Avraham Eisenberg Sentenced to 52 Months for Child Abuse Material

Avraham Eisenberg, the individual responsible for the $100 million exploit of decentralized exchange Mango Markets in 2022, has been sentenced to 52 months in prison on charges related to child sexual abuse material. The sentencing took place on May 1 in the US District Court for the Southern District of New York. This case is entirely separate from his crypto-related crimes.

Eisenberg was found guilty of wire fraud, commodities fraud, and manipulation for the Mango Markets case in April 2024. However, his sentencing for the Mango Markets fraud remains pending. Eisenberg had previously claimed his actions were “legal open-market actions.”

The child abuse material case was filed in April 2024, following Eisenberg’s 2023 indictment for the Mango Markets fraud. While Eisenberg pleaded guilty to the child porn charge, his sentencing for the crypto fraud remains pending. Eisenberg was originally scheduled to be sentenced in July 2024 for the child abuse material charge. In May 2024, the judge had suggested that both sentencings would happen simultaneously in a consolidated proceeding, but this plan changed.

The Mango Markets incident occurred in October 2022 when Eisenberg manipulated price oracles to drain approximately $100 million in user funds from the decentralized exchange. Following the exploit, Mango Markets was forced to suspend deposits. Eisenberg publicly defended his actions, describing them as “legal open-market actions” rather than theft. He claimed to have negotiated a settlement to return user funds after the exchange’s insurance fund failed to cover the losses. Despite this claim, authorities viewed his actions as criminal.

In December 2022, US federal law enforcement arrested Eisenberg in Puerto Rico. FBI officials charged him with commodities fraud and commodities manipulation. A jury found Eisenberg guilty of wire fraud, commodities fraud, and commodities manipulation in April 2024. Throughout the proceedings, his defense team maintained that the exploit was not a cybercrime but rather a “successful and legal trading strategy.”

After his conviction, Eisenberg’s attorneys filed a motion for acquittal in September 2024. US prosecutors strongly opposed this motion, arguing that Eisenberg was correctly convicted based on a thorough evaluation of a “mountain of evidence.” The prosecution of Eisenberg represents the increasing risk of legal consequences for hackers and exploiters who target crypto platforms and users. Law enforcement agencies have shown greater capability and willingness to pursue these cases.

The dual criminal cases against Eisenberg highlight the serious nature of both his crypto-related offenses and the completely unrelated child abuse material charges. While the crypto community awaits the sentencing decision for the Mango Markets fraud case, the resolution of the child abuse material case marks a partial conclusion to Eisenberg’s legal troubles. The ongoing prosecution demonstrates that exploiters face not only potential technical barriers but also the risk of criminal charges and imprisonment for their actions.

Eisenberg’s case serves as a warning to others who might consider similar exploits of cryptocurrency platforms, showing that authorities are actively pursuing such cases. For Mango Markets users affected by the 2022 exploit, the criminal proceedings represent some measure of justice, though many lost substantial funds in the incident. The exact date for Eisenberg’s sentencing in the Mango Markets fraud case has not yet been announced.