Key Takeaways:
- Avraham Eisenberg was arrested on Monday in Puerto Rico.
- US DoJ is charging Eisenberg with fraud and market manipulation.
LAGOS (CoinChapter.com) — Avraham Eisenberg, a crypto investor who publicly confirmed his exploit of cryptocurrency platform Mango Markets of assets worth $110 million in October, has been arrested.
In detail, a complaint filed by United States Attorney Damian Williams in the Southern District of New York revealed that Eisenberg was arrested on Monday in Puerto Rico.
The US Department of Justice revealed the arrest on Tuesday, Dec. 27, in a sealed complaint submitted to the US Magistrates Judge Kathrine H. Parker at the Southern District of New York Court. According to the filing, Eisenberg is facing market manipulation and fraud charges.
Recall that Eisenberg, on Oct. 11, exploited Mango Markets, a Solana-based decentralized exchange of about $110 million in various crypto assets. However, after accomplishing his attack, Eisenberg later returned $67 million following negotiating with the Mango team.
As revealed after the attack, Eisenberg and his team first manipulated the price of Mango Markets’ native token, MNGO. The artificial inflation of the token’s price against stablecoin USDC allowed the exploiters to take “massive loans” that ended with approximately $110 million in different cryptocurrencies looted from the crypto platform.
Avraham Eisenberg Isn’t Sorry for Actions
Meanwhile, the Mango Market attacker does not seem remorseful for his action. In a recent podcast, Eisenberg argued that his team operated a highly profitable trading strategy, which he said did not break any rules.
Eisenberg noted that all our actions were legal open market actions, using the protocol as designed. He blamed the development team for not fully anticipating all the consequences of setting parameters as they are.
Additionally, when asked by Laura Shin on her Unchained podcast whether his actions were in line with the protocol’s intentions, Eisenberg reiterated this belief that he did not break the law. He explained that the intent behind any protocol is often unclear. For instance, statements in documentation typically do not reflect what’s actually in the code.
“Sometimes the code does what is intended, just what is intended isn’t what anyone wanted.”
Eisenberg said.
Furthermore, Eisenberg said that lending platforms are willing to lend at whatever a token’s current price is. This can also be determined by the parameters of the protocol, whether they use the spot price or an aggregate price, such as a time-weighted average price.
He argued that only when prices do not reflect the definition set by the protocol is it fair to say they are not in line with its intentions.
However, the US Department of Justice states that his exploit of Mango resulted in other investors losing their money. The DoJ also notes that his actions were deliberate market manipulation activities.
