Mango DAO Settles with SEC

Mango DAO has reached a settlement with the U.S. Securities and Exchange Commission (SEC) following charges of unlawfully selling MNGO tokens.

The SEC’s allegations included Mango DAO and Blockworks Foundation, a Panama-based entity, for “engaging in the unregistered offer and sale of crypto assets” related to governance tokens on the Mango Markets platform. Additionally, the SEC settled charges against Blockworks Foundation and Mango Labs LLC for operating as an unregistered broker.

As part of the settlement, the three entities — Mango Labs, Mango DAO, and Blockworks Foundation — agreed to pay a total of $700,000 in penalties and to destroy their MNGO tokens.

Jorge G. Tenreiro, acting chief of the Crypto Assets and Cyber Unit, stated, “Since the inception of our crypto enforcement program, our view has been that the label ‘DAO’ does not change the reality of who is behind a project, what activities they engage in, or whether their activities need to be registered. Nor does engaging in intermediation of securities with the aid of automated or open-source software change the nature of such activities.”

The SEC’s complaint also noted that SOL, which is sold on Mango Markets, is classified as a security. This follows previous claims by the agency categorizing SOL and other cryptocurrencies as securities in a separate lawsuit involving the crypto exchange Binance.

This settlement follows a two-year investigation after Avraham Eisenberg, who has since been convicted, was accused of exploiting Mango Markets, leading to a loss of approximately $116 million in funds.

Update: Sept. 27, 7:40 p.m. UTC to include details throughout