Libra Coin ($LIBRA) Scandal: Argentine President Milei's Involvement in Alleged Cryptocurrency Fraud

In February 2025, a major cryptocurrency scandal emerged involving the $LIBRA coin, which saw a rapid surge in value following a high-profile endorsement from Argentine President Javier Milei. 

However, the coin's value collapsed shortly after, leading to significant financial losses for investors and sparking widespread allegations of fraud. 

Milei's involvement has led to political and legal repercussions, with accusations that the cryptocurrency's promotion was a "scam" orchestrated to deceive the public. 

This case has garnered international attention and raised questions about the role of politicians in cryptocurrency promotions. Let's dive into the details of the $LIBRA scandal and its implications for President Milei's administration and the Argentine economy.

Overview of the Libra Coin Scandal

The $LIBRA cryptocurrency made headlines when Argentine President Javier Milei promoted it on social media in mid-February 2025. Milei described $LIBRA as a project designed to stimulate economic growth by supporting small businesses and startups. 

This endorsement caused a massive spike in the coin’s value, pushing it from near zero to around $5 in a short period. However, just days later, the value of $LIBRA plummeted below $1, resulting in substantial losses for investors.

Read also: Libra Crypto Crash: How a $4.5B Memecoin Vanished Overnight

Legal and Political Fallout

Following the collapse of $LIBRA, several parties filed fraud complaints against President Milei, accusing him of participating in an illicit scheme. 

Legal experts claim that Milei's endorsement played a crucial role in inflating the coin's value, making it a textbook example of a "rug pull" scam. In such schemes, developers artificially inflate the value of a project before abandoning it, leaving investors with worthless assets.

In response, Milei denied any involvement in the project, stating that he was unaware of the details of $LIBRA at the time of his endorsement. 

He further claimed that political adversaries were exploiting the situation to tarnish his image and undermine his administration. 

Despite this, opposition lawmakers have called for his impeachment, arguing that the scandal has caused irreparable harm to Argentina's reputation and investor confidence.

Key Figures in the $LIBRA Scandal

President Javier Milei

As the key political figure behind the $LIBRA endorsement, Milei's actions have been heavily criticized. While he has denied involvement, his promotion of the cryptocurrency is central to the case.

Hayden Mark Davis

One of the creators of $LIBRA, Davis has called the project an "experiment" that ultimately failed. He faces criticism for his role in the cryptocurrency's rise and fall.

Julian Peh

CEO of Kip Network and KIP Protocol, Peh's companies played a role in the creation of $LIBRA. Investigations are ongoing to determine his level of involvement in the alleged fraud.

Martin Menem

Speaker of the Lower House and a member of Milei's party, Menem’s repost of Milei's endorsement has led to questions about his possible involvement in the promotion of the coin.

Observatorio del Derecho a la Ciudad

This NGO filed a lawsuit accusing Milei and other government officials of orchestrating the scam. The lawsuit claims that over 40,000 people were affected, resulting in losses exceeding $4 billion.

Judge María Servini

Assigned to lead the investigation into the fraud allegations, Judge Servini will determine the extent of involvement by Milei and other parties in the scandal.

Read also: The LIBRA Token Scandal: President Milei, Hayden Davis, and Argentina’s Crypto Nightmare

Political and Financial Impact

The $LIBRA scandal has caused significant political fallout in Argentina. With opposition lawmakers calling for Milei's impeachment, the incident has sparked a broader debate about the role of politicians in cryptocurrency promotions. 

Additionally, the country’s financial markets reacted negatively, with the S&P Merval, Argentina’s main stock index, falling by nearly 4% following the scandal.

Analysts fear that this controversy could erode investor confidence in Milei’s economic reform agenda, potentially undermining his efforts to stabilize the Argentine economy. The international implications are also concerning, as the scandal could further damage Argentina's reputation on the global stage.

Conclusion

The $LIBRA cryptocurrency scandal has shaken the Argentine political landscape, with President Javier Milei at the center of a growing legal and political storm. 

Whether Milei was knowingly involved in the alleged fraud or simply acted out of ignorance remains to be seen. 

However, the incident has sparked serious questions about the ethics of political leaders promoting speculative investments and the broader risks associated with the volatile world of cryptocurrencies. 

As the investigation continues, all eyes are on Milei’s administration to see how this controversy unfolds.

FAQ

What is the $LIBRA cryptocurrency scandal about? 

The $LIBRA scandal revolves around Argentine President Javier Milei's endorsement of the cryptocurrency, which surged in value before crashing, leading to substantial financial losses and accusations of fraud.

Why is President Milei being investigated?

President Milei is being investigated for his role in promoting $LIBRA, which some claim was part of an illicit scheme to inflate the coin's value before its collapse, leaving investors with worthless assets.

What are the political consequences for Milei?

The scandal has led to calls for President Milei’s impeachment from opposition lawmakers, as it has damaged his reputation and raised concerns about investor confidence in his economic policies.

How has the financial market reacted to the $LIBRA scandal?

Argentina's main stock index, the S&P Merval, fell nearly 4% following the scandal, and analysts are concerned about the potential long-term effects on Argentina’s economy and Milei's reforms.