$5.5B Crash Forces Mantra Token Burn—CEO Aims to Rebuild Trust

• Mantra CEO John Mullin has revealed plans to burn teams’ tokens to restore confidence in the project.
• Some community members opposed the plan, claiming the team may not be properly motivated.

Mantra CEO John Patrick Mullin has revealed plans to burn all the team’s Mantra (OM) tokens. According to Mullin, the aim is to rebuild trust within the community following the recent $5.5 billion Mantra (OM) token crash.

Mullin Unveils Future Plans for Mantra

A few days ago, the value of Mantra’s OM token decreased sharply by 90% in just a matter of hours. As we reported earlier, the token dropped from about $6 to $0.4, erasing over $5.5 billion in value. The team’s tokens are now worth about $236 million, with OM trading at $0.78. 

Mantra had reserved 300 million OM tokens, about 16.88% of its total supply, for its team and core contributors. According to Mullin, the tokens were locked and scheduled for release in batches between April 2027 and October 2029. 

However, Mullin has decided to burn the team’s OM tokens. The CEO believes this approach would restore confidence in the Mantra ecosystem, and his suggestion quickly sparked discussion within the crypto community.

Some community members backed Mullin’s plan to burn the team tokens. Others, however, raised concerns it could weaken the team’s drive to build the project.

“This would be a Mistake. We want teams that are highly incentivized. Burning the incentive may seem like a good gesture, but it will hurt the team’s motivation long term,” says Crypto Banter Founder Ran Neuner.

Responding to Neuner, Mullin said the community could decide on the idea through a vote. He added that the timing and depth of the crash indicated a very sudden closure of account positions.

Mullin Reassures Community Members

Mullin promised to release a post-mortem of what went wrong to ensure transparency within the community. He also revealed plans to use Mantra’s $109 million Ecosystem Fund for the possible token buybacks. Mullin added that the funds would also go into burns to help stabilize OM’s price after it crashed. 

Furthermore, the CEO denied rumors that the team controls 90% of the OM tokens or is involved in insider trading or market manipulation. He pointed out that “reckless forced closures” initiated by centralized exchanges triggered the $5.5 billion crash on Sunday.

Binance and OKX exchanges witnessed massive OM activity before the crash but have denied any wrongdoing. They pointed out past tokenomics and extreme volatility that led to massive liquidations.

Surprisingly, Mantra’s Decentralized Finance (DeFi) platform experienced a dramatic divergence between its total value locked (TVL) and the price of OM. 

As detailed in our last news piece,  Mantra’s TVL skyrocketed by over 500% to about 4.21 million OM on Tuesday. Approximately 97% of the TVL is concentrated in Mantra Swap, the platform’s native decentralized exchange. This huge concentration on a single application raises concerns about the protocol’s diversification and resilience.