Argentine President Javier Milei faces mounting pressure as federal prosecutors investigate his promotion of the $LIBRA cryptocurrency following its rug pull collapse. The controversial meme coin, launched last week under suspicious circumstances, highlights growing concerns about crypto-based financial scams targeting retail investors.
Milei publicly endorsed $LIBRA on social media Friday, calling it a tool for funding small businesses and startups. The token briefly surged to a $4 billion market cap before crashing 98% as early investors cashed out – a textbook case of alleged crypto market manipulation.
New technologies often look like toys but evolve into powerful tools,Coinbase CEO Brian Armstrong noted days before the scandal emerged, inadvertently foreshadowing the crisis.
Key figures in the cryptogate controversy include:
- Hayden Davis: 28-year-old developer linked to both $LIBRA and Melania Trump’s failed cryptocurrency
- Meow: Pseudonymous crypto firm co-founder now facing insider trading allegations
- Dave Portnoy: Barstool Sports founder who promoted $LIBRA before its collapse
Prosecutors allege potential crimes ranging from fraud to abuse of authority. Milei denies wrongdoing while paradoxically requesting his own anti-corruption probe. The scandal arrives as Argentina seeks IMF support for economic reforms, raising questions about political stability in South America’s second-largest economy.
The $LIBRA controversy mirrors crypto crashes involving celebrity tokens:
Melania Trump’s MAGA coin followed an identical boom-bust pattern last month. Viral sensation Hawk Tuah Girl saw her token collapse amid scam accusations, while Caitlyn Jenner faces lawsuits over $JENNER’s implosion. Even the Central African Republic’s gov-backed crypto plummeted within days of launch.
Major questions persist about Milei’s crypto advocacy as he courts Elon Musk and Silicon Valley leaders. With 56% inflation and $44B IMF debt negotiations pending, analysts warn this scandal could derail Argentina’s fragile economic recovery. The case underscores regulatory gaps enabling meme coin speculation – a casino where retail investors too often bankroll insider windfalls.
