Argentine President Javier Milei is grappling with the threat of impeachment after backing a cryptocurrency initiative that disastrously crumbled, identified by experts as a significant insider fraud. The controversial Libra (LIBRA) token, built on the Solana platform, started its surge on Feb. 14, moments after Milei promoted the scheme on X, previously known as Twitter. The post, which has since been deleted, contained a website and a contract address for the token, a “private project” aimed at “stimulating the growth of the Argentine economy.”
The Libra token fleetingly escalated to a top market capitalization of $4.56 billion at 10:30 pm UTC on Feb. 14 before it plummeted over 94% to a mere $257 million market cap within 11 hours of its debut on decentralized exchanges, as Dexscreener data reveals.
Milei may soon confront impeachment proceedings as Argentina’s fintech chamber has conceded that this could be a rug pull situation. “We must initiate an impeachment motion against the president due to this internationally embarrassing scandal,” opposition legislator Leandro Santoro told Reuters in a Feb. 16 report.
Following the token’s dramatic fall on Feb. 15, Milei published a statement on X, clarifying that he was oblivious to the project specifics during his endorsement and that he holds “no connection whatsoever” with the “private enterprise” that launched the token. Milei also warned that his political adversaries may exploit this situation, stating: “To the despicable rodents of the political class, who seek to capitalize on this circumstance for damage, I say that they reaffirm their sordid nature daily and strengthen our resolve to kick them out.”
Despite Milei’s attempt to retract his endorsement, at least eight insider wallets associated with the Libra team successfully liquidated over $107 million in liquidity. This involved 57.6 million USD Coin (USDC) and 249,671 Solana (SOL) valued at $49.7 million, according to onchain intelligence agency Lookonchain.
Insider wallets began draining the token merely three hours after its trading debut, resulting in its over 94% drop, as revealed by data from the Kobeissi Letter. Other blockchain analytics companies had previously raised concerns about the project’s tokenomics. Blockchain analytics firm Bubblemaps had cautioned about LIBRA’s flawed tokenomics, disclosing that 82% of the supply was immediately unlocked and available for sale.
Furthermore, the project offered no preliminary details about its tokenomics, a critical red flag among crypto investors. The desire for celebrity-endorsed memecoins among retail investors has escalated since US President Donald Trump launched his Official Trump (TRUMP) memecoin on Jan. 18, succeeded by First Lady Melania Trump’s Melania Meme (MELANIA) token on Jan. 19 on the Solana network ahead of his inauguration on Jan. 20.
