The recent collapse of OM in Mantra left the confused community. In a series of instant falls, $ 5.5 billion was erased. According to several analyzes, the incident was caused by a merchant manipulating two scholarships.
All this incident highlights the fragility of many token projects. Despite an ostensibly enormous market capitalization, a relatively small quantity of liquidity sparked a complete collapse.
Explore the OM crash
When the Mantra OM token collapsed earlier this week, it left a large number of unanswered questions. This sparked disloyal game claims, and rumors of initiate activity have since allowed the company.
According to a new analysis, the initial trigger of the OM crash was a single trader:
“This was due to one or entities on the Binance perpetuated market. This is what triggered the whole waterfall. The initial decline below $ 5 was triggered by a short -term position of ~ 1 million USD sold on the market.
After having triggered this initial anomaly, this merchant OM continued to pour short positions at five -second intervals, which fueled the global crash. While these continuous discharges continued on Binance, the OKX points market experienced almost 20%.
The seller finds the exit liquidity
This strange behavior on OKX was caused by a massive whale. A limit sales order allows the seller to specify the minimum price for which it is ready to sell a cryptographic asset. The order will only run if the market price reaches or exceeds the limit price. Until then, the order remains open in the order book.
This person alone kept the price set on OKX for more than a minute, which bought the assets despite the assets. According to this method, the aggressor was able to empty the OM tokens during the start of the accident.
The problem is therefore not that OM fell because of a harmful actor trying to ingest an accident. Instead, the problem is that one entity could handle the markets so completely.
For an attack as this one to work, OM’s ostensible market capitalization had to be much more fragile than expected.
In other words, even if OM’s market capitalization was theoretically very high, it took a relatively small investment to crush the RWA token like a card house. Some even hypothesized that this trader did not even try to cause a crisis.
Rather, they may be investors who have been forced to sell due to loan conditions or risk limits. A slight manipulation could have caused greater disaster.
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