricate blockchain technology and its real-world applications, making his work accessible to novices and experts.
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