Daniel Walker
Mango DAO has reached a settlement with the U.S. Securities and Exchange Commission (SEC) following charges of unlawfully selling its MNGO tokens. The SEC had accused Mango DAO and Blockworks Foundation, a Panama-based entity, of conducting an unregistered sale of crypto assets through the Mango Markets platform. Additionally, the SEC charged Blockworks Foundation and Mango Labs LLC for operating as brokers without proper registration.
All three partiesโMango Labs, Mango DAO, and Blockworks Foundationโhave agreed to the settlement, which includes paying $700,000 in penalties. They also consented to the destruction of their MNGO tokens.
Jorge G. Tenreiro, acting chief of the SECโs Crypto Assets and Cyber Unit, highlighted that using the label “DAO” does not exempt a project from legal scrutiny or regulatory requirements. He emphasized that utilizing automated or open-source software to intermediate securities doesnโt alter the need for proper registration. In a statement, Tenreiro reinforced the SECโs stance on this matter, saying, “The label โDAOโ does not change the reality of who is behind a project or the nature of the activities they engage in.”
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In its complaint, the SEC also referred to SOL, a token sold on Mango Markets, as a security. This is consistent with previous actions by the SEC, which has classified several cryptocurrencies, including SOL, as securities in other legal cases, such as its ongoing lawsuit against Binance.
This settlement follows an incident two years ago when Avraham Eisenberg was accused of exploiting vulnerabilities in Mango Markets, leading to losses of approximately $116 million on the platform.
