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Mango Markets Exploiter Refuses to Return Bug Bounty Paid as Disputed Funds

DeFi protocol Mango Markets

Avraham Eisenberg, the alleged exploiter of the decentralized finance protocol Mango Markets, is seeking to retain his share of cryptocurrency gained from his so-called “highly profitable trading strategy.”

On February 15, Eisenberg’s attorneys filed a motion in a New York District Court objecting to a lawsuit from Mango that seeks $47 million in damages plus interest, starting from the time of Eisenberg’s October attack, which drained around $117 million from the protocol.

Eisenberg’s attorneys argued that their client shouldn’t have to pay back any more funds to the DeFi platform, as a settlement agreement had been reached with Mango DAO, and the “matter was settled.”

Following the draining of its treasury, a governance proposal was passed by the Mango DAO that allowed Eisenberg to keep $47 million of the pilfered funds as a bug bounty.

This was in exchange for Mango not pursuing legal action. The attorneys noted that Eisenberg transferred around $67 million to Mango Markets, and eligible members received reimbursement from the Mango Markets treasury, at which point, everyone considered the matter to be closed.

However, Mango has contested the settlement, alleging that it was made “under duress” and that Eisenberg “was not engaged in lawful bargaining.”

Eisenberg’s attorneys refuted these claims and stated that the “improper three-month delay” in filing the suit “undermines any alleged irreparable harm.”

They further claimed that the lawsuit aims to “take advantage” of Eisenberg’s December arrest in Puerto Rico by United States authorities.

Eisenberg is facing several other legal challenges, including charges of commodities fraud and manipulation by the Federal Bureau of Investigation, a lawsuit from the U.S. Commodity Futures Trading Commission for alleged market manipulation, and a suit from the Securities and Exchange Commission for violating securities laws relating to anti-fraud and market manipulation.

Despite the ongoing legal battles, Eisenberg’s attorneys are seeking to retain his share of cryptocurrency gained from Mango Markets, arguing that the matter was already settled and that their client should not have to pay back any more funds.


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