Mantra Price Crashes 90%: Binance Reveals Causes Behind OM’s Collapse

The dramatic 90% plunge in Mantra’s (OM) value shook the crypto market, erasing millions from investor portfolios. This event raised concerns about potential underlying problems with the token’s structure. Binance, the leading global cryptocurrency platform, reacted to the situation, offering explanations for the Mantra price collapse and outlining expectations for traders. The exchange highlighted cross-exchange liquidations and adjustments in Mantra’s tokenomics as key factors behind the sharp decline.

As traders sought reasons for the OM price drop, Binance confirmed on X that it was monitoring the situation. The platform noted that significant modifications to Mantra’s tokenomics, such as an increased circulating supply, have created volatile conditions. These internal shifts and large sell-offs and liquidations quickly harmed investor confidence. Binance emphasized that it applied early risk control measures, adjusting leverage and issuing OM trading warnings in anticipation of such instability.

Cross-Exchange Liquidations Spark Domino Effect

Binance’s analysis initially blamed the Mantra price crash on extensive cross-exchange liquidations. As leveraged positions failed across various platforms, soaring liquidations increased downward pressure on OM price. According to the exchange, this liquidity-driven sell-off affected multiple major platforms, not just Binance. These events started a chain reaction, causing Mantra’s rapid devaluation within hours.

Binance is aware that $OM, the native token of MANTRA, has experienced significant price volatilities. Our initial findings indicate that the developments over the past day are a result of cross-exchange liquidations.

Since October of last year, Binance has implemented various…

— Binance Customer Support (@BinanceHelpDesk) April 14, 2025

Automated trading bots and margin calls activated during the sell-off added to the turmoil of the Binance OM incident. These elements increased the pace of liquidations, creating a loop that sent OM price to an $0.4222 intraday low. Over $66 million in OM positions were liquidated in just 12 hours, revealing the significant level of leveraged exposure that had been building up. The liquidity crunch intensified when large wallet holders dumped large amounts of the token, increasing market volatility.

Binance’s Preemptive Risk Controls Come into Focus

Binance had acted earlier to reduce potential harm from unstable Mantra price movements. Since October last year, the platform has reduced leverage levels for Mantra trading and added alerts on its spot interface. These warnings aimed to inform users about fundamental changes affecting this token, aiding better decision-making. Despite these measures, the significant scale of the liquidation wave impacted many market participants.

Binance also pointed to the growing OM supply, which has steadily increased since January. The exchange suggested this value dilution might have weakened OM price support levels when large holders decided to sell. The supply rise coincided with $227 million in OM flowing to exchanges, as noted by blockchain tracker Lookonchain. Binance’s transparency about these issues could guide future responses to similar market events.

Investor Fallout and Community Response

The OM price crash severely affected individual traders, causing losses ranging from thousands to millions. A prominent trader, JB, reported losing $3.3 million after investing substantially in Mantra. His investment aimed to support the growth of real-world assets (RWAs) on the blockchain. Holding only $200,000 in OM now, JB’s situation shows the widespread investor losses from the event.

Anger and confusion spread throughout the community, prompting demands for accountability from the Mantra team. Calls for greater transparency from exchanges also grew. Allegations of a rug-pull emerged as traders questioned the sell-offs’ timing and magnitude. However, Binance’s communication emphasized reckless liquidations and supply inflation as reasons, offering another narrative.

Clarity Amid Crisis: Binance Sets a Precedent

At a time of widespread misinformation, Binance’s proactive steps may have helped calm broader market sentiment. By providing a clear, data-driven account of the Mantra price crash, the exchange presented itself as responsible. Transparency about risk measures, token supply details, and liquidation patterns provides a template for platforms during future market disruptions.

Going forward, the Binance OM incident might shape how other exchanges handle abrupt price drops. Growing regulatory scrutiny and more cautious retail investors could push the industry toward greater structured transparency. Currently, traders are cautious, but Binance’s quick reaction guided OM holders in a problematic period, bringing clarity to a chaotic situation.