Fears Dismissed: DOJ Confirms MNGO Not Classified as Commodity

  • Eisenberg and his team were behind the $100 million Mango Markets exploit.

On the Solana blockchain, Mango Markets is a decentralized trade platform. It enables customers to quickly and securely buy and sell a range of assets, including cryptocurrency. To enable users to trade with cheap costs and low latency, the platform makes use of Solana’s high-speed and low-cost transaction capabilities. Mango Markets is committed to offering a user-friendly and intuitive platform interface that makes it simple for both seasoned and novice traders to navigate and execute trades.

On December 26, Avraham Eisenberg was taken into custody in Puerto Rico on suspicion of manipulating and defrauding the market in commodities in connection with the $110 million fraud at the decentralized Mango Markets exchange. The exploiters then offered to return the majority of the money in the Mango governance forum.

Eisenberg claimed to be the driving force behind a “very profitable trading technique” and stated that he had only engaged in “legitimate open market actions, utilizing the protocol as designed.”

The news of Eisenberg’s arrest immediately went viral on cryptocurrency Twitter, with some observers focusing in particular on the fact that commodities fraud charges were being brought in a case involving a cryptocurrency coin:

“AVRAHAM EISENBERG, the defendant, willfully and knowingly, directly and indirectly, used and employed, and attempted to use and employ, in connection with a swap, a contract of sale of a commodity in interstate and foreign commerce.”

Eisenberg took out loans using his assets as security after manipulating the value of the MNGO coin on the exchange in relation to the USDC stablecoin. Eisenberg was accused of commodities fraud for this.

Due to Eisenberg’s withdrawals, other investors who had made deposits on Mango Markets lost all or the majority of their money. Others have also stolen $34 million from Harvest Finance in 2020, $182 million from Beanstalk in April, and $9 million from Moola Market in October using the same method that was used in manipulating prices at Mango Exchange..

Ex-FBI agent Chris Tarbell reportedly stated that the Mango Markets event was “more of a market manipulation” than a hack at the time, according to CoinDesk. According to the report, he also said that regulators would probably intervene even if the cryptocurrency industry didn’t want them to do so because the sector needed to “clean things up.”

Eisenberg is currently only being charged with the Mango Markets attack, but the crypto community suspects that the trader may have also been involved in similar operations on Curve, Fortress DAO, and Solend. There could be more charges filed soon.