Key Takeaways:
- Evidence shows Milei signed NDA-bound advisory agreement with $LIBRA co-creator Hayden Davis.
- Token crashed from $4B to near-zero within hours after Milei’s social media promotion.
- Scandal sparked fraud investigations and congressional scrutiny, testing accountability of Milei’s administration.
What the $LIBRA Token Scandal Reveals About President Milei
The $LIBRA cryptocurrency scandal has emerged as one of the most significant political-financial controversies of Argentina’s presidential term. Argentine prosecutors uncovered evidence suggesting that President Javier Milei had a confidential advisory relationship with $LIBRA co-creator Hayden Davis just weeks before the token’s launch. The token subsequently crashed from billions in market value to near-zero within hours of Milei’s promotion on social media, triggering fraud investigations and congressional scrutiny.
Forensic analysis of electronic devices recovered by the Argentine Public Prosecutor’s Office revealed that Milei signed an NDA-bound advisory agreement with Davis fifteen days before $LIBRA’s February 2025 launch. Blockchain analysts at TRM Labs traced transactions showing Davis-linked wallets transferred approximately $1 million in USDC to intermediaries following the agreement’s signing. This evidence forms the backbone of ongoing fraud probes by Argentine authorities.
Crypto experts have characterized $LIBRA as a textbook “rug pull” scheme, where developers abruptly withdraw liquidity while maintaining public enthusiasm. The incident has prompted opposition politicians and economists to file formal fraud charges, while former President Cristina Fernández de Kirchner publicly labeled Milei a “crypto scammer” on social media platform X. The scandal represents a critical test of accountability mechanisms within Argentina’s young presidential administration.
Judicial Evidence Linking Milei to the $LIBRA Rug Pull
Argentine prosecutors released their findings in a January 2026 Public Prosecutor’s Office report that detailed recovered materials from lobbyist Mauricio Novelli’s phone. The documents showed that Milei and Davis negotiated a confidential blockchain advisory agreement bound by non-disclosure provisions. This agreement predated $LIBRA’s public launch by exactly fifteen days, suggesting premeditated coordination between the presidential office and the token’s creators.
Forensic experts identified five message exchanges between Milei and Novelli occurring at the precise moment when Milei posted $LIBRA’s non-public contract address on his X account. Blockchain analysts noted these communications happened before retail investors could access the token, creating an information asymmetry that benefited insiders. TRM Labs documented that Davis-linked wallets transmitted roughly $1 million in USDC to intermediaries shortly after the advisory agreement was executed.
The judicial evidence also revealed that developers withdrew liquidity from the token’s pools immediately after Milei’s post generated massive retail buying pressure. This pattern of behavior aligns with established indicators of cryptocurrency fraud, according to blockchain forensics specialists. Prosecutors have stated that the recovered materials constitute sufficient grounds to continue investigating potential securities law violations and abuse of official position.
How $LIBRA Crashed From Billions to Near-Zero After Milei’s Post
The token’s market capitalization reached approximately $4 billion within minutes of Milei’s social media promotion, driven by retail investors following the president’s account. However, the token’s value collapsed by over 99% within hours as insiders executed coordinated liquidity withdrawals. Crypto traders documented that the crash followed a pattern consistent with pre-planned exit schemes, where developers drain remaining funds while outside buyers are still entering positions.
According to analyses from multiple blockchain research firms, insiders profited approximately $251 million from the scheme before the token’s value collapsed. The rapid depreciation wiped out billions in market value, affecting thousands of retail investors who purchased tokens based on the presidential endorsement. Cryptocurrency analyst Zhu Su, co-founder of Three Arrows Capital, attributed the crash to systematic liquidity pool withdrawals combined with arbitrage exploitation by sophisticated traders.
The token’s contract address was not publicly available before Milei’s post, meaning only those with advance knowledge could have participated in early trading phases. This detail has fueled accusations that the presidential promotion served as a coordinated signal to insiders rather than a genuine economic recommendation. Following the crash, the token’s trading volume collapsed to negligible levels, leaving remaining holders with effectively worthless assets.
Political and Legal Consequences for Milei
Congressional findings against the president
An Argentine congressional committee dominated by opposition parties conducted its own investigation into the $LIBRA incident. The committee concluded that Milei “used the presidential office” to aid the cryptocurrency scheme, marking an extraordinary bipartisan rebuke of the sitting president. Lawmakers recommended a formal review of potential malfeasance charges, though such proceedings face significant procedural obstacles in Argentina’s political system.
The congressional report detailed timeline evidence showing coordination between the presidential office and $LIBRA’s development team before the token’s launch. Committee members argued that the use of official presidential authority for private financial promotion constituted an abuse of power. The findings have strengthened opposition calls for accountability mechanisms, though the president’s allies control sufficient legislative seats to block most punitive measures.
Milei’s denial and Anti-Corruption Office clearance
President Milei has consistently denied any involvement in the $LIBRA scheme beyond sharing what he characterized as a personal investment post. His administration has maintained that the president acted in good faith without knowledge of any fraudulent scheme. The president’s legal team has pointed to the absence of documented direct payments as evidence of his innocence.
Milei’s own Anti-Corruption Office subsequently cleared him of wrongdoing, determining that insufficient evidence existed to pursue administrative proceedings. The office’s clearance focused on whether presidential actions violated Argentina’s disclosure and conflict-of-interest regulations. However, critics have noted the inherent conflict of interest in investigating the president through his own appointed officials, and opposition figures have called for an independent external review.
FAQ about $LIBRA token
What is the $LIBRA cryptocurrency scandal involving President Milei?
The $LIBRA scandal involves President Javier Milei’s social media promotion of a cryptocurrency token that subsequently crashed from billions in value to near-zero. Argentine prosecutors recovered evidence of a pre-launch advisory agreement between Milei and the token’s co-creator.
Did prosecutors find evidence of a $5 million payment to Milei?
Prosecutors recovered drafts of a confidential advisory agreement between Milei and $LIBRA co-creator Hayden Davis, but no documented $5 million payment has been found. Evidence shows approximately $1 million in USDC transfers from Davis-linked wallets to intermediaries after the agreement.
How did the $LIBRA token crash and lose billions in value?
The token reached $4 billion in market cap within minutes of Milei’s post before collapsing over 99% within hours. Analysts identified coordinated liquidity withdrawals by developers, with insiders profiting approximately $251 million while retail investors lost billions.
What judicial evidence links Milei to the $LIBRA scheme?
Forensic analysis recovered five message exchanges between Milei and lobbyist Mauricio Novelli at the exact time of Milei’s post. Prosecutors also found that Milei signed an NDA-bound advisory agreement with Davis fifteen days before $LIBRA’s launch.
Is Milei facing consequences for promoting $LIBRA?
An Argentine congressional committee concluded Milei “used the presidential office” to aid the scheme and recommended malfeasance review. However, Milei’s Anti-Corruption Office cleared him of wrongdoing, and no formal charges have been filed as of early 2026.
