What Happens With LIBRA? A Summary of the Scandal

The launch of LIBRA, a memecoin promoted by Argentine president Javier Milei, shocked the cryptocurrency world, sparking a series of scandals that have shaken both the local and global markets. 

Initially pitched as a project aimed at funding Argentina’s development, LIBRA quickly escalated into one of the most controversial tokens of recent memory. Let’s break down the events surrounding its rise and fall.

Launch of LIBRA: A Promising Start or a Planned Exit?

LIBRA made its debut with the backing of Kelsier Ventures, a firm that helped facilitate the coin’s creation. The token aimed to bring substantial financial relief to Argentina, with the bold claim of supporting the country’s development. 

The early excitement was palpable. Investors piled in, and the coin soared, reaching an astonishing $4.5 billion in Fully Diluted Valuation (FDV) on immense volume.

However, things soon began to unravel. Initially launched with a single-sided liquidity pool (LP) via Meteora, liquidity was progressively drained as the price surged. 

While LIBRA gained momentum, the truth behind its supply began to surface—95% of the coin’s total supply was unlocked to insiders and the development team, raising immediate concerns.

The fallout was swift. As these revelations spread, the price of LIBRA plummeted. The coin, which had once commanded immense attention, saw its market cap fall from billions to a mere $300 million. 

This drop was only exacerbated by Milei’s public distancing from the project, which triggered a fraud investigation in Argentina.

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

The KOL Involvement: A Web of Deception

Insider knowledge played a central role in the LIBRA debacle. Several influential Key Opinion Leaders (KOLs) were aware of the coin’s impending launch. Some were even paid to promote it, further fueling the coin’s initial surge. 

Prominent figures such as Dave Portnoy were involved in the promotion, although Portnoy later reimbursed his allocation. Nevertheless, he was still compensated for his trading losses, highlighting the level of manipulation at play.

This insider involvement extended beyond just promotional efforts. Kelsier Ventures listed various influencers as partners, deepening suspicions about the role of these figures in the coin’s rise and subsequent fall. 

Leaked screenshots have added fuel to these rumors, showing just how extensively KOLs were involved in promoting LIBRA before and after its launch.

Read Also: How to Buy LIBRA

The Coffeezilla Interview: Kelsier Ventures Under Fire

The situation reached a boiling point when Hayden Davis, the founder of Kelsier Ventures, appeared on Coffeezilla for a revealing interview. In this conversation, Davis openly admitted to sniping LIBRA’s supply and taking advantage of the massive team allocation. He even confirmed that $110 million raised from LIBRA was leveraged in other negotiations.

Davis’s transparency, or lack thereof, exposed not just the inner workings of LIBRA, but also revealed a broader pattern of insider trading. 

He confessed to his involvement in other controversial projects, such as MELANIA, and disclosed that TRUMP token insiders had been allowed to buy in at $500 million FDV before its official launch. 

This interview not only shook the foundation of LIBRA but also questioned the ethics of those at the helm of multiple similar projects.

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

Meteora, Jupiter & Moonshot: The Allegations Continue

As the scandal expanded, Meteora, Jupiter, and Moonshot companies linked to LIBRA’s launch found themselves under scrutiny. While these firms denied any involvement in insider trading, there was a growing consensus that leaks had occurred within their teams, allowing certain insiders to act on privileged information.

In a shocking admission, the CEO of Meteora revealed that they had collaborated with Kelsier on other launches, including $M3M3. 

Despite the poor market-making performance—likely due to dumping from team side wallets—Meteora still referred Kelsier to other clients, further casting doubt on the integrity of their operations.

The Impact on the Solana (SOL) Ecosystem

The consequences of LIBRA’s disastrous launch rippled through the Solana (SOL) ecosystem. Solana’s price took a hit, dropping by 10% as the controversy surrounding the project intensified. DeFi coins built on SOL followed suit, losing 10-20% of their value, while SOL-based memes and AI tokens saw declines of 20-40%. 

The debacle sparked discussions about the future of SOL, with some speculating that this could mark the end of the "SOL casino" for the time being, as ETH and BNB began to outperform.

Read Also: Solayer and sUSD: The Future of Yield-Bearing Stablecoins on Solana

Conclusion

The LIBRA scandal serves as a cautionary tale for the crypto community. From insider trading to deceptive promotional tactics, the series of events surrounding the token’s launch has not only tarnished the reputation of its backers but also shed light on broader issues within the cryptocurrency space. 

With Milei facing fraud charges in Argentina and Kelsier Ventures under fire for their role in multiple pump-and-dump schemes, this scandal is far from over. 

For investors and enthusiasts alike, the key takeaway is clear: always do your own research, as the crypto space remains rife with manipulation.

FAQ

Q: What was the purpose of the LIBRA memecoin?
A: LIBRA was launched with the goal of funding Argentina’s development, backed by Javier Milei and Kelsier Ventures. However, the project quickly became embroiled in controversy.

Q: How did LIBRA's price perform after launch?
A: LIBRA initially surged to a $4.5 billion FDV, but as it became clear that 95% of the supply was unlocked to insiders, the price plummeted, eventually dropping to just $300 million.

Q: Why did Javier Milei distance himself from the LIBRA project?
A: Milei distanced himself after the project’s issues became public, with allegations of insider trading and fraud, leading to fraud charges against him in Argentina.

Q: What role did influencers play in the LIBRA launch?
A: Several Key Opinion Leaders (KOLs) were paid to promote LIBRA before its launch. Some influencers, like Dave Portnoy, were involved in promoting the coin despite later reimbursing their allocations.

Q: What did Hayden Davis reveal in the Coffeezilla interview?
A: Hayden Davis, founder of Kelsier Ventures, admitted to sniping LIBRA’s supply, using $110 million from the project for leverage in negotiations, and involving insider KOLs for promotion.

Q: How did LIBRA affect the Solana (SOL) ecosystem?
A: The LIBRA scandal negatively impacted the Solana ecosystem, causing its price to drop by 10%, while many Solana-based DeFi coins, memes, and AI tokens saw significant losses.

Q: What is the current state of the LIBRA project?
A: After the crash and ongoing investigations, LIBRA remains a cautionary tale about the risks of insider trading and deceptive promotional tactics in the crypto market. Milei faces legal charges, and the project's credibility is severely damaged.

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