Update Feb. 16, 12:01 pm UTC: This article has been updated to add a statement from Argentina’s presidential office.
Argentine President Javier Milei is facing calls for impeachment after endorsing a cryptocurrency project that collapsed in what analysts are calling a massive insider scam.
The Solana-native Libra (LIBRA) token started its rally on Feb. 14, shortly after Milei posted about the project on X, formerly Twitter. His now-deleted post included a website and contract address for the token, which was a “private project” dedicated to “encouraging the growth of the Argentine economy.”
Milei’s deleted X post. Source: Kobeissi Letter
The Libra token briefly rose to a peak market capitalization of $4.56 billion at 10:30 pm UTC on Feb. 14 before falling over 94% to a $257 million market cap in just 11 hours since the token debuted for trading on decentralized exchanges, Dexscreener data shows.
LIBRA/USDC, all-time chart. Source: Dexscreener
Milei may now face the risk of impeachment after Argentina’s fintech chamber acknowledged that the case may be a rug pull.
“This scandal, which embarrasses us on an international scale, requires us to launch an impeachment request against the president,” opposition lawmaker Leandro Santoro told Reuters, according to a Feb. 16 report.
After the token’s collapse on Feb. 15, Milei issued a statement on X, noting that he was not aware of the details of the project when he endorsed it and that he has “no connection whatsoever” with the “private enterprise” that launched the token.
Source: Javier Milei
Milei also added that his political opponents will look to take advantage of the situation, adding:
“To the filthy rats of the political caste who want to take advantage of this situation to do harm, I want to say that every day they confirm how vile politicians are, and they increase our conviction to kick them in the ass.”
Milei has requested the Anti-Corruption Office to investigate all government members, including the president himself, for potential misconduct, according to a Feb. 16 X statement issued by Argentina’s presidential office, Oficina del Presidente.
The statement also revealed that Milei held a meeting with KIP Protocol representatives on Oct. 19, 2024, in Argentina, where the company informed him about the Libra blockchain project and its aims to finance private ventures in the country.
Statement Argentina’s Presidential Office. Source: Oficina del Presidente
Milei also met with mysterious crypto entrepreneur Hayden Mark Davis at Casa Rosada on Jan. 30, who was presented to the president as an infrastructure partner for the project.
“All information gathered during the investigation will be handed over to the courts to determine whether any of the companies or individuals linked to the KIP Protocol project committed a crime,” added the statement.
Related: Over 600K new tokens launched in January, sparking liquidity fears
Milei-endorsed Libra token’s $4 billion crash: What you need to know
Despite Milei deleting his initial endorsement, at least eight insider wallets linked to the Libra team managed to cash out over $107 million worth of liquidity.
This included 57.6 million USD Coin (USDC) and 249,671 Solana (SOL) worth $49.7 million, according to onchain intelligence firm Lookonchain:
Libra insider wallets. Source: Lookonchain
Insider wallets started cashing out on the token only three hours after it debuted for trading, causing its over 94% decline, according to data shared by the Kobeissi Letter.
Source: Kobeissi Letter
Other blockchain data firms have warned about the project’s tokenomics even before the meltdown. Blockchain analysis firm Bubblemaps had warned about LIBRA’s flawed tokenomics, revealing that 82% of the supply was unlocked and sellable from the start.
Libra token clusters. Source: Bubblemaps
Moreover, the project shared no preliminary information about its tokenomics, a major red flag among crypto traders.
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Retail investor appetite for celebrity-endorsed memecoins has been boosted since US President Donald Trump launched his Official Trump (TRUMP) memecoin on Jan. 18, followed by First Lady Melania Trump’s Melania Meme (MELANIA) token on Jan. 19 on the Solana network ahead of his inauguration on Jan. 20.
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