U.S. Judge Overturns Fraud Convictions in Mango Markets Exploit Case
In a major twist to one of the crypto industry’s most watched legal battles, a U.S. judge has vacated two fraud convictions and acquitted a third charge against Avraham Eisenberg, the trader behind the 2022 Mango Markets exploit.
Judge Arun Subramanian, presiding in the Southern District of New York, ruled that prosecutors lacked proper venue to try Eisenberg in New York. According to the ruling, Eisenberg did not make trades from New York, communicate with anyone in the state, or interact with Mango Markets in a way that linked him to the jurisdiction.
“There is no allegation that the Mango Markets platform had ties to New York,” Judge Subramanian stated.
Prosecutors argued that Eisenberg exploited a DeFi oracle to inflate the value of his collateral, enabling him to drain around $110 million from the Mango Markets protocol. However, Subramanian agreed with the defense that Eisenberg was acting from Puerto Rico, and that the venue arguments put forth — such as a user from New York attempting a withdrawal — were insufficient.
Significantly, Judge Subramanian also acquitted Eisenberg of a wire fraud charge, noting that the behavior in question, while manipulative, did not violate existing wire fraud laws. He highlighted that Mango Markets lacked clear rules or prohibitions about borrowing, weakening the government’s argument that Eisenberg misrepresented his intentions.
“On a platform with no rules… the government needed more to show that Eisenberg made an implicit misrepresentation,” the ruling noted.
The Department of Justice must now decide whether to refile charges in a different venue. For now, Eisenberg’s partial legal victory underscores a complex legal landscape for decentralized finance — one where questions of jurisdiction and regulation remain unresolved.
Kosta Gushterov
Reporter at Coindoo
Kosta has been a part of the team since 2021 and has solidified his position with a thirst for knowledge, incredible dedication to his work and a “detective-like” mindset. He not only covers a wide range of trending topics, he also creates reviews, PR articles and educational content. His work has also been referenced by other news outlets.
