Argentina’s President Javier Milei is facing fraud charges over his involvement in promoting the LIBRA cryptocurrency, which skyrocketed to a $4 billion market cap before crashing by 96% within hours. The charges, filed on Sunday in an Argentine criminal court, were led by Claudio Lozano, former head of the Argentine Central Bank, alongside other attorneys and political opponents.
The complaint claims that Kelsier Ventures, the company behind LIBRA, and its CEO Hayden Davis, engaged in fraudulent activities with Milei’s alleged participation.
LIBRA Token: From Skyrocketing to Crash in Hours
On Friday, Milei promoted LIBRA on his X (formerly Twitter) account, directing users to the Viva La Libertad Project website. His post described LIBRA as a private initiative supporting Argentina’s small businesses. The crypto community reacted instantly, drawing comparisons to Donald Trump’s December meme coin launch.
However, concerns arose when crypto analytics firms like Bubblemaps and Chainalysis flagged the project for high-risk indicators. Bubblemaps reported that 82% of LIBRA’s total supply was concentrated in a single cluster of wallets, suggesting control by a small group of individuals.
As skepticism grew, traders rushed to sell their holdings, leading to an 89% price crash. Reports claim that the LIBRA team “cashed out” $87 million in USDC and SOL from liquidity pools, further accelerating the collapse.
Milei Deletes Post and Distances Himself from LIBRA
Following the fallout, Milei deleted his original post and issued a public statement distancing himself from the project.
“A few hours ago, I posted a tweet, as I have countless times before, supporting an alleged private venture with which I obviously have no connection,” he stated.
“I wasn’t informed of the project’s details, and after learning about them I decided not to continue promoting it (that’s why I deleted the tweet).”
Despite Milei’s attempt to disassociate from LIBRA, legal experts argue that his endorsement played a crucial role in the project’s rapid rise and subsequent crash.
Legal Battle Ahead for Milei
The fraud charges filed against Milei accuse him of being an essential part of the scheme. According to lawyer Jonatan Baldiviezo, the case involves an “illicit association” and “an indeterminate number of frauds”.
The Argentine court is set to assign a judge or refer the case to a prosecutor by Monday, according to the Associated Press. If found guilty, Milei could face serious legal consequences that could impact his presidency.
Final Thoughts
The LIBRA scandal highlights the risks of political figures endorsing cryptocurrency projects without due diligence. As the legal proceedings unfold, this case could set a precedent for regulatory scrutiny on political figures involved in crypto promotions.
