It doesn’t sound like it was very difficult to scam people out of $110 million. The crypto exchange was set up so badly that it was child’s play for this crook (now convicted):
Fraudster charged with crypto market manipulation defended Mango Markets scheme.
arstechnica.com
Anybody still want to invest in crypto? 🤦♂️
Hard pass. Interesting how it doesn't take long for crooks to start hammering on every "innovative product" the finance sector synthesizes from practically thin air to begin with, as long as gullible buyers (many of them invariably coming late to the plate) also figure they can make a fast buck off whatever it is.
Market manipulation efforts aren't uncommon, but with this guy, all that frenetic activity in a pretty thin market plus bragging on it via social media while exercising his tactics were big red flags, ones that even our ill-paid government regulators could hardly miss.
So yeah, uncovering fraud committed in MNGO at that level of stupidity should not make investors in other cryptocurrency feel complacent.
How all that sausage gets made is one thing, who minds the larders is another, who are the real or alleged investors/customers something else. And how much educated brilliance a rich crook can buy to successfully rig a crypto market is probably something we'll get a belated glimpse of now and then down the road. It's all going to be chasing after stuff that already left the barn, with most of it not in there for long anyway.
Ever open a petty cash box to find not even an IOU in there? Ever open the fridge and find the leftover chicken cacciatore disappeared? At least with those situations, you had a clue "who dunnit" even if knowing that will not resupply the gone objects. With crypto.... there's a high level of trust needed to believe that the petty cash box or the fridge is actually really ever stocked with something worth having.
And where is all that stuff the crypto market maniuplators make off with? Somewhere along the way it has to turn into something both more tangible and more fungible, like cash. But it's getting trickier to process much illicitly obtained cash through banks these days. So... yeah, cash mules. WSJ just ran a piece today about cheaply bought transshipment of huge piles of cash from Heathrow to Dubai, taking advantage of the fact that Heathrow could but apparently has not or had not been scanning for cash in outgoing baggage destined for the cargo bays. They've been oriented to looking for bombs, not tax sheltered biz hauls or laundred drug money or plain heist bonanzas or just run of the mill halawa cash transfers. Dubai apparently hasn't minded if you arrived with truckloads of dough so long as you declared it. Yeah, it has been fine to say "Oh and I've got 2.8 million dollars in cash in my luggage." You know. Like for shopping while on vacay.
Billions in Dirty Money Flies Under the Radar at World’s Busiest Airports (paywall lifted)
That the crooks have apparently been stupid enough to make the return trips from these cash-toting jobs with a big pile of empty bags (!!) hadn't seemed to strike either baggage handlers or customs officials at Heathrow as an anomaly. This could all be changing now since the bust of a cash smuggling ring and the laying bare of such tactics a couple of years ago.
Still one wonders how thieves change any ill-gotten assets in crypto form into something less seemingly ephemeral yet still portable -- cash, gold, rare minerals?-- as a first step in ending up with a "legitimate" asset like real estate, or at least the ability to trade a fat pile of cash to someone anonymously, for a favor or some action that can't be acquired acceptably via a public transaction. Wouldn't it take a lot of trust to persuade someone to part with a big pile of cash for a supposedly equal amount of wealth in the form of crypto? Doesn't that get harder over time as more scams come to light?
www.nytimes.com
web3isgoinggreat.com
