Hacker Behind Mango Markets Exploit Gets Prison Time for CSAM Possession

Avraham “Avi” Eisenberg, the figure behind the infamous $110 million exploit of Mango Markets in 2022, has been sentenced to 52 months in federal prison—not for the crypto heist, but for a separate guilty plea to possessing child sexual abuse material (CSAM).

The sentencing took place on 1 May in the US District Court for the Southern District of New York, nearly a year after Eisenberg was indicted for fraud related to the Mango Markets incident and separately pleaded guilty to CSAM possession, which authorities discovered during his arrest.

Although a New York jury found Eisenberg guilty of wire fraud, commodities fraud, and market manipulation in 2023, sentencing for those charges remains unresolved.

The judge, Arun Subramanian, indicated he may still grant a defense motion for retrial or acquittal, citing possible venue issues and questions about the government’s classification of the MNGO Perpetual as a “swap.”

Defense attorneys also argued that Eisenberg’s actions lacked intent to deceive and were immaterial under the law.

While acknowledging Eisenberg’s efforts to understand the harm caused by his crimes, Judge Subramanian emphasized that a prison term was necessary, particularly as a deterrent against the proliferation of CSAM.

He underscored the severity of the offense by reading statements from three witnesses during the hearing.

Eisenberg will serve his sentence at FCI Otisville, a medium-security facility in New York, and will also undergo five years of probation after release.

His probation includes stringent conditions: monitoring software on all digital devices and mandatory participation in a drug treatment program.

Eisenberg’s Attorney Attempted to Lighten the Severity of His Client’s CSAM Possesion

In the lead-up to his trial last year, Eisenberg pleaded guilty to possessing more than 1,200 images and videos of CSAM, which federal agents discovered on his computer following his arrest in December 2022.

Although Eisenberg was not accused of producing or distributing the material, prosecutors argued that mere possession contributes to the continued exploitation of victims by sustaining demand.

A federal prosecutor said during sentencing that it “creates a market for these types of materials that otherwise wouldn’t exist.”

Eisenberg’s defense attorney, Sanford Talkin, pointed to his client’s upbringing in an ultra-Orthodox Jewish community in Rockland County, New York, as a source of psychological repression, emotional immaturity, and limited sexual awareness.

Talkin also suggested Eisenberg may have been a victim of abuse himself, referencing “at least two situations” involving “unthinkable” acts inflicted upon him during childhood.

In a letter to Judge Subramanian, Eisenberg acknowledged the moral weight of his actions, stating that even though he neither created nor shared the material, he now understands his role in perpetuating the harm done to the victims depicted.

Eisenberg’s legal team requested a three-year sentence for the CSAM charges, while federal prosecutors sought a combined sentence of six and a half to eight years for both the CSAM offense and his separate conviction in the $110 million Mango Markets crypto fraud.

Before handing down the sentence, Judge Subramanian noted mitigating factors, including Eisenberg’s autism diagnosis and significant psychological trauma.

However, he also emphasized the gravity of the offenses—especially given the presence of highly disturbing material involving victims under the age of two—and pointed out that the average federal sentence for CSAM possession is approximately four years.

Court Reviews Presentence Reports in Eisenberg Case

In their sentencing recommendation, prosecutors urged the court to impose a prison term of 6.5 to 8 years on Eisenberg, emphasizing the gravity of his conduct.

While Eisenberg continues to argue that his actions on Mango Markets were technically within the rules of the decentralised protocol, prosecutors rejected this defense, pointing to the jury’s verdict as clear evidence the argument fell flat.

They argued Eisenberg knew his actions were criminal, citing his own previous lawsuit accusing another trader of market manipulation—a move that, they claimed, showed he understood the legal boundaries.

After the Mango Markets exploit and his unmasking as the perpetrator, Eisenberg fled to Israel, further suggesting a deliberate attempt to evade accountability.

Potential Retrial on Crypto Theft Charges

Despite his sentencing for possession of CSAM, Eisenberg continues to fight his conviction in the $110 million Mango Markets fraud case.

His legal team argues that prosecutors failed to prove he acted with criminal intent, insisting he operated within the platform’s own rules and did not personally profit beyond controlling the market’s conditions.

They are now seeking either a full dismissal of the charges or a retrial.

Prosecutors, however, maintain that Eisenberg knowingly engaged in fraudulent behaviour and cite a previous lawsuit he filed against another individual for market manipulation as evidence he understood the legal boundaries he later crossed.

After being publicly identified as the Mango Markets exploiter, Eisenberg fled to Israel—an action the government sees as tacit acknowledgment of guilt.

The case is emblematic of a broader shift: authorities are increasingly pursuing cybercriminals in the crypto space, signalling that high-profile exploits may no longer go unpunished.