New reports on the Libra case, which involves Argentine President Javier Milei and has generated an unprecedented financial and political scandal, point to insider trading.
The Libra token, which was promoted by Argentina's President Javier Milei, has become the center of a controversy that has shaken both the cryptocurrency world and Argentine politics. As reported by this outlet, in a matter of hours, the token went from reaching a market capitalization of more than $4.000 billion to collapse spectacularly, losing more than 95% of its value.
However, what has caught the attention of investigators and the general public are the accusations of insider trading and allegations of fraud brought against Milei.
What happened to the Libra token?
The events began last Friday, when The Argentine president posted a message on his X account publicly supporting the Libra project, which claimed to be aimed at boosting Argentina's economy. The president's promotion sparked a sudden surge of interest in the token, which quickly rose in value. However, the celebrations were short-lived. Hours later, Milei deleted her post and distanced herself from the project., arguing that he was unaware of the internal details of it and had only shared information about it as he does with other projects. Shortly after, the token began to lose value dramatically.
Following this collapse, which caused significant losses to its investors, research firms have focused on finding out what really happened and what Milei's role is in all of this.
BUY BITCOINThe latest reports suggest that a group of investors with access to a private presale had purchased 500 million tokens at prices significantly below market prices. These same investors sold large amounts of tokens during the ensuing chaos, leading to accusations of manipulation and insider trading. According to sources close to the investigation, these insiders managed to withdraw more than $107 million in profits before the token lost virtually all of its value.
On the other hand, the complaints filed by Argentine lawyers point out that Milei's actions were essential in this scheme, since his public endorsement of the token generated an immediate effect on the market, while his subsequent retraction allowed insiders to benefit from the situation. Although the president has denied any personal benefit from the project, the accusations have generated a political and financial debate that has already led an opposition coalition to threaten to an impeachment trial against him.
Pound plummets to cents on the dollar
After reaching a market price of almost $5, the Libra token, developed by KIP Protocol and Hayden Davis, plummeted below fifty cents. At the time of writing, this token remains trading above $0,45, according to data from CoinMarketCap.
The curious thing about Libra is that it was presented as an initiative to boost the Argentine economy. However, since its launch, the project has generated suspicions due to its lack of transparency and the rapid fluctuation of its value. Following Milei's support on social media, the token experienced an exponential increase, reaching a market capitalization of more than $4.000 billion in just a few hours. This sudden growth attracted investors from all over the world, many of whom saw Libra as an opportunity to make quick profits.
TRADE WITH STABLECOINSHowever, enthusiasm turned to chaos when reports of massive insider token sales began to emerge. According to financial analysis, over $87 million was removed from the markets in the first 180 minutes after the token crashed. These transactions, which some experts have called a “rug pull,” left thousands of investors with irreparable losses.
In addition to the fraud allegations, the case has highlighted the risks inherent in the cryptocurrency industry, especially regarding the lack of regulation and unequal access to information. While insiders benefited from huge profits, small investors were forced to absorb the losses.
Fraud allegations and the political implications
The complaints filed against Milei allege that his involvement in the Libra project may have violated several laws, including those related to financial fraud and insider trading. According to the lawyers who filed the complaints, the president's actions were key in the development of the alleged scheme, as his public endorsement of the token generated a direct impact on the market.
Milei has denied any active involvement in the project, arguing that he only shared information about Libra as he does with other projects and companies in Argentina. However, recent documents and statements have revealed that some of The token creators, such as Hayden Davis, had privileged access to funds and tokens before the public launchDavis, who was advising the project, has publicly accused Milei of precipitating Libra's collapse by withdrawing his support.
The case has generated a significant political stir in Argentina, with opposition sectors pointing out that it is a clear example of a “rug pull” and demanding an impeachment trial against him. Meanwhile, the Office of the Presidency has denied any connection between the president and the development of the token, although it has announced an investigation to determine whether any applicable laws were breached.
Finally, despite criticism against the Argentine president for promoting Libra, part of the crypto community has come out in its defense following statements by Hayden Davis, stating that the value of the token had already plummeted by the time Milei withdrew her public support for the project.
SOLANA BUYSInvesting in cryptoassets is not fully regulated, may not be suitable for retail investors due to high volatility and there is a risk of losing all invested amounts.
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