According to a press release from the US Securities and Exchange Commission (SEC) on January 20, it has charged Avraham Eisenberg with manipulating the “Governance Token” of Mango Markets to steal $116 million worth of cryptocurrency.

Mango Market Attacker Charged by the SEC

The Securities and Exchange Commission (SEC) of the United States charged Mango Markets attacker Avraham Eisenberg. He had already agreed to the scam, claiming that his activities on the Solana-based decentralized exchange (DEX) in October 2022 were fraudulent and instances of market manipulation.

US citizen Eisenberg was arrested in Puerto Rico in December and will be transferred to New York to answer to the multiple criminal and civil allegations filed against him. He is accused of manipulating the platform’s markets to steal around $116 million worth of crypto assets.

SEC’s filing claimed that Eisenberg violated several federal securities laws, including anti-fraud and anti-market manipulation rules. He also faced charges from the Commodity and Futures Trading Commission (CFTC) earlier this month and the US Department of Justice in December.

Moreover, SEC has filed a case in the federal district court in Manhattan asking for permanent injunctive relief, a conduct-based injunction, disgorgement with prejudgment interest, and civil penalties. However, it is unclear how much he will have to pay if found guilty.

According to the SEC, the MNGO token was also marketed and sold as a security. It also mentioned that there are still open investigations into other parties and securities offenses. It is unknown if Mango Markets or its owners are the subjects of an inquiry.

A Closer Look At How Attack Happened

According to the complaint, Eisenberg allegedly began a plot to steal digital assets worth approximately $116 million from the Mango Markets platform on October 11, 2022. Eisenberg, who committed the fraud while living in Puerto Rico, used two Mango Markets accounts: one to sell a large number of perpetual futures for MNGO tokens and the other to buy the same perpetual futures.
He then purchased massive amounts of the scarcely traded MNGO token in order to artificially inflate it
value in comparison to the cryptocurrency asset USD Coin. As a result of these purchases, the price of MNGO perpetual futures on Mango Markets increased.

He eventually succeeded in draining all available assets from the Mango Markets platform by borrowing and withdrawing approximately $116 million in various crypto assets.

Avraham Eisenberg’s Behavior Toward the Attack

MNGO was selling for less than 4 cents just before the hack. However, on October 11, he manipulated the token’s price, which temporarily rose to $0.91. After that, he borrowed $116 million in other crypto tokens against the inflated worth of his MNGO holdings.

He gave back around $67 million in return for a commitment from the Mango team not to file a lawsuit. However, he famously turned to Twitter to brag about his plan.

On October 15, Eisenberg boasted about the initial assault on Twitter, calling it a “highly profitable trading strategy.” He claimed that the plan, which he claimed he carried out with a group of users, briefly bankrupted Mango Markets. He also backed the scheme when he appeared on the Unchained Podcast.

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