What Does Mango Markets Exploiter Avi Eisenberg's Arrest in Puerto Rico Mean for DeFi? - Ep. 441

Gabriel Shapiro, general counsel at Delphi Labs, and Collins Belton, managing partner at Brookwood P.C., dive into the controversial case of Avi Eisenberg, the self-described “applied game theorist” who was arrested in Puerto Rico on Dec. 26 on market manipulation and fraud charges. The two crypto lawyers discuss the case’s potential impact on DeFi and DAO governance — and whether “code is law” stands a chance in the courtroom.

Show highlights:

whether Avi’s manipulation of the markets constitutes fraud

debating the crypto maxim “code is law”

whether it’s wrong to use DeFi code in a “smarter way”

how the Mango Markets exploit happened due to poor governance management

whether crypto should be regulated from the securities angle or the commodities angle

the consequences of Avi’s arrest for the DeFi space

whether MEV could constitute market manipulation, even if it’s democratized for everybody

the role of DAOs and whether early-stage projects should maintain some level of centralization

how DAOs could be designed to have better mechanisms in order to deal with potential issues

whether members of the Mango Markets DAO are liable because of their role in designing the system

how Avi was “naive” to think he could avoid legal liability by returning the funds

why Gabe thinks credit protocols are socially positive and why he hopes that prosecutors won’t “throw everyone in jail”

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Links

Guests:
Gabriel:

Twitter

Delphi Labs

Gabriel’s Twitter thread on the case

Previous appearances on Unchained:

The SEC's Lawsuit Against Ripple and 2 Execs: What You Need to Know

Collins:

Twitter

LinkedIn

Previous appearances on Unchained:

How the Greatest Decentralizing Force for Crypto Projects Is the SEC

Episode Links:
Previous coverage of Unchained on Avi Eisenberg and the Mango Markets exploit:

The Mango Markets Attacker on Whether His 'Trade' Was Ethical or Not - Ep. 413

The Chopping Block: 'Code Is Law' Is 'Obviously Not How Anything Works Ever'

The Chopping Block: SBF Wants to Win in the Court of Public Opinion. Will He? - Ep. 428

Mango Markets exploit

Explanation

Avi’s “Highly profitable trading strategy” Twitter thread

Unchained:

Mango Markets Exploiter Arrested on Market Manipulation Charges

Mango Markets Exploiter Gets Liquidated But Leaves Aave With ‘Excess Debt’

Mango Markets $42M Reimbursement Proposal Passes

Mango Markets Exploiter Returns $67M After Revealing His Identity

Mango Markets Hacker Proposes Keeping $70M ‘Bad Debt’ As Bounty

Solana’s Mango Markets Sees $100M Drained in DeFi Exploit

Chaindebrief: How Manipulation On AAVE And CURVE Went Wrong, Attacker Got Rekted Instead

The Defiant: Another Fork Bites the Dust: The Looming Fall of Fortress DAO and the Perils of Off-Chain Governance

Karlstack: EXCLUSIVE: The Man Who May Have Milked $100+ Million from Mango Markets

CoinDesk:

The Impact of Avraham Eisenberg’s Case on the Future of Crypto

Mango Markets Exploiter Eisenberg Arrested in Puerto Rico

Mango Exploiter's Funds Get Liquidated After Roiling Aave Using $20M of Borrowed Curve Tokens

Complaint

CNBC: Decoding The Avraham Eisenberg Arrest And Its Impact On Crypto Bug Bounties, White Hat Hackers

Decrypt: Mango Markets Attacker Avraham Eisenberg Arrested, Charged With 'Market-Manipulation Offenses'

Protos: Who is Avraham Eisenberg and why is he all over Crypto Twitter?

Crypto Briefing: Curve Whipsaws 75% as DeFi Degens Squeeze Avraham Eisenberg

New Filing: CFTC charges Avi Eisenberg

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