In recent years, manipulation and hack attacks in the crypto sector have increased; for instance, Mango Markets was one of the networks exploited in 2022, leading to a loss of $117 million. After the hack, the network recovered $67 million from the attacker named Avraham Eisenberg.
In a recent development, Avraham Eisenberg seeks to keep the remaining funds. Per his attorneys, the exploiter has settled with Mango Markets and should keep his share of the money under dispute.
Avraham Eisenberg Vs. Mango Markets Situation
Mango Markets has been at the neck of Avraham Eisenberg with four different lawsuits on the exploit he carried out. The fourth lawsuit on January 25, 2023, was to demand $47 million in interest and damages. The decentralized finance (DeFi) protocol also asked the court to declare its former agreement with Eisenberg invalid and unenforceable.
The agreement between the DAO and Eisenberg was to allow him to keep $47 million and also stipulated that Mango Markets won’t pursue any criminal charges against him. But in the January lawsuit, Mango Market argued that the attacker got the agreement under duress.
The details suggest Mango Markets passed a governance proposal after the exploit, allowing Eisenberg to keep $47 million of the funds without further legal action. The lawyer representing Eisenberg, claims the exploiter returned $67 million to the network after the agreement. Some weeks later, Mango Markets reimbursed its eligible members. Afterward, the parties considered the matter closed.
But in the Mango Market lawsuit on January 25 to the US District Court for the Southern District of New York, the network stated that it agreed with the terms under duress. As per the management, there was no lawful bargaining as it only aimed to recover its users’ funds then.
Fast-forward to February 15, Eisenberg’s attorneys have filed against Mango Markets, objecting to the lawsuit of January 25. The attorneys argue that Avraham Eisenberg shouldn’t pay more to Mango Market since they already agreed and settled with the DAO.
The lawyers suggest Mango Markets aims to benefit from Avraham Eisenberg’s arrest for fraud in December by U.S. authorities in Puerto Rico. The charges by the FBI were commodities fraud and manipulation. Also, the U.S. Commodity Futures Trading Commission and the Securities and Exchange Commission have an ongoing lawsuit against Eisenberg for market manipulation and securities law violations, respectively.
DeFi Exploits In 2022
Statista shows 2022 saw the highest number of exploits, hacks, and manipulations in the entire crypto industry. But among all the sectors, the decentralized finance sector sufferer the most, losing billions of dollars to bad actors.
One of the highest losses of 2022 was Ronin Network, which lost more than $600 million to a hacker attack in March 2022. The second biggest hack was on Wormhole Bridge, which led to a loss of $325 million.
In October 2022, Mango Markets lost $117 million to Eisenberg’s manipulations. According to Chainalysis, by October 2022, the DeFi sector had lost up to $718 million to 11 different hacks in many protocols.
Featured image from Pexels and chart from TradingView.com
