Avraham ‘Avi’ Eisenberg, a figure in the digital finance sector, was found guilty in connection with a major security breach at Mango Markets in which more than $110 million was compromised.
In December 2022, Eisenberg was arrested in Puerto Rico on charges of commodity fraud, market manipulation, and wire fraud related to the Mango Markets exploit. The incident occurred in October 2022 when Eisenberg injected $5 million USDC stablecoin into Mango Markets.
According to the court ruling, Eisenberg manipulated the price of the platform token, MNGO, causing the price to soar by approximately 1,000% in one hour. The artificial increase allowed him to borrow or withdraw additional tokens, which created a significant negative debt position on the platform.
Days after the attack, Eisenberg claimed that his actions were part of a legitimate and highly profitable trading strategy, leveraging the platform’s features as intended. He later returned $67 million to Mango Markets and kept $47 million following a community governance vote.
The trial, which began on April 9, lasted just over a week. In court, his lawyers argued that Eisenberg used a legitimate trading strategy, but prosecutors branded his actions fraudulent, according to Bloomberg.
During the trial, the British customer testified that he suffered a loss of $124,000 due to being unable to withdraw his funds.
“DAOs don’t work that way. “There is no one to talk to,” customers said, reflecting the decentralized core of such platforms.
Bloomberg also said jurors saw evidence that Eisenberg searched online for market manipulation crimes and FBI surveillance terms. Mango Markets ultimately lost approximately $116 million as a result of the exploit.
According to CoinGecko, the price of MNGO is currently sitting at $0.0289, up 14% in the last 24 hours.