Accusation of commodity manipulation: Mango market. The Department of Justice announced the arrest of Avraham Eisenberg on Tuesday, charging him with “market fraud” related to his attack on crypto exchange Mango Markets.
A second filing by Assistant US Attorney Thomas S. Burnett and Noah Solowiejczyk sued Eisenberg on charges of falsification of goods and fraud.
“Eisenberg engaged in a scheme that involved the deliberate and fraudulent manipulation of the price of a fixed-term futures contract on a cryptocurrency exchange called the Mango market,” the filing says. Mango Market is a Decentralized Exchange (DEX) based in Solana and controlled by a DAO with its token holders, MNGO, which allows investors to borrow, lend, trade and exchange cryptos with leverage.
On October 11, 2022, the project reached a value of about $110 million, and Mango’s tweeting market at the time the entrepreneur had used the platform’s price tag. Eisenberg also admitted that he was “involved in a group that implemented a viable business plan” soon after.
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As explained in the court filing, Eisenberg carried out the attack by selling MNGO perpetuals from one account to another account that was also under his control. He began to buy large amounts of MNGO, which had the effect of increasing the value of his large permanent assets of MNGO. He borrowed money against those assets and released $110 million in various cryptocurrencies. This plan has a dramatic effect that makes the platform unstable, with Eisenberg himself explaining that the insurance money there is not enough to cover everything.
On October 14, 2022, Mango DAO fined Mango customers $47 million and promised not to press charges if it returned up to $67 million.
“We want to make sure the staff is full wherever possible,” DAO said.
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