A federal prosecutor is pushing to freeze millions of dollars in assets linked to LIBRA. The Solana-based memecoin skyrocketed before crashing, leaving investors in shock. So, what’s going on?
President Javier Milei also got caught up in this LIBRA controversy. Let’s break it down.
The LIBRA Controversy
LIBRA introduced itself to the market with plans to help local small businesses and startup companies in Argentina. On February 14, the price of LIBRA increased until it acquired a market capitalization of $4.5 billion. Within twelve hours of its debut, the token lost 90% of its value, causing insider accusations of a rug-pull scheme.
Missed the $LIBRA madness while you were being a good Valentine? Here’s the recap:
1) Argentinian President tweets out a token
2) Token rockets to a $4.5bn valuation in 2 hours
3) Insiders pull out $87mn
4) Token crashes 90%
5) President deletes tweet, denies involvement
6)… pic.twitter.com/3Y4gNQKCRh— Stats (@punk9059) February 15, 2025
According to investigators, at least eight wallets linked to the LIBRA team cashed out $107 million before the crash. Since then, authorities have been investigating the case, suspecting financial manipulation.
The Prosecutor’s Crackdown
Eduardo Taiano, the federal prosecutor, froze $110 million in assets linked to LIBRA. The investigation will reconstruct lost social media content and focus on President Milei’s promotional posts during his campaign.
🚨 JUST IN: Argentina’s prosecutor Eduardo Taiano investigating President Javier Milei alleged involvement in “Libragate” has requested the freezing of as much as $110 million in crypto linked to the case. pic.twitter.com/RvCmnEsCPp
— Cointelegraph (@Cointelegraph) March 6, 2025
Taiano strengthened his evidence through the following:
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Requesting raw data on all LIBRA transactions from February 14–15 amid unusual market activity.
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Drafting international requests to get data from foreign crypto exchanges.
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Authorizing the freezing of digital wallets suspected of holding stolen funds.
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Tracking $4.5 million from LIBRA wallets, some used to buy POPE in a suspected laundering scheme.
How is Milei Involved?
Milei’s presidential endorsement of the LIBRA coin has triggered demands for his impeachment. Critics argue that deleting his posts didn’t erase his misleading messages to investors. President Milei assures investigators he did not endorse LIBRA but instead distributed mere information.
🇦🇷 JUST IN: Argentina’s President Milei denied promoting LIBRA and said, “I didn’t promote it, I shared it.”
He also said, “Those who got involved knew very well what they’re getting into – they’re volatility traders.” pic.twitter.com/I4M4jI462c
— Cointelegraph (@Cointelegraph) February 18, 2025
The LIBRA scandal led Reuters to report that Milei suffered a significant decline in political backing. Milei’s inability to build alliances reduced his backing ahead of Argentina’s upcoming congressional voting. Authorities are now analyzing phone records, visitor logs, and expert opinions to uncover the truth. Meanwhile, LIBRA’s price has collapsed to $0.10, leaving investors furious.
Conclusion
The value movement of LIBRA triggered an entire legal dispute between parties. Investigators under prosecutors have seized funds while scrutinizing senior officials from the scandal, which continues to expand. The outcome regarding justice delivery by officials and compensation returns for investors remains uncertain.
Disclaimer
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