$5.3 Billion Vanishes as Mantra Token Collapses Overnight
The cryptocurrency market was rocked Sunday when Mantra’s OM token plummeted over 90% in just hours, evaporating approximately $5.3 billion in market value and triggering $72 million in forced liquidations. The catastrophic collapse, which saw OM plunge from $6.30 to under $0.50, has sparked intense debate about whether the incident represents a coordinated “rug pull” or resulted from legitimate market dynamics.
As of Monday, OM is trading near $0.68, showing minimal recovery from its lows. The dramatic fall has left investors reeling and drawn comparisons to previous crypto market catastrophes like the Terra-Luna collapse, which wiped out $60 billion and triggered an extended “crypto winter” in 2022.
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Reckless Liquidations or Calculated Exit?
Mantra co-founder JP Mullin quickly denied allegations of wrongdoing, claiming the collapse stemmed from “reckless forced closures initiated by centralized exchanges on OM account holders” rather than actions by the project team. “The timing and depth of the crash suggest that a very sudden closure of account positions was initiated without sufficient warning or notice,” Mullin posted on social media, according to Fast Company.
Mullin further suggested the timing—during low-liquidity hours on Sunday evening UTC—pointed to “negligence at best, or possibly intentional market positioning taken by centralized exchanges.” To counter fraud allegations, he shared verification addresses for the Mantra team’s OM tokens, insisting, “We are here and not going anywhere.”
The collapse has intensified scrutiny of Mantra, which specializes in real-world asset tokenization and gained prominence through a $1 billion deal with investment conglomerate DAMAC in January 2025 to tokenize real estate and other physical assets on its blockchain.
Dear @MANTRA_Chain @_RichardTeng @cz_binance
— JB (@Jeetburner) April 13, 2025
I invested $3,500,000 into your RWA token, $OM. That investment is now worth barely $200,000, a drop of over 90%.
My intention was to support the future of RWAs. I conducted thorough due diligence, and the supposed partnership with… pic.twitter.com/G11642FWYC
Exchange Investigation Reveals Suspicious Activity
Major cryptocurrency exchange OKX released findings from its investigation, revealing “major changes to the MANTRA token’s tokenomics model since Oct 2024” and evidence that “several on-chain addresses have been executing potentially coordinated large-scale deposits and withdrawals across various centralized exchanges since Mar 2025,” according to Cointelegraph.
On-chain data shows that before the crash, 17 wallets deposited a staggering 43.6 million OM tokens (worth approximately $227 million) to exchanges. This massive influx, combined with concerns about token distribution—the Mantra team reportedly controls 90% of the circulating supply—likely triggered the initial panic selling that cascaded into a liquidation spiral.
In response, OKX has added warnings to the OM token page on its platform and implemented additional risk control measures to protect users from further volatility.
Nomura Subsidiary Distances Itself from Controversy
As speculation spread about which parties might have initiated the selling, Switzerland-based trading firm Laser Digital, part of the Nomura Group, publicly denied any involvement in the crash. “Assertions circulating on social media that link Laser to ‘investor selling’ are factually incorrect and misleading,” the firm stated, sharing its controlled Mantra wallet addresses as evidence of no exchange deposits or selling activity, according to CoinDesk.
The firm’s unusual public denial highlights the reputational risks that established financial institutions face when engaging with volatile cryptocurrency projects, particularly those experiencing dramatic market events.
Regulatory Implications Loom Large
The Mantra collapse could have significant regulatory implications, particularly given the project’s recent expansion in the United Arab Emirates. In February 2025, Mantra obtained a virtual asset service provider license from Dubai’s Virtual Assets Regulatory Authority (VARA), allowing it to operate crypto exchanges and broker-dealer services within the country.
Industry observers note that regulators worldwide will likely scrutinize this incident closely, as it involves a licensed entity in a regulated jurisdiction experiencing a catastrophic market event. The outcome could shape future regulatory approaches to asset-backed tokens and real-world asset tokenization.
“This collapse raises serious questions about the stability of tokenized real-world assets,” noted cryptocurrency regulatory expert Amanda Chen. “When assets supposedly backed by physical collateral like real estate can experience 90% crashes overnight, regulators will inevitably question whether current oversight mechanisms are sufficient.”
As trading volume in OM has skyrocketed by over 3,425% to $2.6 billion, market participants remain divided on whether the token can recover or if this incident marks the beginning of a broader cryptocurrency market correction after months of bullish momentum.
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