Avraham Eisenberg allegedly used separate accounts that he established on the exchange to sell and then purchase large volumes of MNGO, the exchange’s crypto token. The transactions had the effect of artificially inflating the price of MNGO relative to USDC, a crypto stablecoin pegged to the US Dollar. The price of MNGO rose by approximately 1300% as a result of the trades. 

This artificial rise led to a significant increase in value and also in the “borrowing power” of one of the accounts purportedly controlled by Eisenberg. The exchange’s own systems, which permit an account holder to borrow and also withdraw cryptocurrency, were then used. This leveraging increased borrowing power, enabling Eisenberg to borrow and withdraw $110m worth of different cryptocurrencies.

These transactions effectively drained the exchange of all of its funds. Within a startlingly swift 20 minutes, the exchange had in effect become insolvent. Eisenberg travelled to Israel a day later.

According to the charges, Eisenberg was fully aware that he was breaking the law, something that the subsequent negotiations with the exchange seem to bear out. Following these negotiations, $67m was repaid to the exchange in return for a promise not to pursue civil or criminal claims.

Eisenberg was arrested in Puerto Rico on 26 December.