Hello Mango DAO, I’m requesting $2m in additional funding for Mango Labs. This funding is necessary to handle legal costs of regulatory inquiries that have arisen after the exploit last year, cooperation with law enforcement and regulators, and pursuing legal claims against Avi Eisenberg to help recover funds for the DAO.
The previous $2m in funding went primarily towards legal expenses for the civil suit against Eisenberg for his role in the exploit, responding to regulatory inquiries that followed, the Mango v4 security audit, and salaries for app devs. Given market conditions, we’ve decided to discontinue development of the payments app. There are currently two developers on payroll at Mango Labs for UI and database development.
If any portion of these funds is not used within one year from the date that the proposal is granted, those funds shall be returned to the DAO treasury.
A bit surprised to see this come up after 6 months, as the last funding request was for one year. Clearly this project is running over budget, and given it’s outsized impact on the DAO treasury, I would appreciate if you could implement the following measures to make spending more transparent and assure cost effectiveness:
Quarterly report retroactively (spend & results)
Quarterly vesting & report going forward
Review spend so far, propose & commit to implement cost saving measures for future
A few ideas for the third one, without knowing the details:
a) try to reduce headcount
b) participate in meetings and watch the clock
Agree with Max, especially with respect to (3) the accountability - it would be valuable for the DAO to have further details where the funds are being spent. There is not enough substance yet to make an educated decision whether continuing the burn rate on attorneys is beneficial long term. At a minimum, a breakdown of funds spent towards the goal of asset recovery vs personal and collective protection would help frame the request.
I’m following up on the initial proposal for $2m in additional funding for Mango Labs in response to your requests for more information.
As mentioned, there have been several areas of legal expense as a result of the attack from Avi Eisenberg. Following the attack, Mango Labs engaged attorneys that helped recover $67m in funds that were used to make the victims of the attack whole. Those victims assigned their claims to Mango Labs so that Mango Labs could pursue a civil case against Eisenberg. That case is ongoing.
There is also a criminal case that the Department of Justice has filed against Eisenberg. That case is scheduled for trial in December. Part of the legal budget I’m requesting will go towards preparing for that trial as victim of the exploit whose testimony may be sought.
There are also several regulatory actions and inquiries that have arisen following Eisenberg’s attack. The SEC and CFTC have both filed their own cases against Eisenberg, both of which contain allegations related to Mango Markets and therefore warrant attention from counsel.
Here’s an estimated breakdown of expenses this year–as noted previously, this includes both sums already covered by previously allocated funds and outstanding bills that would be covered by a portion of the requested $2 million:
V4 Audit - 210k
Mobile app (discontinued) - 330k
Other Developers - 149k
Infrastructure - 17k
Q1 legal - 975k
Q2 legal - 653k
Going forward, I will aim to provide additional information as I am able. I have also been working to manage the legal spend to maximize efficiency and am committed to continuing to do so as the matters proceed. I will provide additional information and public updates on the legal matters more frequently going forward.
I sincerely think the expenses can be better explained than this. And I am sure if you have spent 2million dollars in roughly 6months you will have receipts for those to share with mngo holders.