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- Mango Markets shuts down after SEC settlement citing regulatory violations and unresolved challenges from a prior exploit.
- Mango DAO agrees to SEC settlement, ending operations to avoid prolonged litigation and comply with regulatory demands.
Mango Markets, a Solana-based decentralized exchange (DEX), will shut down operations today following a settlement agreement with the Securities and Exchange Commission (SEC).
With its closing, a platform that had been essential in the decentralized finance (DeFi) market loses relevance under operational difficulties and regulatory scrutiny. After months of negotiating legal conflicts and handling the fallout from a significant hack seriously compromising the integrity of the site, the decision to stop running arrives.
🚨JUST IN: MANGO MARKETS, A SOLANA-BASED DECENTRALIZED EXCHANGE, TO SHUTDOWN TODAY FOLLOWING SEC SETTLEMENT
— BSCN Headlines (@BSCNheadlines) January 13, 2025
Mango Markets Faces Regulatory Scrutiny and SEC Settlement After Major Hack
In October 2022, Mango Markets underwent a significant transformation following a $110 million hack. Avraham Eisenberg, who later came under accusations of fraud and market manipulation, used this hack to manipulate the collateral values of the platform.
The episode drew regulatory scrutiny, especially on the platform’s compliance with U.S. securities laws, even while it showed weaknesses in DeFi systems. Later on, the SEC claimed that MNGO, the native token of Mango Markets, was an unregistered security, so breaking federal securities laws.
Mango DAO, the body running Mango Markets, suggested a deal with the SEC in order to clear these accusations. This settlement demanded that the DAO pay a civil penalty of $223,228, stop all MNGO token activity, destroy any last tokens, and ask any trading platforms to delist any remaining tokens.
Citing the necessity to prevent protracted litigation and more reputation damage, the DAO members endorsed the proposition most of the time. This agreement decided to stop running the platform since it essentially cemented its future.
For other DeFi platforms, especially those running inside countries with rigorous regulatory control, the closing of Mango Markets acts as a sobering lesson. It emphasizes the increasing difficulties decentralized systems have in balancing compliance with innovation.
Furthermore, this development has major consequences for the Solana ecosystem, which is well-known for supporting several fast-paced, innovative DeFi initiatives.
