Solana-Based DeFi Platform Mango Markets Drafts Proposal for Settlement Conditions With SEC

A decentralized finance (DeFi) platform based on the smart contract platform Solana (SOL) is drafting a proposal to settle with the U.S. Securities and Exchange Commission (SEC).

In a new community proposal, the decentralized autonomous organization (DAO) of Mango Markets (MNGO) has voted to settle with the SEC even though the regulator hasn’t formally charged the decentralized exchange (DEX) protocol with any crimes.

However, the SEC and other federal agencies launched an investigation into Mango Markets after crypto trader Avraham Eisenberg exploited the protocol for $110 million in 2022.

According to the Mango DAO, the SEC has accused them of violating several clauses in The Securities Acts of 1933 and 1934.

The DAO goes on to say the settlement, if accepted by the SEC, would include a $233,228 civil penalties payment and an agreement to cease “all of its offers, sales or resales of MNGO tokens on the protocol through the means or instrumentalities of interstate commerce in the United States.”

Furthermore, the protocol would agree to destroy or otherwise make unavailable all MNGO tokens in its possession within 10 days of the SEC’s acceptance of the terms.

“In order to resolve the SEC’s allegations against the DAO, this proposal is to authorize CyberByte sp. z.o.o, which is serving as the Representative of the DAO… to make a binding settlement offer to the SEC on behalf of the DAO which would include the payment of a civil monetary penalty, injunctive relief, and undertakings, to execute the settlement documents on behalf of the DAO, and to execute the undertakings called for by the settlement if accepted by the SEC.

As part of the settlement offer, the DAO would not be admitting or denying the SEC’s allegations.”

Eisenberg was charged and subsequently found guilty of commodities fraud in 2023 after he artificially inflated the price of MNGO and borrowed large amounts of digital assets from the DEX using unrealized profits from his long positions on the token.

MNGO is trading at $0.0162 at time of writing, a 6% increase in the past 24 hours.

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