- Massive OM deposits created significant selling pressure and price volatility.
- Binance took proactive measures to limit volatility with leverage controls.
MANTRA (OM) has experienced a sharp price decline, dropping to $0.7167, a decrease of 88.60% within 24 hours. The token’s value, previously $6.28, fell significantly, indicating a significant sell-off and market instability. This decline was accompanied by a surge in trading volume, increasing by over 3,038%, reflecting heightened panic selling and potential liquidation events.
Source: Coinmarketcap
The Deposits That Triggered the Price Fall
Before the crash, at least 17 wallets deposited 43.6 million OM tokens, which were worth $227 million at the time, into various exchanges. These deposits accounted for approximately 4.5% of the circulating supply of OM, creating downward pressure on the price. Blockchain intelligence firm Arkham traced two of these wallet addresses to Laser Digital, a strategic investor in the MANTRA Chain.
The large-scale deposits likely caused a supply shock, leading to the market’s reaction. These transfers flooded the exchanges with significant amounts of OM, likely triggering panic selling.
OTC Deals and the Role of Shane Shin
Interestingly, just 5 hours before the price crash, a wallet that had been dormant for a year transferred 2 million OM tokens to another wallet possibly linked to Shane Shin. 2 million OM tokens were worth $12.58 million initially but now are worth $1.57 million. This vast loss could mean OTC deals are involved.
However, Shane Shin, a well-known crypto figure, has publicly supported OM so that these movements may be part of a bigger plan. But we don’t know the reason for the transfer, and with big players involved in these large transactions, OTC deals are definitely in question.
Binance’s Role in Mitigating Volatility
Binance, one of the biggest exchanges, confirmed the massive volatility of OM in a Binance Customer Support statement. They said it was due to cross-exchange liquidations. Binance also mentioned that since October 2023, they have monitored OM’s market and implemented various risk controls, including reducing the token’s leverage.
In addition, Binance started showing pop-up warnings on its platform early this year about OM’s tokenomics changes, specifically the increase in supply. These were done to reduce market volatility and protect users. But the vast drop shows that these controls can’t prevent massive market disruption.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. CoinCryptoNewz is not responsible for any losses incurred. Readers should do their own research before making financial decisions.
