Mango Markets is a platform hosted on Solana that was once known as a leading decentralized exchange. However, things changed after a $110 million hack last year. After this incident, the platform’s governing body, Mango DAO, decided to submit a settlement proposal to the SEC. This proposal would require the platform to stop trading MNGO tokens and pay a fine of $223,228.

The proposed deal comes after several regulators in the US began reviewing the protocol. Mango DAO has called for a vote on the proposal, which could leave the platform’s future uncertain. In particular, the cessation of trading of MNGO tokens poses a serious threat to Mango Markets’ operations.

Mango Markets has been dealt a serious blow after a major $110 million hack by Avraham Eisenberg. Following this attack, Eisenberg faces charges of fraud and market manipulation. The US Department of Justice (DOJ), SEC, and Commodity Futures Trading Commission (CFTC) have begun investigating Eisenberg’s role in the incident. At the same time, several regulatory bodies have also begun investigating Mango Markets.

The SEC alleges that Mango DAO violated Sections 5(a) and 5(c) of the Securities Act of 1933. Mango Labs and the Blockworks Foundation are also accused of violating Section 15(a) of the Securities Exchange Act of 1934.

Details of the Settlement Offer

The proposal submitted by Mango DAO emphasizes that the DAO should not continue to violate Sections 5(a) and 5(c) of the Securities Act of 1933. The DAO will also be required to withdraw all MNGO tokens from trading and cease trading in these tokens completely within 10 days of the finalization of the agreement. It is stated that the DAO will maintain transparency in this process, but that there may be restrictions on the information shared due to privacy rules.

The acceptance of this proposal could have a significant impact on Mango Markets’ operations. In particular, the disappearance of the MNGO tokens used in the platform’s decision-making processes creates great uncertainty for Mango Markets’ future. It could also set a new precedent for DeFi protocols’ relationships with securities regulators.

The increasing regulatory pressures in the crypto space show that even projects like Mango Markets are unable to escape these pressures despite trying to avoid US investors. If this proposal is accepted, it is likely that other protocols operating in the DeFi world will follow a similar regulatory path.