Mantra price slips as the OM token staking yield rises to 21.1%

Mantra price has suffered a harsh reversal, falling for three consecutive days and moving into a technical correction.

At the time of writing, Mantra (OM) token was trading at $1.2458, down by over 11% from its highest point this month. Still, despite the pullback, it is one of the best-performing cryptocurrencies this year as it jumped by over 4,000%, pushing its market cap to over $1 billion.

OM open interest slips

Mantra’s drop has happened in a low-volume environment. Data shows that the 24-hour trading volume on Wednesday stood at over $26 million, down from $121 million on July, 17 and $304 million on July, 12.

More data shows that Mantra’s open interest in the futures market has continued to drop in the past few days. It peaked at $59 million on July, 12 and has slipped to over $34 million.

Open interest is an important aspect in the futures market because it shows the volume of unfilled orders. In most periods, a big increase in open interest is seen as a positive thing for an asset.

Therefore, the OM token likely dropped as investors took profits since it is one of the best-performing tokens in the industry since it has risen by almost 5,000% this year.

It also dropped as cryptocurrencies showed signs of losing momentum after the SEC approved 9 spot Ethereum ETFs. Bitcoin has remained below $67,000 while Ethereum dropped below $3,500. The total market cap of all cryptocurrencies has dropped to $2.4 trillion.

Tokenization demand is rising

Mantra’s decline happened at a good time for the tokenization industry. Recent data shows that Blackrock’s BUIDL product has gained over $500 million in assets.

On Tueday, Hamilton Lane, a company with over $900 billion in assets launched a tokenized fund on Solana. Also, Ondo Finance, a company that runs the tokenized USDY and OUSG funds has added over $578 million in assets. Goldman Sachs is planning to launch three tokenized projects this year.

These events mean that there is demand for tokenization, a move that will benefit Mantra, a company that bridges traditional assets into the blockchain. A few weeks ago, Mantra reached a deal with a leading real estate company in Dubai, which will use its technology to tokenize its properties.

Analysts believe that tokenization could be a big thing since it will let users create illiquid assets like real estate into tokens. It will also be used by banks and companies in the financial services industry. Already, Franklin Templeton, a company with over $1.65 trillion in assets launched the Franklin OnChain U.S. Government Money Fund, a tokenized fund that uses Stellar’s blockchain.

Mantra staking yield is rising

Mantra net staking inflows

Meanwhile, Mantra is accumulating more assets into its staking ecosystem. Data by StakingRewards shows that it has a staking market cap of $1.13 billion, giving it a staking ratio of 49.97%. In contrast, Ethereum (ETH) has a staking ratio of 27% while Toncoin (TON) has a ratio of 24%.

Data shows that OM has one of the biggest staking yields in the industry. Its staking yield has risen to 21.17%, higher than popular cryptocurrencies like Solana (SOL), Polkadot, and Cosmos. Its net staking flow has been positive, with inflows rising in the past consecutive days.

This staking yield means that $10,000 in Mantra will generate $2,117 in its first year and $21,173 in a decade, all factors constant.

🔥 267,000,000 $OM staked on #MANTRA!

That’s ~32% of the OM circulating supply, now staked by our community to strengthen MANTRA’s mission— Bringing Finance Onchain

👀 Get up to a 1.35x multiplier on your staked OM — based on staking time and amount of staked OM:… pic.twitter.com/rtPpQm2FfA

— MANTRA – Tokenizing RWAs (@MANTRA_Chain) July 24, 2024

Mantra has solid tokenomics

Mantra has become a popular cryptocurrency among stakers because of its tokenomics. Unlike other cryptocurrencies that have huge unlocked tokens, Mantra has completed its token unlocks.

Data by CoinGecko shows that Mantra has a circulating supply of over 831 million against a total supply of 888 million, according to CoinGecko.

cryptocurrencies with unlocked tokens like Pendle, Decentraland, Arbitrum, and Sandbox are usually highly dilutive since some of the new tokens usually dilute existing holders. In Mantra’s case, this will likely not happen.

Mantra price forecast

OM chart by TradingView

The daily chart reveals that the OM token price has been in a spectacular rally this year as it moved from $0.02 in January to a record high of $1.40. The token recently crossed the crucial resistance point at $1.10, its highest swing on June 10. By moving above that level, it invalidated a double-top pattern that has been forming.

Mantra token has remained above the 50-day and 100-day moving averages, which is a positive sign. However, most oscillators like the Relative Strength Index (RSI) and the MACD have all pointed downwards.

The token has moved below the second resistance of the Woodie pivot point. It has also formed a three dark crows. Therefore, the Mantra token price will likely continue falling and then retest the key support at $1.10. That would be a break and retest pattern, which is a sign of a bullish continuation.

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