The mystery of the collapse of the OM token: The shady transactions behind the scenes of Mantra

The founder and CEO of Mantra, John Mullin, has begun to burn 80 million OM tokens to regain user trust following this token's incident in early April. However, the question of the fundamental reasons behind the incident remains unanswered. Natalie Newson, a senior blockchain investigator at the blockchain security company CertiK, stated that decoding the OM incident of Mantra will require a detailed forensic study rather than just basic blockchain analysis. Newson told Cointelegraph that: "A full forensic investigation, similar to what we saw after FTX, will be necessary to prove the allegations of calculated mining behavior," while emphasizing the challenges in tracking OTC transactions. Newson's perspective on the OM incident was released a few days after Mantra issued a statement following the incident, requesting centralized exchange partners to cooperate to further clarify the incident. On-chain activities compared to opaque OTC transactions Referring to the OM token collapse incident, Newson emphasized the importance of distinguishing between public on-chain activities and the "more opaque nature of OTC transactions." In an interview with Coffeezilla on April 15, the CEO of Mantra, Mullin, revealed that the Mantra team had "conducted a small amount of OTC," totaling up to 30 million OM tokens.

Unlike traceable transactions on centralized exchanges, OTC cryptocurrency transfers involve the method of buying and selling cryptocurrencies off-exchange, designed to allow for deep liquidity and large trades while minimizing price volatility. Newson stated: "In this case, a whale accumulating around 100 million OM seems to be the result of transactions on the secondary market - not necessarily direct activity from insiders at Mantra." The analysis from Arkham or Nansen is insufficient. As mentioned earlier, Mullin denied the allegations that the OM incident was due to internal token leakage, while asserting that the blockchain analysis platform Arkham had "mislabelled" some wallets. Newson stated that data from Arkham and similar platforms like Nansen will not be sufficient to confirm or deny the involvement of the insider. Newson stated: "To confirm coordinated insider trading behavior, it may require more than just monitoring basic wallets on platforms like Arkham or Nansen," adding: "Blockchain analysis tools can provide directional clues, but without access to off-chain agreements and centralized exchange records, it will be very difficult to draw certain conclusions." Newson is not the only one highlighting the complex nature of tracking transactions in the collapse of the OM token. Frank Weert, co-founder of Whale Alert, shared with Cointelegraph that: "There are many ways to get data from a node, but it seems not easy to obtain the complete history." Mullin previously stated that the team had considered hiring a forensic auditor after the OM incident but had not made any decisions until April 16.