- Bloomberg tweeted that crypto is not open to scammers and frauds, though it’s largely unregulated.
- The platform referred to the arrest of Avraham Eisengerg to corroborate its ideas.
- The US attorneys charged the man with commodities manipulation and fraud, after investigating the case in detail.
The latest tweet by the crypto analytic platform Bloomberg Markets showed that though crypto stays largely unregulated, it “offers no shield against alleged fraud”, referring to the arrest of the crypto trader, Avraham Eisenberg. The crypto trader is charged with fraud for stealing about $50 million worth of digital assets.
Earlier this week, the US Attorney’s Office in Manhattan, charged and arrested Eisenberg for exploiting the decentralized crypto exchange, Mango Markets.
According to the filing, Eisenberg has been charged with commodities fraud and commodities manipulation:
Eisenberg engaged in a scheme involving the intentional and artificial manipulation of the price of perpetual futures contracts on a cryptocurrency exchange called Mango Markets, and other manipulative and deceptive devices and contrivances.
Notably, on October 15, Eisenberg tweeted that he was involved with “a highly profitable trading strategy”:
Significantly, Eisenberg had been using social media platforms, especially Twitter, to convince his almost 4000 followers that he was highly putting efforts to implement better measures to control risks on DeFi platforms.
While probing into the case of fraud, the investigators concluded the strategies he used, including trade generation to inflate the crypto prices a crime, analyzing it as the manipulation in traditional markets.
Neal Kumar, the partner at Willkie Farr & Gallagher LLP said in an interview that the term “unregulated” is not a license to “do any activity you want:
There’s a difference between what’s regulated and what’s legal. Just because it’s not regulated doesn’t mean that you could do any activity you want. Government can still pursue fraud and manipulation.
According to Bloomberg, the efforts that the attorneys have put into investigating the case is a piece of significant evidence to show how crypto isn’t an open space for scammers and frauds.
As per the case statement, the accused has manipulated the price of perpetual contracts for Mango Market’s native token MNGO. In addition, he has also sold huge amounts of the token to himself, thus pumping the price by 1,300% in a short while.
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