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Argentina's $LIBRA Scandal – Crypto Rug Pull Political
President Milei of Argentina promotes $LIBRA, but the price drops sharply → losses of $250 million, referred to as “Cryptogate”. Suitable as a case study of political risks in crypto and caution against politically labeled rug pulls – important education for novice investors.
#LIBRARugPull
President Milei of Argentina promotes $LIBRA, but the price drops sharply → losses of $250 million, referred to as “Cryptogate”. Suitable as a case study of political risks in crypto and caution against politically labeled rug pulls – important education for novice investors.
#LIBRARugPull
Scandal Involving the LIBRA Meme coin and Javier Milei: How the Scheme Worked
Argentine President Javier Milei found himself at the center of a scandal after posting information about the LIBRA memecoin on social media platform X on February 14, 2025. The memecoin was purportedly designed to attract investments for small businesses in Argentina. This incident sparked widespread public outcry, led to a crash in the cryptocurrency's value, and prompted accusations of fraud against the president, even fueling calls for his impeachment.
What is a Memecoin?
Memecoins are cryptocurrencies with no fundamental value, whose price depends entirely on community interest. Often, these tokens become tools for manipulation, with creators leveraging hype to sell assets at inflated prices. Such schemes are commonly known as "rug pulls," where insiders sell off their tokens and withdraw liquidity, causing the price to plummet.
How Did the LIBRA Situation Unfold?
1. Promotion of the Memecoin: On February 14, Javier Milei posted on X about the LIBRA project, claiming that the cryptocurrency was intended to stimulate Argentina's economy by funding small businesses and entrepreneurs. The post included a link to the project's website and the memecoin's contract address.
2. Rise and Fall of the Price: Following Milei's post, LIBRA's value skyrocketed, reaching a market capitalization of $4.5 billion. However, shortly after, insiders sold their holdings at the peak, earning over $100 million, and the price crashed by 95%.
3. Milei's Reaction and Consequences: Milei deleted the post and distanced himself from the project. Opposition leaders and investors heavily criticized the president, demanding compensation for losses and initiating impeachment proceedings.
Accusations Against Milei
Milei has been accused of ethical violations and involvement in crypto fraud. Political opponents have filed lawsuits, and the Peronist opposition bloc announced the start of impeachment proceedings. Milei defended himself by stating that he was merely "sharing an opportunity to fund entrepreneurs" and did not intend to persuade people to buy the token. He also admitted that he needed to "establish more filters" to limit access to himself.
Expert Opinions
Analysts have described the LIBRA scandal as the biggest crisis for Milei's administration since he took office in December 2023. This case is unprecedented, as it marks the first time a sitting head of state has been implicated in such a scheme.
What is a "Rug Pull" Scheme?
A "rug pull" is a type of cryptocurrency fraud where developers suddenly withdraw all funds from a project, leaving investors with worthless assets. This typically occurs after aggressive promotion of the token and the attraction of a large number of investors.
#LIBRARugPull #Rugpull
What is a Memecoin?
Memecoins are cryptocurrencies with no fundamental value, whose price depends entirely on community interest. Often, these tokens become tools for manipulation, with creators leveraging hype to sell assets at inflated prices. Such schemes are commonly known as "rug pulls," where insiders sell off their tokens and withdraw liquidity, causing the price to plummet.
How Did the LIBRA Situation Unfold?
1. Promotion of the Memecoin: On February 14, Javier Milei posted on X about the LIBRA project, claiming that the cryptocurrency was intended to stimulate Argentina's economy by funding small businesses and entrepreneurs. The post included a link to the project's website and the memecoin's contract address.
2. Rise and Fall of the Price: Following Milei's post, LIBRA's value skyrocketed, reaching a market capitalization of $4.5 billion. However, shortly after, insiders sold their holdings at the peak, earning over $100 million, and the price crashed by 95%.
3. Milei's Reaction and Consequences: Milei deleted the post and distanced himself from the project. Opposition leaders and investors heavily criticized the president, demanding compensation for losses and initiating impeachment proceedings.
Accusations Against Milei
Milei has been accused of ethical violations and involvement in crypto fraud. Political opponents have filed lawsuits, and the Peronist opposition bloc announced the start of impeachment proceedings. Milei defended himself by stating that he was merely "sharing an opportunity to fund entrepreneurs" and did not intend to persuade people to buy the token. He also admitted that he needed to "establish more filters" to limit access to himself.
Expert Opinions
Analysts have described the LIBRA scandal as the biggest crisis for Milei's administration since he took office in December 2023. This case is unprecedented, as it marks the first time a sitting head of state has been implicated in such a scheme.
What is a "Rug Pull" Scheme?
A "rug pull" is a type of cryptocurrency fraud where developers suddenly withdraw all funds from a project, leaving investors with worthless assets. This typically occurs after aggressive promotion of the token and the attraction of a large number of investors.
#LIBRARugPull #Rugpull
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