The U.S. Securities and Exchange Commission (SEC) has reached a settlement with Mango Markets, Mango DAO, and Blockworks Foundation regarding the unregistered sale of MNGO tokens. The SEC charged these companies with violating U.S. securities laws for failing to provide necessary protections to investors. This is an important development for Mango Markets.
SEC Action on Unregistered MNGO Token Sales
The SEC’s enforcement action targets the sale of MNGO tokens, which were promoted as governance tokens on the Mango Markets platform. The consensus involves Mango DAO, a decentralized autonomous organization, and the Panama-based Blockworks Foundation. According to the SEC, the group raised more than $70 million through unregistered sales of MNGO tokens that have been ongoing since August 2021.
These companies sold MNGO tokens globally, including to US investors. The SEC alleges that the company violated key provisions of the Securities Act of 1933 by circumventing federal registration requirements. The bill would require projects offering cryptocurrency assets considered securities to register, ensuring investors receive essential legal disclosures and protections. This was a notable issue in Mango Markets’ strategy.
What is MNGO Token?
Mango Markets sold MNGO tokens as governance tokens, giving holders the power to make decisions within the ecosystem. But the SEC argues that their sales constitute securities offerings under U.S. law and that registration is required to protect investors. The lack of registration and disclosure means that investors do not have the legal protections typically provided by the SEC. Questions have been raised about Mango Markets’ classification of MNGO tokens.
meaning of agreement
The settlement highlights the SEC’s growing focus on strengthening compliance in the cryptocurrency space. As cryptocurrency projects expand globally, regulators are cracking down on unregistered token sales and ensuring investors have the legal protection they need. The outcome of this case serves as a warning to other decentralized finance platforms, such as Mango Markets, that operate outside of established U.S. law.
There will be more updates soon…