• Avraham Eisenberg, an exploiter of the Mango (MNGO) markets, was recently arrested in Puerto Rico on charges related to market manipulation and fraud.
• Eisenberg is accused of taking advantage of a loophole on the DeFi trading platform Mango Markets and making away with $110 million worth of crypto.
• The arrest has drawn reactions from the crypto community, particularly regarding the terms of the charges he faces, which include commodities fraud.
Avraham Eisenberg, an exploiter of the Mango (MNGO) markets, was recently arrested in Puerto Rico on charges related to market manipulation and fraud. The arrest came after the crypto investor allegedly took advantage of a loophole on the DeFi trading platform Mango Markets and made away with $110 million worth of crypto. The mid-October exploit resulted in the platform becoming insolvent, leading to Eisenberg’s arrest on Monday.
Eisenberg claims that he and his team had only „operated a highly profitable trading strategy“ and that all their market actions were legally permitted by the protocol. However, these claims will be determined by relevant authorities. Eisenberg’s arrest has unsurprisingly drawn reactions from the crypto community, particularly regarding the terms of the charges he faces.
It is noteworthy that in such a case involving a coin such as Mango Markets‘ native token MNGO, Eisenberg has been charged with commodities fraud. According to the US Commodity Futures Trading Commission (CFTC), commodities fraud is defined as “any deceptive or fraudulent representation, act, or omission in connection with futures or option trading.” This means that the CFTC views cryptocurrencies as commodities, and has the authority to police fraud and manipulation in the crypto markets.
This is not the first time the government has taken action against a crypto exploiter. In July 2020, the US Department of Justice charged two men for their involvement in a $722 million cryptocurrency fraud. It is also not the first time that Eisenberg has been accused of fraud. In 2018, he faced similar charges for his involvement in a $50 million scam involving cryptocurrency investments.
Eisenberg’s arrest indicates a growing trend of government authorities cracking down on fraudsters in the crypto space. It is essential that crypto investors and traders remain aware of the risks associated with investing in digital assets and be mindful of any suspicious activities in the markets. It is also essential that they understand the legal implications of their trading and investing activities, to ensure that they remain in compliance with all applicable laws and regulations.