Mango Markets Exploiter Detained For Alleged Market Manipulation
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Eisenberg Detained For Market Manipulation
The Federal Bureau of Investigation (FBI) charged Avraham Eisenberg with one count of commodities deception and one count of commodities manipulation in connection with his exploitation of Mango Markets, according to a formerly confidential petition lodged with the Southern District of New York, which was publicly revealed on December 27.
According to an allegation accusing him, Eisenberg oversaw a group that exploited Mango Markets in October for $114 million by inflating the value of MNGO, the exchange's native cryptocurrency. Eisenberg amassed a significant holding in MNGO, driving up its price by 1,300%, which enabled him to acquire other tokens with greater market capitalization and more consistent value using the same network with no plan to pay them off.
Token Value Drop Scenario
Eisenberg's position lost its worth when MNGO's value dropped once again, making it impossible for him to pay back the loans he had taken out in those other tokens. He identified himself at the time as the person responsible for the dramatic increase in MNGO's price, claiming that he was using the system as planned, even though the project team did not foresee all the repercussions of defining the requirements. Then, users of Mango decided to let him retain $47 million of his bounty while returning the remaining $67 million.
In contradiction to the DeFi theory that code may be its laws, authorities have accused Eisenberg of illegal market manipulation notwithstanding that decentralized settlement. There is no information on probable criminal charges for the remainder of his group.