Mantra Coin (OM) recently experienced a significant crash, with its price dropping by nearly 90% in just seven days. The price went from around $6.41 to approximately $0.69. This crash has raised concerns among traders, who are questioning whether Mantra can recover from this downfall or if it signals a longer-term decline.
There have been speculations about the cause of the crash, including theories of stealth dumping or forced liquidations due to large transfers to exchanges before the crash. However, analysts believe that the crash was not a result of a rug pull, but rather due to factors such as centralized exchange dominance, thin liquidity, and automated liquidations.
Technical indicators show that Mantra Coin is currently bearish, with the price below $0.70, a low RSI (36.97), and weak volume. There is resistance near the $1.00-$1.20 range. On-chain data reveals that the Total Value Locked (TVL) remains steady at $342.2 million, with 50% of the market cap staked. However, there is also $199 million in open borrowing positions, which adds risk.
In order for Mantra to regain momentum and recover, the community is looking for updates from Mantra DAO, including token burns and credible recovery actions. Without these actions, the short-term outlook for Mantra remains bearish.
The recent crash of Mantra Coin has led to intense speculation, with many traders suspecting a token redenomination or smart contract migration as the cause. However, CEO John Mullin has denied these claims, stating that the crash was a result of a “technical domino effect.” He announced a buyback and burn plan to reduce supply and a $109 million ecosystem fund for partnerships, tech development, and marketing. While these plans have been announced, the community is cautious and waiting for clearer actions and transparency.
Technically, the outlook for Mantra Coin remains bearish. The price has struggled to hold key levels, and indicators such as the RSI and MACD confirm the bearish trend. Unless the price can regain strength above $1.00 backed by volume, the current trend suggests continued weakness.
Despite the crash, on-chain sentiment for Mantra Coin remains resilient. The Total Value Locked has held steady at $342.2 million, indicating that core DeFi users have not panicked and unstaked. Over 50% of the market cap remains staked, showing resilience among long-term holders. However, the crash has highlighted the vulnerability of Mantra to off-chain volatility and the limited on-chain liquidity.
Mantra Coin is now at a critical point, with the crash causing damage both technically and psychologically. The proposed token burn and ecosystem fund could potentially reignite interest, but execution and communication are crucial. The future of Mantra will depend on what happens next and how quickly the team can regain community trust.
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