SEC Takes Action Against Mango Markets: $700K Settlement Reached Amid Controversies
The U.S. Securities and Exchange Commission (SEC) revealed on Friday that it has charged the teams behind the Solana-based decentralized finance (DeFi) platform, Mango Markets, including Mango DAO, Mango Labs, and the Blockworks Foundation, with securities violations after an extensive investigation.
The parties involved have reached a settlement, which was approved by MNGO token holders in August. They are set to pay almost $700,000 in civil penalties, agree to eliminate their MNGO tokens, request their removal from trading platforms, and refrain from promoting any trading of MNGO.
Mango DAO and the Blockworks Foundation faced charges for the offering and selling of MNGO tokens, while Mango Labs and the Foundation were cited for acting as unregistered brokers. This settlement follows a notorious exploit in 2022 when a hacker stole $110 million from the platform by manipulating collateral values, leading to loans being drawn from Mango’s treasury.
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Avraham Eisenberg, accused of orchestrating the hack, was convicted of fraud in April. His defense claimed that risky DeFi exploits like this should not fall under current U.S. criminal law, marking the case as a notable instance of digital asset manipulation in the crypto sector.
The Commodity Futures Trading Commission (CFTC) also filed charges against Eisenberg and the protocol. Recently, Mango Markets users voted to acknowledge no wrongdoing in a CFTC settlement while agreeing to pay a $500,000 fine. Jorge G. Tenreiro, the SEC’s acting chief for the crypto assets and cyber unit, emphasized that a project’s designation as a DAO does not exempt its creators from regulatory obligations.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
