The U.S. Securities and Exchange Commission (SEC) declared a settlement with Solana-based DeFi platform Mango DAO and Blockworks Foundation for selling unregistered crypto assets known as “MNGO” tokens.
Settlement Details with SEC
As part of the agreement, Mango DAO, Blockworks Foundation, and Mango Labs collectively agreed to pay a civil penalty of $700,000. Additionally, they committed to demolishing their MNGO tokens, requesting their removal from exchanges, and stopping any future promotion of these tokens. Notably, the settlement was reached without any admitting or denial of the allegations, and it remains subject to court approval.
Allegations Against Mango DAO
The SEC’s complaint highlighted that Mango DAO, registered as a decentralized autonomous organization, and the Panamanian entity Blockworks Foundation raised over $70 million through unregistered offerings of MNGO tokens starting in August 2021. This token is a governance asset for the Mango Markets platform, and it sold to numerous investors worldwide, including the US. The complaint also claimed that Blockworks Foundation and Mango Labs operated as unregistered brokers, promoting Mango Markets and assisting users in trading securities.
Mango DAO Community Decision
In August 2024, the Mango DAO community voted to settle with the SEC and destroy MNGO tokens. Later, in September, Mango Markets offered $500,000 to settle a separate investigation by the Commodity Futures Trading Commission (CFTC).
The settlement with the SEC underscores the importance of complying with federal registration requirements, ensuring investor protection and market transparency in the cryptocurrency space.
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