What is Milei’s “libragate” controversy?
President Argentine’s X tweet Javier Milei resulted in a crypto controversy that threatened his political position. It all started when Milei endorsed the Libra token in X, describing it as a project dedicated to boosting economic growth by supporting small businesses and startups.
Given the 3.8 million followers of Milei and the credibility he brings as a president, the value of the token has sunk from close to zero to $ 5, reaching a $ 4-billion market capitalization.
However, the endorsement was identified on the public backlash, leading to Milei to delete the post after a few hours. It triggers a massive seller-off, which causes the Libra value to drop quickly and wipe millions of investor funds. Libra’s sudden rise and collapse Raised concerns with potential manipulation and the dangers of political figures that influence the chapter of crypto markets.
The Viva La Libertad Project, associated with Libra’s token, includes a popular catchphrase of Milei La Libertad (meaning “Long Live Freedom” in Spanish) in the domain name. The project’s stated purpose is to banen funds for the investors and citizens of Argentine in a decentralized manner. Its Token distribution The 50% tokens for the growth of Argentina, 30% for liquidity and 20% for treasury.
Team behind Libra token
Hayden Davis is a 28-year-old American crypto and CEO of Kelsier Ventures and has played an important role in launching controversial Memecoin Libra. He said he was a counselor to Milei, even though the office of the latter rejected any connection. Davis is said to have a role in Melania Trump’s memecoin launchMelania.
However, the KIP protocol denied their involvement in a statement released in February. 24 by the X handle it. The company said Mauricio Novelli invited it in Feb. 13, 2025, for support of small and midsize business funding but has nothing to do with the token creation.
Dave Portnoy, founder of Barstool Sports, said he was approached by a person connected to the launch of Libra Memecoin to discuss potential promotional opportunities. A crypto company led by an anonymous “Meow” is also involved in the launch.
Do you know? The Libra incident has drawn comparisons to the launch of the Trump coin, which is associated with US president Donald Trump. That adventure was also involved in a memecoin, which experienced a rapid rising price followed by a sharp decline.
Accusations against President Milei about the Libra Memecoin scam
Argentine president Javier Milei faces serious accusations following his cryptocurrency endorsement Libra. Critics have labeled the incident of a potential Rugpull scam.
Lawyer Jonathan Baldiviezo, next to Marcos Zealaya, engineer María Eva Koutsovitis and economist Claudio Lozano, former leader of Argentina’s central bank, Filad against President Milei, Filad Lawsuit against President Milei, The fraud accused him.
Baldiviezo claimed His actions helped with a “forbidden organization” along with coin advocates. The Non-Government Organization Observatorio Del Derecho a La Ciudad recited these concerns, which filed a lawsuit accused of playing a major role in a procedure that is said to have caused more than 40,000 investors to lose more than $ 4 billion.
Even Davis, one of the Libra’s developers, said Milei’s sudden removal of the token crash, indicating the betrayal of the President’s team.
Latin American leaders also expressed concern, along with Mexico President Claudia Sheinbaum, Says That is “it is extremely serious if it has been confirmed, especially about the authority of a president to promote a private.”
Reported, he was under investigation in Spain for his involvement in the Libra cryptocurrency scandal. The accusations include fraudulent operations, market manipulation and Trading of insider After Libra’s value collapsed, resulting in significant losses for investors.
How did Milei put his defense?
In response to the accusations, Milei and his office strongly rejected any wrongdoing. A statement from the President’s office emphasized that Milei was not involved in the development of Libra and that his social media posts only reflected his broader support for adventure entrepreneurs.
The statement noted that Milei regularly promotes business projects as part of its philosophical free market. His endorsement of the KIP protocol, the developers behind Libra, are part of a broader policy.
An unidentified government official defended Milei talks to Reuters, focusing that if anyone was deceived in this situation, it was the president himself. The official emphasized that Milei often supported private initiatives and would continue to do so. In a social media post, Milei removed the controversy as a political attack by his opponents.
Despite these defenses, the public’s doubt about Milei remains high. Critics argue that Milei’s enormous influence on social media should be responsible, especially about financial endorsements. The scandal has led to a broader debate about the ethical obligations of political figures in Pabagu -changing crypto space, with a lot of inquiry if Milei’s promotion is reckless or consciously.
Do you know? Faced with the criticism, Milei responded by accusing his political opponents, who did not think of the labeled “dirty rat of the political castle,” of an attempt to take advantage of the situation for their own malicious purposes.
Scandal investigation and possible repercussions
Falling from President Milei’s endorsement of Cryptocurrency Libra’s Cryptocurrency Call for his impeachment. Federal Judge María Servini led the investigation, evaluating whether Milei was engaged in fraudulent activities related to the sudden increase and crash of the token.
Notably, the project is under the US Department of Justice’s investigation for potential fraud and market manipulation. The investigation, led by the fraud section, could be expanded to involve agencies such as the Federal Bureau of Investigation, Securities and Exchange Commission and Department of Homeland Security.
While some opposition politicians called for an impeachment trial, such an outcome seemed unlikely. However, the controversy could damage Milei’s economic credentials, especially as Argentina approached the 2025 midterm election.
In addition to the judiciary, Milei’s administration established its own unit of investigation (UTI), consisting of representatives from financial, legal and anti-money organizations. The Anti-Corruption Office has also been active to assess the potential misconduct of government officials, including the President. UTI will examine the launch of Libra, focusing on individuals and creatures behind the project.
Do you know? This crypto scandal threatens Milei’s public injury, which he has cultivated as an economic-integrated economist who promises to control the widespread inflation of Argentina and political corruption.
Is Libra a rug pull?
Libra’s controversy reflects a classic rug pulling, where developers artificially enlarge the value of the token only Drain its liquidity.
Rug pulls usually Decentralized Finance (DEFI) Projects where pool pools play an important role. Scammers generally create a hype around the token using social media, influencers and sometimes poor endorsements. When many investors buy cryptocurrency and price skyrockets, developers sell their shares, making big income and leaving investors holding trivial tokens.
While Milei’s “libragate” scandal was suspected of pulling a rug, many high-profile rug pulls occurred in cryptocurrency. For example, for example, Hawk tuah (hawk) Create titles after the Rug Pull incident. Social media celebrity Haliey Welch launched on December 4, 2024, its value crashed from $ 500 million to $ 60 million in just 20 minutes. The incident caused a wide backlash from both the online community and legal authorities.
Similarly, Froggy (Froggy) has become one of the most ranging sizes of the rug of 2024. The playful bonds and promises of fast income attract a lot of investors. Developers fuel chaos on platforms such as X and Reddit, which presented it as a community-driven project with strong backing.
But once sufficient funds are gathered, they drain the liquidity, causing the token value to fall. Froggy (Froggy) eventually suffered a devastating 99.95% collapse from $ 0.00001577, its climax price.
