Mantra (OM): Anatomy of a crash
The crypto world is infamous as an industry where you go to bed a millionaire and wake up to a margin call.
The crypto world is infamous as an industry where you go to bed a millionaire at night and wake up to a margin call. This is how it happened to many investors in Mantra (OM) last Monday morning, when the token suddenly shed 90% of its value. What does the future look like after this crash?
The name ‘Mantra’ is meant to project trust and calm. “Mantras give people peace and inner calm,” Mullin said in Paris. That was also the idea behind MantraDAO and the OM token: a stable counterweight in a crypto market plagued by hacks and scandals.
Until recently, that seemed to work too. While many altcoins lost ground in late February, OM rose to a new all-time high. For some that was proof of solid fundamentals and a strong position in the RWA story. Others saw it as a red flag.
What stood out: Mantra’s market capitalization contrasted sharply with actual usage. With about 41,000 token holders, Mantra is in the top-15 of L1 blockchains, but total value locked (TVL) was only $3.3 million. The chain also had an RWA share of only 0.7%. At the end of February, a user joked on X: “The best tip for crypto founders now? Hire the OM market maker.”
Famous YouTuber Coffeezilla laid into Mullin as well. His suspicion: intermediaries through OTC deals artificially pumped the OM price, to later sell for profit. Mullin admitted there had been OTC selling to cover operating costs, but denied active price manipulation.
But if the team had nothing to do with the crash, how could the token plunge so hard with a $5 billion market cap? Where were the loyal “dip buyers”?
One possible explanation: OM was overvalued from the start and extremely illiquid, making big sell orders by investors or attackers trigger a chain reaction.
Another theory: a targeted attack. Analysts say OM futures were sold on a large scale, leading to forced liquidations. “Every ten seconds there were $1–2 million in sales on Binance Perp for two minutes,” View post on Xsaid an analyst. “That points to a chain reaction of liquidations in a razor-thin order book.” The spot markets showed significantly less volume.
Some observers think it was never the plan to drop OM so hard, but the process fed on itself and got completely out of hand.
The OM crash exposes a broader weakness in the current altcoin model. “If there are no buyers during a 90 percent drop, they probably weren't really there to begin with,” crypto analyst Mando concludes.
Again, market makers come into view: invisible forces that can inflate prices, but pull back just as fast when things get risky with disastrous consequences.
“They clearly pulled back,” one analyst writes. “This shows how fragile crypto order books are: a market cap can evaporate in a single day.”
The prevailing model of “low float, high FDV” (low circulation, high future value) has led to unstable tokens that are more hype-based than use-based. Market makers played a role as long as small investors were willing to step in — but that era seems over.
There’s no clear motive for Mantra to crash it themselves. If they misled their community, it was at least in an unusually inefficient way. Still, trust is badly damaged.
Notably: even Mullin himself admitted to Coffeezilla that the price surge was “a little odd.” The ‘first-mover advantage’ Mullin ascribed to Mantra in the RWA space also looks set to be lost. While Ethereum and its L2s continue to dominate the space, Mantra now hangs by a thread.
Yet there is hope. Partners like the DAMAC Group (a real estate giant from the Emirates) remain involved. Mantra is targeting to tokenize RWAs worth at least $1 billion through them. In addition, Mantra holds a VARA license from Dubai, allowing it to offer legitimate DeFi services.
“We have our licenses. We have distribution channels,” Mullin said. “So far no one has presented a plan that truly works. We have one, but it’s not like you flip a switch and everything runs tomorrow.”
