In a devastating market event reminiscent of the LUNA crisis, the Mantra token (OM) has experienced a catastrophic collapse, plummeting more than 90% in value within a single day.
The native cryptocurrency of the Mantra real-world tokenized asset blockchain crashed from approximately $6.30 to below $0.50 on April 13, wiping out the majority of its $6 billion market capitalization.
What is Mantra?
Mantra is a decentralized finance (DeFi) platform and ecosystem designed to provide financial services such as staking, lending, governance, and real-world asset (RWA) tokenization through blockchain technology.
Below is an overview of its features and recent developments:
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Decentralized Finance Services:
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Mantra offers staking, lending, borrowing, and governance functionalities within its ecosystem
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Users can stake OM tokens to earn rewards and participate in governance decisions
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Real-World Asset Tokenization:
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The platform focuses on tokenizing physical and financial assets securely and compliantly, bridging traditional finance with blockchain technologies
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Infrastructure:
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Built on the Cosmos SDK with interoperability via the Inter-Blockchain Communication (IBC) protocol, Mantra ensures seamless cross-chain operations
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It uses a Proof-of-Stake (PoS) mechanism secured by sovereign validators
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Governance:
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OM token holders have voting rights within the Mantra DAO, allowing them to influence ecosystem developments
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Compliance:
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Mantra emphasizes regulatory adherence, making it suitable for institutional adoption of blockchain technologies
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Mantra Rug Pull?
Market participants have begun speculating about the nature of this collapse, with some traders suggesting it bears similarities to a “rug pull” scenario. Investor Gordon voiced concerns on social media, questioning whether this could be “the biggest rug pull since LUNA/FTX” and calling for the team to address the situation before OM potentially “heads to zero.”
The exact cause behind the dramatic price decline remains unclear. This incident adds to a string of recent cryptocurrency market disasters, including the Libra memecoin implosion and the $1.4 billion Bybit hack, which have collectively resulted in billions of dollars in investor losses during early 2025.
In response to the crisis, Mantra co-founder JP Mullin took to social media platform X to reassure investors, stating, “We are here and not going anywhere.” Mullin confirmed that the project’s Telegram group remains operational and provided verification that the team’s token allocation remains in their custody.
The Mantra team has attributed the collapse to “reckless liquidations” rather than any actions taken by the project leadership.
Mantra Progress in UAE
The collapse comes at a particularly surprising time, as Mantra had been making significant inroads into the Middle Eastern market.
In January 2025, the project announced a $1 billion partnership with investment conglomerate DAMAC to tokenize various assets including real estate and data centers on the Mantra blockchain.
Just two months later, in February 2025, Mantra Finance secured a virtual asset service provider (VASP) license from Dubai’s Virtual Assets Regulatory Authority (VARA), allowing it to expand operations throughout the UAE and broader MENA region.
This regulatory achievement was hailed as a major milestone by Mullin, who had praised Dubai and VARA as “world leaders in crypto regulation” and described the license as “a crucial step for Mantra and a key step in our journey toward global expansion.”
The license had positioned Mantra to offer digital asset exchange services, broker-dealer operations, and investment consulting to institutional clients and qualified investors in the UAE.
The partnership with DAMAC had been particularly noteworthy, promising to bring blockchain-powered transparency, security, and accessibility to DAMAC’s extensive asset portfolio. DAMAC founder Hussain Sajwani had recently gained additional prominence through his pledge of at least $20 billion in foreign investment to build new data centers across the United States.
As investors and market observers await further clarification, the dramatic collapse of the OM token raises serious questions about the stability and security of even seemingly established blockchain projects in the evolving cryptocurrency landscape.
