Crypto trader Avraham “Avi” Eisenberg was found guilty by a Manhattan jury in October 2022 of orchestrating a $110 million fraud scheme targeting the decentralized finance (DeFi) protocol, Mango Markets. 

According to prosecutors, Eisenberg, operating under a false identity, allegedly engaged in market manipulation to drive up the price of Mango’s token, MNGO, and related contracts, ultimately exploiting an exchange feature to withdraw $110 million in cryptocurrency with no intention of repayment.

During the trial, prosecutors revealed that Eisenberg manipulated the price of MNGO tokens to deceive the system and acquire illicit funds. By “artificially inflating” the token’s value, Eisenberg allegedly sought to perpetrate a deliberate fraud against Mango Markets. 

Assistant US Attorney Thomas Burnett emphasized Eisenberg’s intent to “take the money and run,” alleging that he meticulously planned and executed the fraud.

Shortly after his significant financial gain, Eisenberg fled to Israel from Puerto Rico, where he resided. However, upon his return to Puerto Rico on December 26, 2022, US authorities arrested him. Eisenberg has remained in custody since then, as a judge deemed him a flight risk ahead of his trial.

During the trial, Eisenberg’s defense attorney, Brian Klein, argued that his client had executed a legal trading strategy within the exchange’s rules. 

Klein contended that Eisenberg had taken calculated risks within the confines of the smart contracts governing the decentralized finance platform. Furthermore, he highlighted the platform’s disclaimer that warned users of the software’s unaudited nature and associated risks.

Assistant US Attorney Thomas Burnett countered the defense’s argument, stating that the rules of the Mango Markets platform did not shield Eisenberg from prosecution for fraud and manipulation. 

Eisenberg did not testify during the trial, but he played an active role in his defense, taking notes throughout the testimony and frequently suggesting questions for his attorneys to ask the witnesses. 

Following Eisenberg’s conviction, the price of the MNGO token has experienced a notable surge, reaching $0.029. This represents a notable 11.5% increase within the past 24 hours alone.

In broader timeframes, contrasting the performance of the overall cryptocurrency market, MNGO has demonstrated significant gains of 69% and 46% over the past fourteen and thirty days, respectively. These figures indicate a renewed interest in the token after the exploit of the Mango Markets protocol.

However, despite these recent gains, the MNGO token remains significantly below its all-time high of $0.49, achieved in September 2021. The current price reflects a decline of 94% from that peak level.

Featured image from Shutterstock, chart from TradingView.com

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