Mantra DAO is facing intense scrutiny after transferring $26.96 million worth of its native OM tokens to Binance, shortly after the token experienced a 90% price crash. The move raised serious questions about potential insider selling and shook investor confidence in the project.
The collapse saw OM fall from a high of $6.28 to just $0.7192, wiping out over $5 billion in market capitalization in a matter of hours. Analysts were quick to raise red flags, citing the timing of the token transfer and Mantra’s centralized token supply. With 90% of OM controlled by the team, the likelihood of internal manipulation is a growing concern for the community.
Leadership Blames Liquidations, Not Sell-Offs
JP Mullin, CEO of Mantra DAO, attempted to ease concerns by attributing the crash to forced liquidations on centralized exchanges. He dismissed claims of insider dumping, stating that the team had not sold any tokens directly.
But the crypto community wasn’t entirely convinced.
Blockchain researcher Max Brown tracked a 3.9 million OM token transfer to OKX ahead of the crash. Though token movements to exchanges don’t confirm sales, such patterns often precede large dumps—raising doubts about the official narrative. Brown called on exchanges to conduct further investigations to restore transparency.
Exchanges Offer Conflicting Explanations
Binance supported the CEO’s claims, saying the price collapse was likely due to cascading liquidations across multiple trading venues. Meanwhile, OKX contradicted that view, pointing to tokenomic changes and unusual wallet activity as possible factors behind the sharp decline.
Such discrepancies in explanations have only added to market uncertainty, with many investors still waiting for clear answers.
Low Liquidity + Centralized Supply = Extreme Volatility
Mantra DAO’s situation reflects a larger issue plaguing newer crypto projects: centralized token distribution and thin liquidity. In volatile markets, these conditions can result in devastating flash crashes. When large holders move tokens to exchanges—whether to sell or not—it’s often interpreted as a sell signal, triggering panic selling or forced liquidations.
With Mantra already controlling most of the supply, such movements raise concerns about market manipulation and transparency.
Whether the recent activity was a coordinated dump or just bad timing remains to be seen. However, the need for better governance and transparency in token distributions has once again come into sharp focus.
