​The recent sharp decline in $OM's price—from approximately $6 to $1—can be attributed to significant changes in its tokenomics

To support the launch of the MANTRA Chain mainnet, the project introduced a new tokenomics model that includes:

The recent sharp decline in $OM's price—notably, from around $6 to $1—can be attributed to significant changes in its tokenomics, as officially announced by MANTRA.

What Changed?

To support the launch of the MANTRA Chain mainnet, the project introduced a new tokenomics model that includes:

* Doubling the Token Supply: An additional 888,888,888 OM tokens were minted, increasing the total supply to 1.78 billion OM.

* Transition to an Uncapped Inflationary Model: Moving away from a fixed supply, OM adopted an uncapped inflationary approach to provide flexibility for future growth and ecosystem incentives.

New Allocations: The newly minted tokens are allocated to various purposes, including:

* OM Upgrade: Rewards for existing stakers.

* Genesis Airdrop & Incentivized Testnet: Tokens to promote MANTRA Chain’s usage and attract community participation.

* Core Contributors: Incentives for team members, investors, advisors, and active contributors.

Why Did the Price Crash?

The sudden increase in token supply led to immediate market reactions:

* Dilution of Existing Holdings: Doubling the supply reduced the value of existing tokens, leading to a sell-off.

* Market Uncertainty: The shift to an inflationary model introduced uncertainty about future token value, prompting further selling.

* Unlocking Events: Upcoming token unlocks, such as the 7.07 million OM scheduled for April 18, 2025, may have contributed to selling pressure.

In response to these changes, Binance issued a warning on the $OM trading pair, highlighting the significant alterations to its tokenomics and the substantial increase in token supply.

News data source: kdj.com

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