By Bitcoinist - 1 year ago - Reading Time: 3 minutes
SEC And CFTC Legal Action Against Mango Markets Hacker Will Boost DeFi, Moody
The recent spree of regulatory actions in the DeFi ecosystem got positive reactions from the credit rating firm Moody. In a recent development, the Commodities Futures Trading Commission (CFTC) and the Securities Exchange Commission (SEC) took legal action against the Mango Markets exploiter for allegedly manipulating the market to steal funds from the platform.
The credit rating firm Moody came forward and commended the regulators’ actions, saying it would result in a safer atmosphere for the decentralized finance (DeFi) community.
Moody’s VP Believes DeFi is No Longer Unregulated
Cristiano Ventricelli, the VP of Moody’s Investors Service, wrote a note commending the SEC and CFTC for making the DeFi space “more transparent.” In detail, it stated that the enforcement actions against Avraham Eisenberg, the Mango Markets exploiter, signifies that DeFi is becoming a “safer environment.”
The Moody executive believes that both chief US regulators would likely carry out more actions against bad players in DeFi, gradually leading to a safer ecosystem.
In the earliest tweet, Cristiano Ventricelli made similar comments. He noted the regulator’s actions could improve control of the DeFi sector. According to a report, regulation in the DeFi space has proven difficult for regulators due to uncertainty regarding the authority to supervise open-source crypto protocols.
Moreover, the complexity of DeFi and crypto protocols has made it “almost impossible” for law enforcement agencies to understand how to oversee these sectors.
For instance, the SEC and the CFTC had previously disagreed over jurisdictional oversight of crypto assets. However, lately, the two regulators have been working to improve the industry’s supervision.
For example, on January 20 and 9, the US Securities and Exchange Commission and The CFTC filed charges against the Mango Markets exploit perpetrator, Eisenberg, for manipulating the Mango Markets.
In his recent tweet, Ventricelli suggested that a safer DeFi environment could attract more institutional investors like banks and retail investors.
Mango Markets Hacker Facing Multiple Lawsuits From SEC, CFTC, And Mango Labs
Regarding regulatory actions, in the lawsuit filing, the CFTC charged Eisenberg for orchestrating a manipulative scheme to falsely inflate Mango Markets’ swaps prices. Meanwhile, the SEC’s filing alleged that Eisenberg negatively impacted the Mango Market platform.
Mango Labs, the project behind Mango Markets, also filed a lawsuit against Eisenberg on January 25. The company demanded that Eisenberg compensates them with $47 million in damages, including interest for his activities on the platform in October 2022.
Last year, Mango Markets experienced an attack on its swaps offerings that left the platform with a loss of $116 million. The hacker previously returned $67 million of the stolen funds but kept $47 million. Mango Labs now demands the remaining $47 million plus interest over the damages.
According to reports, the Mango Markets DAO community gave a 98% vote, equivalent to 291 million tokens, in favor of the previous deal where the hacker gets to keep the balance of the stolen funds.
In addition, the community votes indicated that Mango Markets should drop charges against the hacker, but the company is going ahead with the lawsuit.
Featured image from Pixabay and chart from Tradingview.com
Original source: Bitcoinist