Argentine
President #JavierMilei is facing significant political turmoil following his
promotion of the $LIBRA cryptocurrency, which experienced a dramatic drop in
value shortly after his endorsement. The incident has led to widespread
allegations of fraud and calls for his impeachment.
**The $LIBRA Controversy
On 14 February 2025, #presidentmilei used his official social media platforms
to promote $LIBRA, a newly launched cryptocurrency on the Solana platform. His
endorsement caused the value of the token to skyrocket from a fraction of a
cent to $5.20 within 40 minutes. However, the surge was short-lived as the
coin's value plummeted by 85% just hours later, resulting in significant
financial losses for some 74,000 investors. Reports suggest that $LIBRA's
founders liquidated their holdings during the spike, amassing around $87
million and triggering the crash - a manoeuvre commonly referred to as a
"rug pull".
**Political fallout**
The fallout from the $LIBRA scandal was swift and severe. Opposition lawmakers,
particularly from the Union for the Homeland (UxP) alliance, have initiated
impeachment proceedings against President Milei, calling his involvement an
"unprecedented scandal". Former President Cristina Fernández de
Kirchner criticised Milei, describing him as "the hook of a digital
fraud". Despite these efforts, the impeachment initiative currently lacks
sufficient support within the impeachment commission to move forward.
In addition to political challenges, legal action is underway. A federal judge
in Argentina has been tasked with investigating President Milei's role in
promoting $LIBRA, focusing on potential fraud and misconduct. The investigation
aims to determine the extent of Milei's involvement and whether any laws were
broken.
**Market impact
The scandal has also had an impact on Argentina's financial markets. The Global
X MSCI Argentina exchange traded fund, which tracks Argentine equities, fell
0.6% following the controversy. Analysts say that while the immediate impact on
Argentine assets may be limited, the incident could undermine confidence in the
government's economic management and discourage future investment.
President Milei's response.
In response to the allegations, President Milei has denied any intentional
wrongdoing, claiming that he promoted $LIBRA in good faith to support Argentine
entrepreneurship. He claimed a lack of detailed knowledge about the project at
the time of his endorsement and has since removed the promotional content from
his social media accounts. The government has asked the Anti-Corruption Office
to investigate the matter to determine whether there was any wrongdoing within the
government.
Close
The $LIBRA cryptocurrency scandal has plunged President Javier Milei into the
deepest crisis of his term, with political, legal and economic challenges all
intertwined. As investigations continue and political debates intensify, the
long-term implications for Milei's presidency and Argentina's financial
stability remain uncertain.
#libra
$Libra