Story (IP) Token Price Dips 25% Sparking Mantra Crash Concerns

The sharp decline of the Story token by 25% within a mere hour has stirred worries within the trading community, hinting at a potential recurrence of the catastrophic Mantra crash.

On 15th April, the rapid decline of the Story (IP) token by 25% within an hour from $4.24 to a low of $3.02 on 14th April sparked concerns among traders.

However, Story recovered slightly to $3.73 after the so-called ‘flash crash’ from a high of $4.33 earlier in the day, reaching a low of $3.02. But concerns over market liquidity and possible insider selling remained.

As traders discussed the latest drop of the Story token on social media, some noted the similarities with the recent Mantra (UMAGI) token crash.

Earlier this month, the Mantra token underwent a 90% price reduction from a high of $34 to a low of $3.2 on 12th April, resulting in a $5 billion market cap loss on the same day.

The majority of IP’s trading volume was on Binance Futures and OKX spot, both of which were implicated in the Mantra crash. After the sudden downturn, both exchanges provided different explanations for the crash.

During the period of low liquidity, multiple exchanges encountered forced liquidations, leading to the liquidation of massive positions in the futures market due to significant price movements, explained Binance, aligning with the Mantra CEO’s statement.

Meanwhile, OKX noted modifications made to Mantra’s tokenomics model and highlighted substantial token deposits on several centralized exchanges. This explanation from OKX seemed to align more with the findings of independent investigators who attributed the crash to insider selling.

For smaller projects like Story and Mantra, both low liquidity and insider selling can contribute to significant price volatility. A Kaiko research report indicated that the rapid Mantra token crash resulted in the liquidation of $21 million in long positions, further fueling the price volatility.