The U.S. Securities and Exchange Commission (SEC) has settled a lawsuit against Mango DAO, Mango Labs LLC, and Blockworks Foundation over allegations that the MNGO token was presented as an unregistered security and that the parties engaged in unregistered brokerage services.
Under the agreement, these organizations will destroy their MNGO tokens and request that cryptocurrency exchanges cease trading of the token. They will also agree to pay a total of $700,000. The agreement is subject to court approval, it was stated.
The Mango DAO reportedly held a vote on whether to accept the deal a little over a month ago. In addition, the DAO unanimously approved a proposed deal with the U.S. Commodity Futures Trading Commission (CFTC) earlier this week.
Mango DAO members vote on project decisions using the MNGO governance token, but it is not yet clear how the project will proceed without the token, as its future is uncertain.
$70 Million Token Sale
According to the SEC’s disclosures, Mango DAO and Blockworks Foundation sold a total of $70 million worth of MNGO tokens as of August 2021.
“Any entity that offers securities brokerage activities must register with the SEC or be exempt from such registration,” Jorge Tenreiro, the SEC’s Crypto and Cyber Division Director, said in a statement.
