Creative Translation: “Mango Protocol Exploiter Avraham Eisenberg Found Guilty of Fraud by US Court”

Creative Translation: "Mango Protocol Exploiter Avraham Eisenberg Found Guilty of Fraud by US Court"

Creative Translation: "Mango Protocol Exploiter Avraham Eisenberg Found Guilty of Fraud by US Court"

According to Bloomberg, Avraham Eisenberg, a trader accused of using a vulnerability on the decentralized finance platform Mango Markets to steal $110 million, has been found guilty of fraud in the first criminal trial in the United States involving cryptocurrency manipulation.

A federal jury in New York on Thursday (18th) convicted Avraham Eisenberg of commodity fraud, commodities manipulation, and wire fraud for his trading activities on October 11, 2022. The sentencing is scheduled for July 29th. He faces 20 years in prison for wire fraud and 10 years for the other charges.

Prosecutors alleged that Eisenberg, who claimed to be an “applied game theorist,” conducted trades on Mango Markets using a false identity, artificially inflating the price of Mango’s native token MNGO and perpetual futures contracts. He then utilized a feature on the platform that allowed him to “borrow” his held assets and withdrew $110 million worth of cryptocurrency without intending to repay it. Eisenberg later negotiated with Mango DAO and agreed to return $67 million.

In related news, hackers exploited a vulnerability on the DeFi platform Mango, resulting in losses exceeding $100 million, with initial funding coming from FTX. The hacker also proposed on the governance forum.

The prosecution stated that Eisenberg “pumped” the price of MNGO tokens, enabling him to carry out his planned fraudulent activities on Mango Markets for several weeks, with the intention of taking the money and running. Following the verdict, Eisenberg’s lawyer Brian Klein issued a statement, saying, “We are obviously disappointed, but we will continue to fight for our client. We plan to file a series of post-trial motions.”

Klein stated that his client executed a completely legal strategy, fully complying with the smart contract governing Mango Markets, which warned users that “this is unaudited software, use at your own risk.” However, Assistant U.S. Attorney Thomas Burnett argued that Mango Markets’ platform rules cannot shield Eisenberg from charges of fraud and manipulation.

In related news, the identity of the Mango exploit user has been confirmed. They released a statement claiming that their “high-profit trading strategy” was completely legal.