The New York Supreme Court is set to review a highly publicized case involving the Libra token. The lawsuit accuses its creators of misleading investors and siphoning over $100 million through opaque liquidity pools.
The Lawsuit Against Libra
On March 17, Burwick Law filed a lawsuit against Kelsier Ventures, KIP Protocol, and Meteora, accusing them of launching the Libra token in a manner that harmed retail investors. The firm claims the project’s backers artificially inflated the token’s price through a one-sided liquidity pool, allowing insiders to profit while others incurred significant losses. The lawsuit also references Argentine President Javier Milei, who promoted LIBRA as a legitimate economic initiative, though he is not named as a defendant.
The Legacy of the Libra Project
According to research firm Nansen, out of 15,430 largest LIBRA wallets analyzed, 86% recorded losses, totaling $251 million. In contrast, only 2,101 wallets turned a profit, netting $180 million. Kelsier Ventures and CEO Hayden Davis reportedly secured around $100 million from the Libra token launch. Davis has denied direct ownership or sales of the tokens and is facing potential legal action, including an Argentine lawyer’s request for an Interpol red notice against him.
Reactions and Potential Consequences
President Milei has distanced himself from the controversy, claiming he only “spread the word” about the project and did not actively promote it. Meanwhile, Argentina’s opposition party is pushing for his impeachment, though these efforts have been largely ineffective.
The review of this case by the New York Supreme Court could be a pivotal step in addressing transparency issues within the cryptocurrency industry. The public and media attention surrounding this case may have significant implications for the involved parties and for cryptocurrency regulation as a whole.
