- Judge vacated Eisenberg’s fraud convictions in a major legal decision.
- Ruling affects how DeFi exploits may be legally treated.
- Regulators face dilemmas with decentralized protocol vulnerabilities.
Main Content:
U.S. District Judge Arun Subramanian overturned all fraud convictions against Avraham Eisenberg related to the Mango Markets exploit on May 23, 2025, in New York.
The ruling indicates a pivotal shift in how decentralized finance (DeFi) exploits might be interpreted legally, as conventional fraud concepts face challenges.
In October 2022, Avraham Eisenberg, a self-proclaimed applied game theorist, executed what he called a market strategy on Mango Markets, leading to convictions that were vacated this month. Eisenberg allegedly manipulated MNGO Perpetuals, facilitating loans exceeding $100 million, amplifying the vulnerabilities of DeFi protocols.
Judge Subramanian concluded that Mango Markets’ system, being permissionless and automatic, could not be deceived legally, necessitating fresh considerations for DeFi regulations. The prosecutor argued exploitation akin to market manipulation, while Eisenberg’s defense emphasized using flawed yet available systems.
“Mango Markets was permissionless and automatic; the system couldn’t be deceived in a legal sense,” said Judge Arun Subramanian, U.S. District Judge, U.S. District Court for the Southern District of New York.
Eisenberg returned $67 million through a settlement, which reflects financial consensus amid regulatory uncertainties. This case influences how decentralized exchanges are viewed, especially given the inherent reliance on predetermined code rather than centralized oversight. Historically significant, Judge Subramanian’s decision underscores emerging challenges in bridging DeFi mechanics with existing legal frameworks.
About the author
Newly Created Wallet Withdraws 350 BTC from Binance
Newly created wallet withdraws 350 BTC (worth $37.84 million) from Binance in two days, raising market interest.
Trump Tariff Announcement Sparks Crypto Market Turmoil
Trump's tariff announcement on the EU causes a crypto market shake, $300 million liquidated.
Wynn Predicts Bitcoin Surge to $121,000 Next Week
Crypto trader James Wynn forecasts Bitcoin's rise to $118,000-$121,000, impacting market volatility with his $1.23B long bet.
UK Crypto Regulations Demand Rigorous User Data Reporting
HM Revenue and Customs (HMRC) of the UK announced stringent user data reporting requirements for crypto exchanges, effective from January 1, 2026, to enhance transparency and combat fraud.
YGG Token Now Integrated on Abstract Blockchain
Explore Yield Guild Games' launch of the YGG token on Abstract Blockchain as they seek to expand in the Web3 gaming sector.
2025 Outlook: Crypto Staking’s Opportunities and Challenges
Staking in the cryptocurrency world has undergone significant changes by 2025, shifting from a simple passive income strategy to a complex process requiring strategic decisions by investors globally.
Related
Newly Created Wallet Withdraws 350 BTC from Binance
Newly created wallet withdraws 350 BTC (worth $37.84 million) from Binance in two days, raising market interest.
Trump Tariff Announcement Sparks Crypto Market Turmoil
Trump's tariff announcement on the EU causes a crypto market shake, $300 million liquidated.
Wynn Predicts Bitcoin Surge to $121,000 Next Week
Crypto trader James Wynn forecasts Bitcoin's rise to $118,000-$121,000, impacting market volatility with his $1.23B long bet.
UK Crypto Regulations Demand Rigorous User Data Reporting
HM Revenue and Customs (HMRC) of the UK announced stringent user data reporting requirements for crypto exchanges, effective from January 1, 2026, to enhance transparency and combat fraud.
YGG Token Now Integrated on Abstract Blockchain
Explore Yield Guild Games' launch of the YGG token on Abstract Blockchain as they seek to expand in the Web3 gaming sector.
2025 Outlook: Crypto Staking’s Opportunities and Challenges
Staking in the cryptocurrency world has undergone significant changes by 2025, shifting from a simple passive income strategy to a complex process requiring strategic decisions by investors globally.
Be the first to leave a comment