The LIBRA token became embroiled in scandal following corruption allegations and a sharp drop in the crypto market. At the center of attention are claims about the token creator's connections with the Argentine president's family.
Allegations Against Hayden Davis
The creator of the LIBRA token, Hayden Davis, claims he paid Karina Milei, sister of Argentine President Javier Milei, to gain access to the president’s inner circle and influence government decisions, according to messages seen by *CoinDesk*. Text messages reviewed indicate Davis allegedly bragged about his influence over President Milei, claiming that he could make him sign and promote anything in exchange for payments to Karina Milei. However, Davis denied sending the messages, stating he had no record of such messages on his phone. He also issued a statement saying that recent media reports claiming he paid President Javier Milei or his sister to launch the LIBRA memecoin are completely false.
LIBRA Token's Collapse
Launched on the Solana blockchain, LIBRA reached a market cap of $4.5 billion before crashing 95% within hours. Davis and his firm, Kelsier Ventures, reportedly netted over $100 million from the token’s rise and fall. Reports indicate Davis’ team dumped large amounts of LIBRA tokens before the price collapse, raising concerns of insider trading. Blockchain analysts revealed eight wallets associated with the LIBRA team withdrew $107 million before the crash.
President's Response to Allegations
President Javier Milei promoted LIBRA on X (formerly Twitter) on February 14, fueling the token’s massive surge. However, he deleted the tweet just five hours later. In an interview, he distanced himself from the project, claiming: “I did not promote that. I just spread the word.” Opposition leaders argue his endorsement was crucial in misleading investors, with some calling for an impeachment trial. The incident, dubbed "Criptogate," has shaken Argentina’s financial markets. Legal experts accuse Milei of participating in an "illicit association" designed to defraud investors. The case is now under review by Argentina’s criminal justice system. Milei’s administration has requested an anti-corruption investigation into all government officials linked to LIBRA. However, critics argue this is a desperate attempt at damage control.
The scandal surrounding LIBRA has highlighted serious concerns about the intersection of business and politics in Argentina and underscored the importance of transparency and trust in the cryptocurrency industry. The ongoing investigation may change the perception of crypto markets in the country and lead to regulatory changes in the sector.
