Mantra founder and CEO John Marin began burning a $80 million OM token to regain trust following a sudden crash of tokens in early April. However, the question of the underlying reasons for the OM crash remains unanswered, a blockchain investigator told Cointelegraph.
Unpacking Mantra’s OM crash requires more detailed forensic research than just basic blockchain analysis, says Natalie Newson, senior blockchain investigator at blockchain security firm Certik.
“To demonstrate the calculated claims of exploitation, a complete forensic investigation similar to what we saw after FTX is needed,” Newsson told Cointelegraph.
Newsson’s perspective on OM crash came just days after the Mantra issued its post-crash statement.
ONCHAIN Activities and Opaque OTC Transactions
Addressing the OM token crash, Certik’s Newson highlighted the importance of distinguishing between public on-chain activity and “the more opaque nature of OTC trading.”
Mantra CEO Mullin revealed in an interview with Coffeezilla on April 15 that the Mantra team “does a small amount of OTC” of OM tokens up to $30 million.
Unlike traceable transactions in centralized exchanges, OTC Crypto transfers include ways to buy and sell cryptocurrencies outside exchanges designed to allow for deep liquidity and large-scale transactions while reducing price volatility.
“In this case, the accumulation of about 100 million OM by whales appears to be the result of secondary market transactions. It is not necessarily a direct activity from the cloak line cider,” Newsson said.
Analysis by Arkham or Nansen is not sufficient
As mentioned earlier, Mullin denied the claim that the OM crash stemmed from insider token dumps, claiming that blockchain analytics platform Arkham “mislabeled” some of his wallet.
Similar platforms like Arkham and Nansen are insufficient to confirm or deny insider involvement, Newson said.
“To see the tuned insider’s behavior, you might need more than basic wallet tracking on platforms like Arkham and Nansen,” says Newson.
“Blockchain analytics tools can provide directional clues, but without access to off-chain contracts and centralized exchange records, it is difficult to draw a decisive conclusion.”
Newson does not only highlight the complex nature of trace transactions in OM token crashes.
Related: Mantra Homme Token Crash reveals “critical” liquidity issues in cryptography
“There are ways to get data from nodes, but it doesn’t seem easy to get a full history,” Frank Wart, co-founder of Whale Alert, told Cointelegraph.
Mullin previously said the team had been considering hiring a forensic auditor after the OM crash, but had not made a decision as of April 16.
Arkham did not respond to multiple Cointregraph inquiries to comment on the Mantra incident.
Magazine: Is Altcoin season a hit in Q2? Mantra Plans to Gain Trust: Hodler’s Digest, April 13-19
