DeFi is being tested in legal battles. Avi Eisenberg leveraged Mango Markets' code to extract $110 million, arguing that because the code permitted it, he didn't commit a crime. At the same time, the SEC's case against Uniswap Labs could determine how decentralized DeFi can be and whether the vision of a fully autonomous, code-based financial system is realizable.
Friday, April 12, 2024Avi Eisenberg, a crypto trader who manipulated Solana's Mango Markets in October 2022, was convicted of commodities fraud and manipulation by a U.S. federal jury. Eisenberg manipulated the DEX using collateral pumping to borrow $110 million from Mango without repaying it. His legal team argued that his actions were completely legal by the rules of the smart contracts, but the prosecution successfully asserted that he acted with fraudulent intentions.