In the early morning of April 14, 2025, the cryptocurrency market experienced a shocking "black swan" event - MANTRA (OM), a star project in the RWA (real asset tokenization) sector, plummeted from around $6.2 to $0.3706 in just a few hours, a drop of more than 90%, and a market value of $5.5 billion evaporated. Although it rebounded to $1.2, this flash crash has completely destroyed investor confidence and caused a $58 million contract liquidation. This disaster not only exposed the high fragility of the cryptocurrency market, but also revealed the multiple risks of project control, liquidity traps and community trust crisis.
1. Event review: From the “demon coin myth” to the bloodbath
The collapse of OM was not without warning. Since November 2024, OM has started to violently increase its price by relying on the "strong market maker" mode, and its price has climbed from less than $0.1 to $6, an increase of more than 300 times, and was dubbed the "demon coin" by the community. However, the plunge in the early morning of April 14 broke this bubble: OM suffered a series of liquidations during a period of extremely low liquidity, and its price fell to $0.5 within 3 hours. The team then issued an emergency statement saying that it was "not a technical loophole or sell-off", but the market panic could no longer be contained.
The chain reaction of this crash was extremely tragic:
1. The contract market is in a bloodbath: Coinglass data shows that the OM contract liquidation volume reached 58 million US dollars in 4 hours, and a large number of leveraged long positions were forcibly liquidated.
2. Collapse of community trust: Investors have raised doubts about the team’s statements, especially the multiple changes in the airdrop rules and rumors of large investors selling off, which further exacerbated the selling pressure.
3. The RWA sector was hit hard: As a representative project in the RWA field, the collapse of OM caused the market to worry about the entire sector, and related tokens generally fell by 10%-30%.
2. Root causes of the collapse: triple stranglehold of market control, fraud and liquidity trap
The collapse of OM was not caused by a single factor, but was the result of the long-term manipulation of the project, the failure of community governance and defects in the market mechanism.
1. The lie of high control and false circulation volume
According to crypto analyst Mosi, the MANTRA team controls 792 million OMs (90% of the total supply) through a single wallet, and further compresses the actual circulation to only 88 million through over-the-counter transactions and "Witch Attack" airdrops. This extreme centralization allows the team to easily manipulate prices, attract retail investors to take over and quickly reap the profits. For example, on March 25, investment institution Laser Digital deposited 1.7 million OMs (worth $11.49 million) into Binance, while another whale address transferred $40 million of OMs through Binance and OKX within a month, becoming a key driver of pull and dump.
2. “Trust fraud” of airdrop rules
The MANTRA team went back on its word on the airdrop rules many times: initially promising "unlocking 20% upon launch", then changing to "1-month cliff period + 11-month linear unlocking", and finally adjusting to "10% initial release + three-year vesting period". This erratic rule change is essentially to convert community traffic into a long-term lock-up tool, while shifting the responsibility to the community in the name of "governance voting", while actually concentrating the voting rights on the team's affiliates. The failure of the airdrop expectations directly led to a large-scale sell-off by early participants.
3. Liquidity trap and fatal cycle of leverage liquidation
The actual circulation of OM is extremely low, and the market depth is seriously insufficient. When large investors sell in a concentrated manner (such as 0x9a…1a28 address transferring 20 million USD of OM to OKX), liquidity dries up instantly, and the price plummets, which in turn triggers a series of forced liquidations of leveraged contracts, forming a death spiral of "fall → liquidation → further fall".
3. Market revelation: the fragility of the crypto world and the survival rules of investors
The OM incident sounded the alarm for the crypto market, revealing the following key risks and response strategies:
1. Beware of the Ponzi trap of “highly controlled projects”
If a project party controls more than 50% of the market, it may become a "manipulated stock", and OM's 90% control rate makes it completely a tool for the team to make money. Investors need to verify the distribution of tokens through on-chain data analysis (such as Arkham and Nansen) to avoid being misled by false circulation.
2. Liquidity risk is higher than expected return
Low-liquidity assets are easily manipulated, especially in the derivatives market, where leveraged trading can amplify volatility. Investors should avoid heavy positions in low-market-cap, low-volume projects and set strict stop losses.
3. The necessity of transparency in community governance
The OM airdrop controversy exposed the hypocrisy of decentralized governance. True community governance must ensure that voting rights are decentralized and the rules cannot be tampered with, rather than being "self-directed and self-acted" by the team.
4. Self-protection in the absence of supervision
Currently, the regulation of the crypto market is still in a gray area, and investors need to rely on independent audits (such as project financial reports, smart contract code reviews) and risk diversification strategies. For example, Supermicro's stock price plummeted by 30% due to the resignation of the audit firm Ernst & Young. Similar incidents need to be more vigilant in the crypto field.
IV. Future Outlook: Redemption or the End of RWA?
Although the collapse of OM has dealt a heavy blow to the short-term confidence in the RWA sector, the long-term value of tokenizing real assets cannot be denied. A true RWA project needs to solve the following problems:
- Asset transparency: On-chain assets must be anchored one-to-one with offline entities and audited regularly.
- Decentralized governance: avoid team dictatorship and introduce DAO mechanism to balance power.
- Liquidity innovation: Improve asset liquidity and reduce room for price manipulation through cross-chain protocols and derivative tools.
Conclusion: The light of reason behind the black swan
The collapse of OM is a microcosm of the growing pains of the crypto market. It not only exposes the dark side of the industry, but also points out the direction of improvement for investors and practitioners. Only through technical transparency, fair governance and risk education can the "black swan" be transformed into a catalyst for market maturity. As Taleb said in (The Black Swan): "Destructive events will eventually happen, but the survivors will become stronger." In the wild west of the crypto world, rationality and vigilance are still the most reliable armor for investors.
