A federal jury has convicted crypto trader Avraham Eisenberg of fraud and market manipulation.

The charges stemmed from Eisenberg’s 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 Department’s Criminal Division.

This marks the U.S. Department of Justice’s 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 Mango’s 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 Eisenberg’s claims that his trades were lawful and transparent, the jury’s deliberations concluded in less than a day. Expressing disappointment, Eisenberg’s 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