The attack on crypto exchange Mango Markets is an example of what can happen when a trader uses loopholes in code to make money.
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“Code is law” is one of the more interesting phrases used by folks in crypto. Think of it this way, it is what is written into software that governs whether something like a transaction is valid, not the whims or caprices of an individual. Instead, what determines whether something is acceptable, permissible, or appropriate is what’s written into the software that enabled that transaction in the first place. It is another way of thinking about the so-called immutability of the blockchain.
Sounds logical, right? But what happens when the code doesn’t do what you were expecting it to do? Or what happens when someone exploits loopholes in the software’s logic for their own personal financial gain? These questions are at the crux of today’s episode, which will review an interesting precedent set by a crypto trader named Avraham Eisenberg, who exploited the idea of “code is law” to rake in millions of dollars by manipulating the price of tokens on exchange Mango Markets. Eisenberg was arrested and charged with fraud. Bloomberg reporter Muyao Shen and Bloomberg Law correspondent Matthew Bultman join this episode to discuss.
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This podcast is produced by the Bloomberg Crypto Podcast team: Supervising producer: Vicki Vergolina, Senior Producer: Janet Babin, Producers: Sharon Beriro and Muhammad Farouk, Associate Producers: Mo Andam and Ty Butler. Sound Design/Engineer: Desta Wondirad.
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