The OM token, a major player in the cryptocurrency market, continues to face significant challenges as its price remains far from its former glory. After reaching an all-time high of $9.10, the token has plummeted by over 99%, leaving many investors questioning its future prospects. Currently trading at just $0.6575, the OM token’s market cap has drastically fallen from a peak of over $8.2 billion to a mere $633 million. Despite efforts by its team to rejuvenate the token’s value, attempts have been met with fierce resistance, signaling that recovery may not come easily.
Initiatives Fail to Gain Traction
Mantra, the platform behind the OM token, has tried various strategies to turn things around. One of their main initiatives has been to assure the market that the ecosystem remains healthy. The company has pointed fingers at one exchange, accusing it of executing large liquidations that significantly contributed to the token’s steep decline, pushing it down by more than 90% in a single day.
While the blame on the exchange has stirred some debate, the accusations of internal foul play have been more contentious. Analysts, including those from Arkham, have claimed that insiders and large investors within Mantra were involved in dumping their tokens, which the company has vehemently denied. This has created an atmosphere of distrust, further undermining investor confidence in the token.
Despite these setbacks, the company has rolled out a series of moves designed to boost the price of OM. These include the burning of millions of tokens and plans to repurchase tokens via buybacks. The idea behind burning tokens is to reduce the total supply, making the remaining tokens potentially more valuable. Meanwhile, buybacks aim to stabilize the price by using the company’s treasury to purchase OM tokens from the open market, effectively removing them from circulation.
However, these measures have done little to spark a genuine recovery. While buybacks and token burns can have short-term benefits, they are often not enough to reverse a longer-term downtrend, especially when investor sentiment has already soured.
Retail Investors Hopeful but Cautious
In light of Mantra’s dramatic price plunge, some retail investors have begun to eye the OM token, hoping to capitalize on a potential recovery by buying the dip. This strategy is common among cryptocurrency enthusiasts, who often view significant price drops as opportunities to get in on a token at a lower price, hoping it will rebound in the future.
Yet, this approach carries considerable risk, as many assets, including cryptocurrencies, are prone to quick price swings that can mislead investors. Experts warn that unless clear signs of a genuine recovery emerge, investing in a token in decline can be a dangerous gamble.
The short-term recoveries witnessed on Tuesday and Wednesday, while encouraging for some, are more likely to be part of what is known as a “dead cat bounce.” This is a phenomenon where a failing asset experiences a brief surge in price before ultimately continuing its downward trajectory. Unfortunately, these rallies often tempt inexperienced investors, only to result in further losses once the decline resumes.
Bearish Signals Emerge in Mantra’s Price Pattern
Compounding concerns for OM token holders is the emergence of a bearish pennant chart pattern, a common sign of continued decline in the cryptocurrency market. The pattern is formed by a sharp vertical line followed by a symmetrical triangle, suggesting that the price may continue to fall in the weeks ahead.
Despite this ominous signal, some market participants remain optimistic that OM could experience short-term price increases, albeit potentially misleading. Cryptocurrencies are notorious for undergoing periods of apparent recovery, only to see sharp corrections afterward. Coins like Celsius, Voyager Digital, FTX Token (FTT), and Terra Luna have all shown similar patterns of brief recovery, before ultimately sinking to even lower levels.
This type of behavior—brief upticks before continued drops—has left many wary of taking large positions in assets like OM, especially when the overall market sentiment is negative. The pattern formed by Mantra’s token suggests that the next few weeks could be critical for determining whether OM is truly finished or if it can pull off a miraculous rebound.
While some may argue that every dip presents an opportunity, it’s important to recognize that Mantra’s situation bears strong resemblance to those of failed projects in the past, and the potential for long-term recovery remains uncertain at best.
