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Judge Acquits Crypto Trader In Landmark Mango Markets Fraud Case

In a significant legal development, a U.S. judge has overturned the fraud convictions of Avraham Eisenberg, a crypto trader implicated in draining $110 million from Mango Markets.

U.S. District Judge Arun Subramanian determined that the prosecution failed to demonstrate that Eisenberg made false representations to the platform.

Eisenberg had allegedly manipulated the price of Mango's native token, MNGO, with substantial trades that led to a 1,000% price increase in just 20 minutes.

This manipulation allowed him to borrow and withdraw $110 million in cryptocurrencies based on inflated collateral.

Eisenberg's defense argued that he merely exploited a vulnerability in the permissionless structure of the smart contracts used by Mango Markets.

The judge concurred, stating there was "insufficient evidence of falsity" regarding Eisenberg's actions.

While Eisenberg's fraud case collapsed, he continues to serve a four-year sentence related to a separate charge involving the possession of child sexual abuse material.

His attorney expressed satisfaction with the judgment, noting that they believed from the start that the case was fundamentally flawed.

This ruling could have implications for how similar cases in the crypto space are prosecuted in the future.

As regulatory scrutiny increases in the industry, the definitions of fraud and manipulation continue to evolve alongside the technology.