Mango DAO Proposes $223K Settlement with SEC, Voting Reaches Quorum

Mango DAO is considering a $223K settlement with the SEC to resolve allegations of securities violations, proposing to destroy MNGO tokens and delist from exchanges.

Mango Markets DAO is currently deliberating on a potential settlement offer with the United States Securities and Exchange Commission (SEC) over claims that the platform violated U.S. securities laws. The proposed settlement, which involves neither admitting nor denying any wrongdoing, includes a $223,228 fine, the destruction of MNGO tokens, and delisting from trading platforms.

The decentralized autonomous organization (DAO) that manages the Solana-based decentralized exchange (DEX) initiated voting on the “SEC Settlement Offer Proposal” on August 19. As of now, with more than two days left for voting, the proposal has already achieved a quorum with 106,717,813 votes, all in favor.

Mango Markets has faced significant challenges since October 2022, when trader Avraham Eisenberg exploited a vulnerability in the protocol, resulting in a $110 million loss. Eisenberg was later found guilty of fraud and manipulation in April. Following the incident, the SEC, Department of Justice, and Commodity Futures Trading Commission launched investigations into the platform. The SEC has accused Mango DAO, Mango Labs, and Blockworks Foundation of violating various securities regulations.

The proposed settlement involves Mango DAO paying a $223,228 civil penalty from its treasury, which currently holds nearly $2 million in USD Coin (USDC) and other assets. The DAO would also cease all offers, sales, and resales of MNGO tokens in the United States, destroy any remaining tokens in its possession, and request their delisting from all exchanges.

This settlement offer is intended to avoid prolonged litigation and resolve the SEC’s allegations without admitting any fault. However, the proposal has not yet been accepted by the SEC.

In a related development, Eisenberg recently filed a motion for judgment of acquittal, arguing that his actions on Mango Markets were legal and not fraudulent or manipulative.

Notably, Mango Markets’ $70 million token sale in 2021 was reportedly not available to U.S. investors to avoid regulatory scrutiny. Despite the current legal challenges, MNGO token prices saw a 5.3% increase on the day, trading at $0.015 at the time of writing. However, this is still 97% below its all-time high of nearly $0.50 in September 2021.

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