New York Jury Convicts Avraham Eisenberg in $110 Million Crypto Market Manipulation Case
A federal jury has convicted crypto trader Avraham Eisenberg of fraud and market manipulation.
The charges stemmed from Eisenbergs exploitation of Mango Markets, a decentralized finance (DeFi) protocol built on the Solana blockchain.
Eisenberg Convicted for Market Manipulation
Eisenberg, 28, was found guilty by jurors in a federal court in Manhattan on charges of commodities fraud, commodities manipulation, and wire fraud.
Avraham Eisenberg executed a manipulative trading scheme on a cryptocurrency exchange, defrauding the exchange and its investors out of $110 million, stated Nicole M. Argentieri, head of the Justice Departments Criminal Division.
This marks the U.S. Department of Justices first criminal case targeting cryptocurrency market manipulation.
Mango Markets is a decentralized platform managed by Mango DAO that facilitates the lending, borrowing, swapping, and leveraged trading of cryptocurrencies.
During the trial, prosecutors presented evidence that Eisenberg engaged in a manipulative trading strategy on October 11, 2022.
Eisenberg reportedly used two accounts to execute simultaneous buy and sell orders for futures contracts tied to the value of Mangos native token, MNGO, and the stablecoin USD Coin. These manipulative trades inflated the value of his contracts by 1,300% in just 20 minutes.
As a result, Eisenberg managed to borrow against his artificially inflated holdings and withdrew approximately $110 million worth of various cryptocurrencies.
Despite Eisenbergs claims that his trades were lawful and transparent, the jurys deliberations concluded in less than a day. Expressing disappointment, Eisenbergs attorney, Brian Klein, announced plans to pursue post-trial motions to advocate for his client.
Eisenberg has since agreed to give back $67 million on the condition that other token holders refrained from pursuing legal action against him or freezing his assets.
Eisenberg in Custody Awaiting Sentencing
Following his arrest on December 26, 2022, in San Juan, Puerto Rico, where he resided, Eisenberg has remained in custody after prosecutors argued that he posed a flight risk.
Executive Assistant Director Timothy Langan of the FBIs Criminal, Cyber, Response, and Services Branch commented on the case: If you engage in fraudulent activity, whether that be in the cryptocurrency space or through other forms of market manipulation, you will be held accountable for your ill-gotten gains.
He also emphasized the agencys commitment to holding individuals accountable for such fraudulent activities.
Eisenbergs sentencing is scheduled for July 29, with potential penalties including a maximum of 10 years in prison for commodities fraud and manipulation and up to 20 years for wire fraud.
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Text source: CryptoPotato
