Whenever a Shadow Clone uses an ability that would initially have a mana cost, that mana cost is subtracted out of your mana pool when using Coated Blades. This could also be happening without coated blades, but it seems like a bug, since nowhere does it state that YOU cast these abilities, your shadow clones does.
Examples: Synchronized Strikes creates 4 Shadows with the Dark Allies skill-talent. Using Shadow Cascade with 8/8 Coated Blades causes each shadow to consume 55 Mana, rather than you only paying the cost of the actual shadow Cascade.
When you do not have Coated Blades, this doesn’t appear to happen.
When using Shift with the Lasting Presence and Dancing Shadows skill-talent, despite not costing mana normally, it causes the ability to cost its normal mana (10), regenerate mana from Swift Recovery (16), then 40 Mana from each trigger of Shadow Cascade. Video will be included.
If I had to guess, what is happening is that Coated Blades is simply adding +40 Mana to the cost whenever an ability that costs mana and deals damage is casted, instead of when the player uses it. As a result, abilities that should be free such as Shadows using Shadow Cascade, are instead costing 40 Mana each.