Mango Markets, one of the decentralized exchanges on the Solana blockchain, announced its shutdown on January 11, 2025. Users are advised to close their positions before the platform officially ceases all operations on January 13.
Reasons for this decision
The collapse of Mango Markets stemmed from legal and financial issues. In September 2024, the U.S. Securities and Exchange Commission (SEC) accused Mango DAO and Blockworks Foundation of violating the Securities Act of 1933 by selling governance tokens MNGO worth over $70 million without registration. Additionally, Mango Labs was also accused of operating as an unregistered broker, violating the Securities Exchange Act of 1934.
To resolve, Mango DAO has agreed to pay a fine of $700,000, burn MNGO tokens, and propose delisting from exchanges. Previously, the platform also faced a significant attack in October 2022, when Avraham “Avi” Eisenberg exploited a vulnerability to withdraw over $100 million. Although part of the amount was returned, this incident caused significant losses and diminished community trust.
The Future of DeFi and Lessons from Mango Markets
The shutdown of Mango Markets is not only a shock to the Solana ecosystem but also a warning for DeFi projects about the importance of regulatory compliance and ensuring financial security.
This is evidence that regulators, such as the SEC, are tightening oversight of DeFi platforms. To survive and grow, projects must not only innovate technologically but also comply with the law and build trust with users.
The case of Mango Markets will continue to be a valuable lesson for the decentralized finance sector amidst increasing legal challenges.
#SEC #MangoMarkets
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