US SEC Charges Mango Market Attacker for Stealing $116M

Avraham Eisenberg also known as Mango Avi, the crypto trader behind the exploit on the Solana-based Decentralized Finance (DeFi) platform Mango Markets has been charged by the United States Securities and Exchange Commission (SEC). 

According to a press release, the SEC is charging Avraham for manipulating the Mango Markets’ Governance Token (MNGO token) which was offered and sold as a security, thereby draining the crypto trading platform of $116 million worth of crypto assets.

The manipulative hacker was also charged with violating anti-fraud and market manipulation provisions of the security laws. Currently, he is awaiting to appear before the Southern District of New York. 

However, the SEC is not bothered about the regulators involved in the case as it is willing and doing everything best possible to eliminate market manipulation.

How the Mango Markets Exploit Happened

In October last year, a hacker used an oracle price manipulation to steal funds from Mango Market platform’s treasury. Firstly, the attacker temporarily increased the value of the collateral and then drew out loans of about $116 million from Mango’s treasury. This was done by an economic design.

Going forward, Avraham admitted to having been responsible for the attack with a highly profitable trading strategy leading to the loss of over $110 million worth of cryptocurrencies. As such, he was arrested in Puerto Rico for his role in manipulating the exchange. Similarly, the 27-year-old U.S. citizen was charged by the Federal Bureau of Investigations (FBI) with commodities fraud and manipulation.

Meanwhile, early this month, the United States watchdog, Commodity Futures Trading Commission (CFTC) filed a civil action against Eisenberg in the U.S. District Court for the Southern District of New York for executing a fraudulent scheme.

Other DeFi Exploit in the Industry

The embrace of DeFi across various blockchain platforms has attracted lots of cybercriminals who seek tiny exploits to stripe users off their funds.

Although the rate of crypto exploits reduced overtime last year, early this year Mycelium, a multi-product Web 3.0 ecosystem had one of its liquidity pools exploited due to a price feed problem.

Equally, Ankr, a decentralized Web 3.0 infrastructure was exploited for about $5 million USD Coin by an attacker discovered to be its former employees.