Notorious cryptocurrency hacker who returned stolen money arrested

Hacker Abraham Eisenberg has been arrested in Puerto Rico for hacking the decentralized finance platform Mango Markets.

Mango Markets is a DeFi trading and credit platform based on the Solana blockchain. The exploit was carried out by manipulating the price of Mango Market’s native token, MNGO. Increasing the value of the collateral in MNGO allowed the hacker to borrow and withdraw funds from the protocol. The criminal used a scheme called the «oracle attack,» in which manipulating the price of the native MNGO token allowed the attacker to steal approximately $ 115 million worth of cryptocurrency. However, the hacker later agreed with Mango representatives to return $ 67 million. Eisenberg kept the rest of the money for himself.

The FBI’s statement of December 23 said that on October 11, Eisenberg used two accounts to simultaneously buy and sell futures based on the relative values of MNGO and the USD Coin (USDC) stablecoin. By being on both sides of the transaction, Eisenberg artificially inflated the price of MNGO relative to USDC, which allowed him to borrow and then withdraw more than $ 110 million in cryptocurrency.

By the way, Eisenberg took responsibility for the financial manipulation. However, the hacker does not see anything wrong with that.

The problem of hacking DeFi protocols and other cryptocurrency projects is not new. Companies often offer hackers a reward for finding bugs and vulnerabilities through the Bug Bounty system. However, only a few are so lucky — most cybercriminals end up in jail sooner or later. As a reminder, a hacker who stole more than $ 20 million in bitcoin in October will be imprisoned for 20 years. The hacker used ransomware to steal information from Windows-based systems and demanded payment in bitcoin from the victims. The victims of the fraudster were government agencies, law enforcement agencies and educational institutions, such as colleges, universities and schools.