In the recent news, Mango Markets, a decentralized crypto platform based on Solana, experienced an exploit. According to a source, the attack led to a loss of $114 million worth of crypto tokens.
Exploits in the crypto industry are increasingly becoming more rampant on different platforms. The attackers are using innovative approaches to manipulate vulnerabilities in the targeted protocols. Over the years, millions of dollars have been lost through system exploits and attacks.
The exploiter, Avraham Eisenberg, confirmed his involvement in the recent attack on Mango Markets. According to his Sunday statement, he operates with a team that engages in a ‘highly profitable trading strategy. Eisenberg, who described himself as a digital art dealer, refused to reveal the size of his team.
Exploiter Said His Actions Were Legal
The attacker said that their activities were legal open market actions since they used the platform in line with its design. However, in his opinion, the developers of Mango Markets underestimated the repercussions of setting the platform parameters the way they did.
Also, Eisenberg observed that the exploit on the platform led to the insolvency of Mango Markets. He mentioned the insufficiency of the insurance fund to undertake all liquidations on the forum. Hence, it lost over $100 million in its users’ funds.
The attacker related the situation to the functioning of auto deleveraging on exchanges. This risk management process is employed once negative equity is closed. This requires calling back some gains from profitable traders to protect users’ funds.
Subsequently, Eisenberg reported that he wanted to salvage the situation by negotiating a settlement agreement to return $67 million. According to him, he aims to recapitalize the exchange and make all users whole.
Details Of Eisenberg’s Exploit On Mango Markets
The exploit was through a legal trading strategy on the DeFi platform. The first action Eisenberg took was to fund the platform with $10 million. Then, he manipulated the oracle to inflate the Mango token price three times from $0.30 to $0.91.
The price inflation boosted Eisenberg and his team’s collateral, enabling them to borrow more funds from the platform and drain the $114 million.
According to the vote of the Mango community, Eisenberg is to retain $47 million and return $67 million to the protocol. Also, the DAO decided that the returned funds would be channeled to the recapitalization of the exchange. This will help the system to cater to the bad debt from the exploit.
A source noted that besides the Mango Markets exploit, Eisenberg has been part of other such attacks. For example, the exploiter was accused of defrauding FortressDAO investors at the beginning of the year. The attack amounted to about $14 million.
Ethereum price hovers around $1,300 on the chart l ETHUSDT on Tradingview.com
Featured image from Pixabay and chart from TradingView.com
Go to Source
GIPHY App Key not set. Please check settings