The crypto community on Twitter is celebrating the state protecting traders by filing charges against the Mango Markets hacker. Bloomberg writer and podcast show host Joe Weisenthal tweeted that he found it interesting “to see crypto people cheering charges being brought against the alleged manipulator of Mango Markets.”
It’s interesting to see crypto people cheering charges being brought against the alleged manipulator of Mango Markets.
Happy that the state is protecting traders of DeFi exchanges after the coders of those exchanges failed to protect against bad actors.
— Joe Weisenthal (@TheStalwart) January 10, 2023
He commends the state for protecting crypto traders on DeFi exchanges while the platform’s coders failed to ensure users’ safety.
On January 9, the Commodity Futures Trading Commission (CFTC) issued charges against Avraham Eisenberg for manipulation of the Solana trading exchange Mango Markets and stealing more than $110 million worth of digital assets.
The CFTC added in the filing,
The goal of Defendant’s scheme was straightforward: to artificially inflate the value of his swap contract holdings on Mango Markets through price manipulation so that he could ‘borrow’ a significant amount of digital assets that he had no intention to repay.
On October 11, Mango Markets tweeted that a hacker manipulated the exchange’s price Oracle, draining nearly $110 million. In December, Eisenberg was arrested by the US Department of Justice due to his participation in the fraud, followed by a tweet where he confessed he was involved in a “highly profitable trading strategy.”
According to the charges filed, Eisenberg used two anonymous Mango Markets accounts to establish a $19 million long position consisting of over 400 million MNGO/USDC Swaps at approximately $0.04 via the first account. In the later account, he established a $19 million short position consisting of the same number of MNGO/USDC Swaps, resulting in a wash transaction.
Eisenberg is currently being charged with fraud, market manipulation, and violating the Commodity Exchange Act. However, the agency will not stop there and continues to seek monetary penalties, a ban on trading digital asset commodities, and restitution of funds.