Mango Markets Hacker Faces 20 Years In Prison

Key Points:

• Mango Markets hacker Avraham Eisenberg was found guilty of fraud and manipulation in a $110 million scheme.
• This marked the first test for traditional U.S. laws on fraud and market manipulation in the DeFi realm.
• Eisenberg’s conviction adds to the legal scrutiny facing cryptocurrency figures.

According to Reuters, Avraham “Avi” Eisenberg, a 28-year-old cryptocurrency trader, was found guilty on Thursday of fraud and manipulation charges related to a $110 million scheme involving the Mango Markets platform.

Mango Markets Hacker Convicted in $110 Million Fraud Case

This landmark case marked the first time a jury assessed whether traditional U.S. laws on fraud and market manipulation applied to decentralized finance (DeFi).

The jury, in a federal court in Manhattan, convicted the Mango Markets hacker of all three counts: commodities fraud, commodities manipulation, and wire fraud. Prosecutors argued that Eisenberg rigged the price of MNGO tokens on Mango Markets to execute his fraud plan.

Assistant US Attorney Thomas Burnett emphasized Eisenberg’s manipulation of token prices to deceive the system and secure illicit gains.

Despite Eisenberg’s claims of innocence and compliance with decentralized protocol rules, the jury sided with prosecutors, describing his actions as “brazen” fraud and manipulation. Following the verdict, Eisenberg’s attorney, Brian Klein, expressed disappointment but vowed to continue legal battles through post-trial motions.

Eisenberg Joins List of Convicted Figures

Eisenberg’s arrest in Puerto Rico in December 2022 stemmed from his alleged involvement in exploiting Mango Markets’ decentralized crypto exchange. Prosecutors highlighted Eisenberg’s use of multiple accounts to inflate token values, enabling him to withdraw $110 million in various cryptocurrencies. In a bid to avoid prosecution, the Mango Markets hacker agreed to return $67 million in crypto assets.

The conviction of Eisenberg adds to a growing list of cryptocurrency figures facing legal consequences for fraudulent activities. This includes FTX founder Sam Bankman-Fried‘s recent conviction and a 25-year sentence, along with Terraform Labs co-founder Do Kwon‘s civil fraud liability ruling. Eisenberg faces a potential 20-year prison sentence at his scheduled sentencing in July.