Solana-based decentralized exchange Mango Markets has announced its closure. On January 11, Mango Markets shared on its X account: “We are shutting down. It’s time for users to close their positions.” The decision follows governance proposals that unanimously supported adjustments to interest rates and collateral requirements, effectively terminating borrowing and lending services. These changes will take effect on January 13. SEC Settlement The shutdown comes after a settlement with the US Securities and Exchange Commission (SEC). On September 27, 2024, the SEC filed charges against Mango DAO and the Blockworks Foundation for selling unregistered securities. According to the SEC, Mango raised over $70 million in August 2021 by selling MNGO governance tokens in violation of the Securities Act of 1933. The SEC also accused Mango Labs of operating as an unregistered broker, breaching the Securities Exchange Act of 1934. As part of the settlement, Mango DAO agreed to pay $700,000 in penalties, destroy its MNGO tokens, and request the delisting of these tokens from exchanges. “Since the inception of our crypto enforcement program, our view has been that the label ‘DAO’ does not change the reality of who is behind a project,” said Jorge Tenreiro, chief of the SEC’s Crypto Assets and Cyber Unit. Legal and Financial Struggles Mango Markets’ difficulties date back to an October 2022 exploit by crypto trader Avraham “Avi” Eisenberg, who drained over $100 million from the platform. Although Eisenberg returned $67 million as part of a governance vote, he kept $40 million. US authorities arrested Eisenberg in December 2022, charging him with fraud and market manipulation. He faces up to 20 years in prison, with his sentencing delayed multiple times due to legal complexities. Mango Markets was launched in August 2021, offering fast and affordable trading and lending services using its MNGO governance token. At the time of writing, the platform holds $9 million in total value locked, a sharp decline from its $210 million peak in November 2021, according to DefiLlama.
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