Mango Markets, a decentralized finance (DeFi) platform operating on the Solana blockchain, has announced its impending shutdown following a significant exploit that drained $117 million in 2022. The decision to wind down operations was overwhelmingly supported by the community, with 23,347,212 governance votes in favor.
The shutdown process will commence on January 13, 2025, at 8 PM UTC, giving users their final opportunity to close any open positions. Ahead of the shutdown, Mango Markets will implement drastic changes, including tightening lending protocols and increasing collateral requirements.
In a bid to curtail further risks, Mango V4 will drastically reduce its target lending ratio from 50% to just 0.1% of deposits. It will also impose sharp interest rate hikes on key tokens like SOL, USDC, USDT, and ETH. Collateral requirements will be raised tenfold, making it increasingly difficult for users to open new positions.
The closure comes after a highly publicized exploit in October 2022, when hacker Avraham Eisenberg manipulated the price of MNGO tokens by a staggering 1,000%. Using just $5 million in USDC, Eisenberg was able to borrow against the inflated collateral, ultimately draining $117 million from the platform.
Despite Mango Markets’ attempts to recover the stolen funds, including offering a bug bounty, the money was never returned. Legal action against Eisenberg began in October 2024, with charges including fraud and market manipulation that could lead to a 25-year prison sentence.
Eisenberg defended his actions as a “profitable trading strategy” and even attempted to secure a portion of the stolen funds through a governance proposal. However, the community’s unanimous vote to shut down Mango Markets signals the final chapter for the platform, which has experienced a tumultuous path since the exploit.
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