Argentine President Javier Milei recently became the centre of a cryptocurrency controversy after his Solana-based memecoin, $LIBRA, crashed by over 95%.
Milei has been a pro-crypto advocate. Although fondly known for his massive success in lifting the Argentinian economy, he has been publicly involved in cryptocurrencies since 2021.
On Friday, around 22:01 PM GMT, Milei posted the $LIBRA token through his official X account. According to the tweet, the project will be used as a catalyst for Argentina’s growth and to fund small Argentina startups.
He also linked it to the “Viva La Libertad Project.” The project claimed to support Argentina’s economy by funding small businesses and startups.
At first, the market was skeptical about this, as different official X accounts have been hacked previously. However, as several other Argentina government officials posted the token, traders rushed to buy the token.
This saw its market capitalization rise to an astonishing $4.5 billion within hours. At its peak, $LIBRA reached a price of $4.50.
LIBRA Red Flag Surface
Within hours, the price of $LIBRA plummeted by nearly 90%, crashing to $0.50. According to On-chain analysts, one of the several red flags was the concentration of 82% of the token supply in a few wallets, which fueled the token’s rapid decline.
Analysts also revealed that the Libra website was created hours before its launch, and it links to a Google form.
As the controversy escalated, Milei deleted his promotional tweet and issued a clarification. He stated he had no connection to the project and had not conducted proper due diligence before endorsing it.
“I initially supported a supposed private enterprise with which I have no connection. After becoming aware of the details, I stopped spreading the word,” Milei explained.
Despite his attempt to distance himself from the project, the damage was already done, with many investors suffering significant losses.
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