Mango Markets, a decentralized exchange (DEX) based on the Solana blockchain, is contemplating a settlement with the United States Securities and Exchange Commission (SEC) in response to allegations of securities law violations.
On August 19, Mango DAO, the governance body overseeing the platform, initiated a vote to determine whether to propose a settlement to the SEC. The vote has seen considerable engagement from the community, with a strong majority supporting the settlement proposal.
The proposed settlement from Mango DAO is designed to address various concerns raised by the SEC. It includes a plan to destroy its MNGO tokens, pay fines, and request the delisting of these tokens from trading platforms. The proposal has gained substantial backing, with over 106 million votes in favor, reflecting a broad consensus among the community members for resolving the ongoing regulatory issues.
Mango Markets Weighs SEC Settlement with Plans for Token Destruction and Fines
The platform’s troubles began in October 2022 when a trader named Avraham Eisenberg exploited the protocol to steal $110 million. Eisenberg was later convicted of fraud and market manipulation in April 2024. This incident not only severely impacted Mango Markets but also drew attention from multiple regulatory agencies, including the SEC, which subsequently launched investigations into the platform’s activities.
The SEC’s probe into Mango DAO, Mango Labs, and the Blockworks Foundation concluded that these entities had violated securities regulations. To resolve these allegations, Mango DAO has proposed paying a $223,228 civil penalty from its treasury, which holds nearly $2 million in assets. The settlement would require Mango DAO to neither admit nor deny the SEC’s claims, a typical condition in such agreements.
If the SEC accepts the settlement proposal, Mango DAO would cease all sales and resales of MNGO tokens in the U.S., destroy any remaining tokens, and request their delisting from exchanges. This move is intended to avoid extended litigation and mitigate ongoing regulatory scrutiny.
Meanwhile, Eisenberg’s recent legal efforts to overturn his conviction could further complicate the regulatory and legal challenges faced by Mango Markets, whose MNGO token has depreciated significantly from its all-time high.
