Avraham “Avi” Eisenberg, the individual behind the $110 million exploit of the decentralized exchange Mango Markets, has been found guilty of fraud and market manipulation by a jury. The verdict was announced on April 18 in the United States District Court for the Southern District of New York, following extensive deliberations that took place after closing arguments on April 17.
Throughout the two-week trial, Eisenberg’s defense team argued that he had not committed any crimes, but rather executed a “successful and legal trading strategy” that resulted in approximately $110 million from Mango Markets. Eisenberg returned around $67 million of the funds after the exploit, but still retained over $40 million after a community governance vote. However, prosecutors contended that Eisenberg’s actions amounted to fraud.
The sentencing for Eisenberg, who now faces a potential prison term of up to 20 years, is yet to be determined by Judge Richard Berman. Eisenberg was arrested in Puerto Rico in December 2022 following his activities on Mango Markets and has been in U.S. custody since January 2023.
Following the conclusion of the criminal trial, it is anticipated that Eisenberg will also face civil enforcement actions from the U.S. Securities and Exchange Commission and the Commodity Futures Trading Commission in 2023. Both cases were put on hold and are expected to resume two weeks after the completion of the criminal proceedings.
In addition to Eisenberg’s case, there are several ongoing criminal cases involving prominent figures in the crypto industry that are being pursued by U.S. authorities. In March, former FTX CEO Sam Bankman-Fried was sentenced to 25 years in prison after being convicted on seven felony charges, although his legal team has filed an appeal notice. Former Binance CEO Changpeng Zhao, who pleaded guilty to one felony charge, is set to be sentenced on April 30.
According to Inner City Press and X Hall of Flame, it is expected that Alex Mashinsky, a less prominent figure in comparison, will receive a shorter prison sentence than Sam Bankman-Fried.