The Solana (SOL)-based decentralized exchange (DEX) Mango Markets has announced its closure after facing a series of regulatory challenges last year. The decision comes in the wake of investigations by the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) following an incident where a trader exploited the protocol for $110 million worth of digital assets in 2022.
The SEC alleged that Mango Markets’ decentralized autonomous organization (DAO) had violated registration provisions and failed to provide essential protections to investors. The regulator claimed that Mango DAO raised over $70 million from unregistered offers and sales of MNGO tokens. Additionally, affiliated entities Blockworks Foundation and Mango Labs LLC were accused of engaging in unregistered broker activities.
As a result of the investigations, Mango DAO, Blockworks Foundation, and Mango Labs agreed to pay a civil penalty of nearly $700,000 to the SEC without admitting or denying the allegations. They also committed to destroying their MNGO tokens and requested the removal of MNGO tokens from trading platforms. Furthermore, a settlement proposal of $500,000 was made to the CFTC.
In a separate development, the trader responsible for the exploitation, Avraham Eisenberg, was found guilty of commodities fraud, commodities market manipulation, and wire fraud. His sentencing hearing has been postponed until April 2025.
Following these regulatory challenges and legal proceedings, Mango Markets has decided to shut down, urging its users to close their positions on the platform. The closure signifies the end of an era for the DEX, which was once a popular choice for decentralized trading on the Solana network.
As Mango Markets bids farewell, the crypto community reflects on the impact of regulatory scrutiny on decentralized exchanges and the importance of compliance in the evolving landscape of digital assets. The closure serves as a reminder of the need for transparency and accountability in the crypto space to ensure the protection of investors and the integrity of the market.
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