The OM token of Mantra (OM<\/a>) underwent a significant rebound after experiencing a 90% drop over the weekend, following proactive measures from the project’s team in response to accusations of a rug pull scam.<\/p>\n As of April 14, OM was priced as high as $1.10, reflecting nearly a 200% increase from its post-crash low of $0.37 just a day earlier.<\/p>\n OM\/USDT daily price chart. Source: TradingView<\/em><\/p>\n<\/figcaption><\/figure>\n The rebound was triggered after Mantra addressed the escalating accusations of a rug pull.<\/p>\n Co-founder JP Mullin assured the community that the project is still operational, noting that the official Telegram group is \u201cstill online.\u201d<\/p>\n \u201cWe are present and not going anywhere,\u201d Mullin stated, also providing a verification address to validate the team\u2019s OM token holdings. He ascribed<\/a> OM\u2019s decline to \u201cirresponsible forced liquidations initiated by centralized exchanges.\u201d<\/p>\n Source:<\/em> JP Mullin <\/em><\/a><\/p>\n<\/figcaption><\/figure>\n This reassurance helped to alleviate the panic selling of the OM token, which had wiped out over $5 billion in market value and liquidated<\/a> $75.88 million worth of futures contracts in just one day.<\/p>\n Several online commentators suggested that the Mantra team, which reportedly holds 90% of the token supply, engineered the sell-off due to suspicious OM transfers<\/a> to centralized exchanges immediately before the crash.<\/p>\n Source: <\/em>AltcoinGordon<\/em><\/a><\/p>\n<\/figcaption><\/figure>\n Analyst Ed further accused the Mantra team of using their OM holdings as collateral to obtain high-risk loans on a centralized exchange. <\/p>\n He pointed out that a sudden shift in the platform’s loan risk settings led to a margin call, exacerbating the token’s sharp decline. <\/p>\n Source: <\/em>Ed<\/em><\/a><\/p>\n<\/figcaption><\/figure>\n Exchanges modify loan risk parameters to handle market fluctuations and shield themselves from potential insolvency due to declining collateral values. Centralized platforms like OKX have revised their parameters following Mantra\u2019s tokenomics adjustment in October 2024.<\/p>\n Notably, in that month, Mantra doubled<\/a> its total supply of OM tokens from 888,888,888 to 1,777,777,777. It also shifted from a capped to an uncapped, inflationary structure with an initial annual inflation rate of 8%.<\/p>\n Source: <\/em>Wu Blockchain<\/em><\/a><\/p>\n<\/figcaption><\/figure>\n OKX CEO Star Xu claimed<\/a> that Mantra is a \u201cmajor scandal,\u201d announcing that it would provide pertinent reports regarding its crash in upcoming days.<\/p>\n OM\u2019s 200% recovery from its $0.37 low might appear striking, but its pattern closely resembles the traditional bull trap observed in Terra\u2019s LUNA incident<\/a> back in May 2022.<\/p>\n OM\u2019s price has plummeted below the 50-week exponential moving average (50-week EMA; the red wave) support at approximately $3.25 and is now encountering resistance at the 200-week EMA (the blue wave) around $1.08.<\/p>\n OM\/USDT weekly price chart. Source: TradingView<\/em><\/p>\n<\/figcaption><\/figure>\n Simultaneously, OM\u2019s weekly relative strength index (RSI<\/a>) has decreased to 33.31, indicating a weakening momentum and a heightened risk of another drop.<\/p>\n Related: <\/strong><\/em>What is a rug pull in crypto and 6 ways to identify it?<\/strong><\/em><\/a><\/p>\n This setup closely resembles LUNA\u2019s post-crash dynamics. After its steep decline in May 2022, the price saw a brief recovery but could not return to its 50-week and 200-week moving averages, setting off a deeper and more extended downtrend.<\/p>\n LUNA\/USD weekly price chart. Source: TradingView<\/em><\/p>\n<\/figcaption><\/figure>\n Similar to LUNA, OM currently encounters rising skepticism despite the temporary rebound, with analyst AmiCatCrypto<\/a> predicting that the Mantra token could drop 90% within a single day after a 100-day rally.<\/p>\n \u201cIf you were to ask me if the bull market is finished. Brief answer. YES,\u201d she remarked, adding: <\/p>\n \u201cAny profits from this point onwards are considered bounces.\u201d<\/p><\/blockquote>\n This article does not provide investment advice or recommendations. Every investment and trading action carries risks, and readers should perform their own due diligence before making a choice.<\/p>\n \n<\/div>\nOM surges 200% as co-founder addresses issues<\/h2>\n
OM rebound may mimic LUNA\u2019s bull trap<\/h2>\n