OM Token Collapse, MOVE Market Maker Probe: Weekly Recap

Transcript

Welcome to this week's crypto roundup. In today's recap, a sudden 5 to5 billion token crash rocks mantra. Movement Labs investigates suspicious trading around its move token. And CZ rebuffs claims he cut a DOJ deal to testify against Justin Sun. We'll also cover how a simple base social post sparked a frenzy, how the White House is eyeing tariffs to boost Bitcoin reserves, and what the SEC's latest ETF delays mean for staking and redemptions. Plus, Anchorage Digital faces scrutiny from homeland security and over 12 million is drained in exploits on Zakayasync and Kilowex.

Thanks for tuning in to the weekly news recap. Let's begin. OM token crash erases $5 billion. The OM token native to real world asset blockchain mantra experienced a devastating collapse on Sunday, plummeting over 90% in value and wiping out more than $5.5 billion in market capitalization within an hour. The Mantra team attributed the freefall to reckless forced liquidations by a major investor on centralized exchanges which they say triggered cascading sell-offs in a thin liquidity environment. However, onchain analysts raised suspicions of coordinated activity. Spot onchain reported that a wallet moved over 14 million OM tokens worth approximately 91 million to OKX

just days before the crash. Adding to the controversy, pseudonmous researcher Zack XBT suggested links between the incident and Reef Finance founder Denko Maneski alongside an individual using the alias Fuko Rioshu. According to Zach XBT, the pair sought large loans backed by OM Holdings ahead of the price collapse. Based on my findings, it was not Laser Digital or Sherukq, he clarified, rejecting speculation about two VC firms previously rumored to be involved. Facing mounting scrutiny and community backlash, Mantra CEO John Mullen took to social media on Tuesday, announcing plans to burn his entire share of team tokens. When we turn it around, the community and investors can

decide if I have earned it back, he stated. Mantra confirmed that its team allocation of 300 million OM tokens, roughly 17% of total supply, is locked until April 2027. Mullen has yet to disclose how many of those tokens were specifically allocated to him. Movement Labs launches probe into move token irregularities. Movement Labs and the Movement Network Foundation have launched internal and third-party investigations into market maker abnormalities surrounding the recent performance of the Move token. The inquiry follows Binance's removal of an unnamed market maker, which allegedly sold 66 million Move tokens shortly after launch, generating an estimated $

38 million USDT profit while placing minimal buy orders. Movement Labs confirmed the ongoing probe in a statement to Block Works, calling it a standard transparency measure. It would be inappropriate to speculate on the outcome of the review or any actions that may or may not result, a spokesperson said. Meanwhile, co-founder Rushi Munchi has taken what was described internally as a temporary leave of absence. As per Blockworks, sources noted his company's Slack account was deactivated last Friday, but appeared active again by Monday. CZ Denzio ideal to testify against Justin's son. Former Binance CEO Changping CZ cow has denied a Wall Street Journal report

alleging he agreed to provide evidence against Tron founder Justin Sun as part of his 2023 plea deal with the US Department of Justice. The report citing unnamed sources claimed this cooperation was an undisclosed element of Jiao's settlement related to anti-moneyaundering violations. Jao responded on X, calling it a baseless hit piece and emphasized that he served a 4-month prison sentence unlike typical government witnesses. People who become GVY witnesses don't go to prison. They are protected, he said. Justin Sun also dismissed the rumors, writing, CZ is both my mentor and a close friend. Only by standing together can we change everything. The DOJ has not commented

publicly on the matter. Jiao has previously suggested that lobbying efforts may be targeting him and Binance as part of a broader campaign within US regulatory circles. White House eyes tariffs to boost Bitcoin reserve says adviser Bohines digital assets adviser to President Donald Trump said this week that the administration is considering using tariff revenue to expand the US Bitcoin strategic reserve. We're looking at many creative ways, whether it be from tariffs or something else, Hines said during an interview with Anthony Pompiano. The initiative follows Trump's March executive order, establishing the reserve and directing federal agencies to report their digital asset holdings.

Hines emphasized that the strategy must be budgetneutral and not burden taxpayers. The US currently holds over 198,000 BTC according to Arkham data. Hines also referenced legislation like Senator Cynthia Lumis' Bitcoin Act, which could unlock additional funding by revaluing federal gold reserves to reflect market prices and was reintroduced in March. SEC delays, key decisions on crypto ETF stakinging and redemptions. The US Securities and Exchange Commission has postponed rulings on two significant crypto ETF proposals, extending its review into June. The regulator delayed a decision on Gayscale's request to enable staking

for its Ethereum Trust and Mini Trust products, moving the deadline to June 1st. It also pushed back determinations on inkind redemptions for ETFs from Bitwise, Wisdom Tree, and Van to June 3rd. Staking would allow Gayscale to generate yield from Ethereum held in the trusts, while inkind redemptions let investors exchange ETF shares directly for crypto assets rather than cash. Though similar features are permitted in other markets like Canada and Hong Kong, the SEC has never approved staking in US ETFs. The delay follows the confirmation of Paul Atkins as SEC chair and comes amid broader agency efforts to develop a long-term digital asset strategy.

Homeland Security Task Force reportedly investigating Anchorage Digital. Anchorage Digital Bank is facing scrutiny from the US Department of Homeland Security's EL Dorado Task Force, a unit dedicated to combating money laundering and financial crime. According to a report by Barons, the unit, which focuses on transnational money laundering, has reportedly contacted former Anchorage employees to inquire about company practices and policies. The nature and scope of the probe remain unspecified. Anchorage is the only federally chartered crypto bank in the US and has previously drawn regulatory attention. In 2022, the office of the controller of the currency issued a consent order citing weaknesses

in its anti-moneyaundering controls. A spokesperson for Anchorage refuted the report, telling Cointelegraph, "The Baron's piece on our company was based on speculation and had no information about the nature of the inquiry. ZKSync and Kilox exploits drain over 12 million. Two major crypto exploits this week have shaken decentralized platforms ZKYNC and Kilox with combined losses exceeding 12 million. On Monday, decentralized exchange Kiloex was hit by a $7.5 million attack which blockchain security firms attributed to a price oracle vulnerability. The attacker reportedly manipulated ETHUSD price data, opening a position at $100 and

closing it at $10,000, netting $3.12 million in one transaction. Cyvers noted the exploiters wallets were funded via tornado cash, while Pexshield highlighted weak access controls as a key failure point. Clo, the platform's native token, dropped 30% following the breach. A day later, Ethereum layer 2 protocol ZK Sync confirmed that an admin wallet linked to its Airdrop contract had been compromised. The attacker used a contract function to mint 111 million unclaimed ZK tokens valued at roughly $5 million. ZKSync stated that no user funds were affected and that necessary security measures are being taken. And that's all. Thanks so much for joining

us today. If you enjoyed this recap, go to unchainedcrypto.com newsletter. That is unchained crypto.com newsletter and sign up for our free newsletter so that you can stay up to date with the latest in crypto. Unchained is produced by Laura Shinn with help from Matt Pilchard, Juan Oranovich, Megan Gavis, Pam Majimdar, and Margaret Korea. The weekly recap was written by Wanovich and edited by Steven Erlic. Thanks for listening.