Home CryptocurrencyAltcoin SEC indicts Mango Markets exploiter for allegedly stealing $116 million in cryptocurrencies

SEC indicts Mango Markets exploiter for allegedly stealing $116 million in cryptocurrencies

by SuperiorInvest

The U.S. Securities and Exchange Commission has followed the Commodity Futures Trading Commission and others in filing parallel charges against a cryptocurrency user allegedly behind the multimillion-dollar exploitation of decentralized exchange Mango Markets.

In a Jan. 20 announcement, the SEC alleged Avraham Eisenberg rigged Mango Markets’ MNGO governance token, allowing him to steal roughly $116 million worth of cryptocurrency from the platform. According to the complaint, Eisenberg allegedly made a series of large purchases of MNGO to artificially inflate the price of the token relative to USD Coin (USDC), then drained assets from Mango Markets.

“Eisenberg engaged in a manipulative and fraudulent scheme to artificially inflate the price of the MNGO token, which was bought and sold as a crypto asset security, in order to borrow and then withdraw almost all available assets from Mango Markets, which left the platform in deficit when the security’s price has returned to pre-manipulation levels,” said David Hirsch, head of the SEC’s crypto-assets and cyber-assets division.

The SEC, assisted by the U.S. Attorney for the Southern District of New York, the FBI and the CFTC, charged Eisenberg with violating provisions of the securities laws against fraud and market manipulation. It will seek a “permanent injunction, conduct-based injunction, disgorgement with preliminary judgment and civil penalties,” according to the financial regulator.

Eisenberg was allegedly responsible for carrying out the main exploit of Mango Markets in October, the selection of roughly $50 million USDC, $27 million Marinade Staked SOL (mSOL), $24 million SOL, and $15 million MNGO. Mango Markets later announced that roughly $67 million worth of funds were returned with Eisenberg he publicly stated that he believed in his actions was legal as part of a “highly profitable business strategy”.

Source: Twitter

Authorities Eisenberg arrested in Puerto Rico in December. The FBI complaint said he “intentionally and knowingly” engaged in a scheme involving the “intentional and artificial manipulation” of the price of perpetual futures on the crypto platform. CFTC his own lawsuit followed on January 9 accused Eisenberg of market manipulation.

Related: How low liquidity led to Mango Markets losing over $116 million

After the judge’s detention hearing in January ordered the detention of Eisenberg until his trial, as it was the only way to secure his appearance. The Mango Markets exploiter has not posted on his Twitter account since his arrest in December.

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