The decentralized exchange (DEX) Mango Markets, which is based on Solana (SOL), is closing down due to a series of regulatory issues it faced last year.
The closure of Mango Markets was announced on Saturday, along with proposals aimed at making borrowing on the platform economically unviable.
“Mango Markets will be shutting down. It is time for users to close their positions.”
In 2022, the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) initiated investigations into Mango Markets after crypto trader Avraham Eisenberg exploited the protocol, resulting in the loss of $110 million worth of digital assets.
The SEC claimed that the decentralized autonomous organization (DAO) of Mango Markets evaded registration requirements and failed to provide investors with necessary protections.
The regulator stated that Mango DAO raised over $70 million through unregistered offers and sales of MNGO tokens. It also alleged that affiliated entities, Blockworks Foundation and Mango Labs LLC, engaged in unregistered brokerage activities.
In September, Mango DAO, Blockworks Foundation, and Mango Labs agreed to pay the SEC a civil penalty of nearly $700,000, without admitting or denying the allegations. They also agreed to destroy their MNGO tokens and request the removal of MNGO tokens from trading platforms. Furthermore, the DAO voted to propose a $500,000 settlement with the CFTC.
Eisenberg was convicted of commodities fraud, commodities market manipulation, and wire fraud by a jury in April. His sentencing hearing has recently been postponed until April 2025.
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