The Mango DAO reportedly ‘died’ last week after John Kramer and Max Schneider gained significant voting control while also allegedly violating a settlement with the Securities and Exchange Commission (SEC).
The pair successfully completed a proposal last Saturday to distribute 67.5 million MNGO options after locking up 80 million tokens. However, Mango Labs founder Dafydd Durairaj claims their proposal “would likely count as a sale of MNGO and would jeopardize our settlement with the SEC.”
He advocated against the proposal in the Mango DAO Discord, claiming, “The SEC could reopen the case, and we might face consequences from the court for violating the settlement. This puts all of us in grave jeopardy.”
The proposal also “cements their total control over the DAO,” and allows them to outvote proposals with a large majority of votes. X user @Henry_E__ posted, “RIP Mango DAO 2021-2024,” and said the pair’s proposal “marks the effective end of Mango DAO.”
In the Mango DAO discord, Schnieder claimed his request for a distribution of a “so far vested grant” shouldn’t break the SEC proposal as “This is a pre-existing agreement of the DAO, it should be honored now.”
The proposals requested 60 million and 7.5 million token options for payments it claims were due on October 4 and November 17 respectively. Schnieder also said the proposal won’t give him a voting majority and claims Durairaj is “talking nonsense to distract people and enrich yourself by breaking every promise you gave me.”
The settlement with the SEC dictates that Mango DAO, Blockworks Foundation, and Mango Labs must destroy their MNGO tokens, pay a $700,000 fine, and make sure no other platforms trade the token.
The entities neither admitted nor denied the unregistered security allegations the SEC brought against them.
Read more: MNGO from FTX estate vote for Mango Markets buyback proposal
Schnieder and Kramer are core Mango DAO members. A lawsuit filed by Mango Labs in October accuses the pair of embezzling $10 million from the DAO during the trial of Avraham Eisenberg, another major figure in Mango’s history who was found guilty of fraudulently obtaining $110 million.
Last October, the Mango DAO had just avoided falling foul of the SEC’s settlement after a proposal to pay the SEC fine was rejected. Fortunately, a follow-up proposal was later accepted.
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Source: https://protos.com/has-mango-dao-died-while-violating-its-sec-settlement/