Argentine President Javier Milei’s recent endorsement of the LIBRA token has sparked one of the most dramatic scandals in the cryptocurrency market—and it’s reverberating far beyond Argentina’s borders. What began as a high-profile tweet promising economic revitalization quickly transformed into a cautionary tale of memecoin mania, insider trading allegations, and potential political downfall.
Quick Take
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LIBRA’s market cap surged to $4.56B following Milei’s tweet before crashing 94% to just $257M in under 11 hours.
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Insider wallets cashed out approximately $107M in liquidity within hours of the token launch.
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Flawed tokenomics—with 82% of the total supply unlocked at launch—enabled a coordinated rug pull.
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Over 40,000 investors suffered significant losses, intensifying political and legal backlash.
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The scandal has sparked impeachment calls and underscores the urgent need for tighter crypto regulation.
A Tweet That Shook Markets: From $4.56B High to a 94% Crash in Under 11 Hours
Source: Cointelegraph
On February 14, President Milei used his verified X account to promote LIBRA—a token touted as a means to “incentivize the growth of the Argentine economy” by funding small businesses. Within hours, the token’s market cap soared, briefly reaching a staggering $4.56 billion. However, what looked like an economic miracle turned into a catastrophic collapse as insider wallets began to siphon off liquidity. In just a few hours, LIBRA’s value plummeted by over 94%, wiping out billions in investor capital and triggering accusations of a well-orchestrated rug pull.
Read more: What Is a Crypto Rug Pull, and How to Avoid the Scam?
Source: Bubblemaps on X
Inside the LIBRA Rug Pull: $107M Cashed Out by 8 Insider Wallets
Blockchain analytics soon painted a grim picture. Firms like Bubblemaps revealed that 82% of LIBRA’s supply was unlocked and sellable from the start—an inherent red flag in tokenomics that left the door wide open for manipulation. On-chain data confirmed that at least eight wallets associated with the LIBRA team rapidly cashed out, extracting over $107 million in liquidity within hours of launch. Such coordinated trading activities fueled a $4 billion market cap wipeout and left retail investors reeling.
Source: Jupiter on X
Adding fuel to the fire, insiders within the decentralized exchange Jupiter disclosed that the token’s launch was an “open secret” in memecoin circles, with some team members learning about LIBRA’s imminent debut two weeks in advance through Kelsier Ventures. Yet, Jupiter has firmly denied any involvement in the suspicious trading activities, asserting that no employees received LIBRA tokens or any related compensation. Their internal investigation reportedly found no evidence of insider trading.
Flawed Tokenomics Exposed: 82% of LIBRA’s Supply Unlocked from Day One
Critical to the scandal was LIBRA’s precarious tokenomics structure. Experts noted that an alarming 82% of the total supply was unlocked and available for sale immediately upon launch. Such a design left the token highly susceptible to market manipulation, providing the perfect setup for insiders to profit at the expense of unsuspecting investors.
40,000+ Investors Hit and Milei’s Impeachment Calls Emerge
The LIBRA debacle has ignited a fierce political and legal firestorm in Argentina. With over 40,000 investors reportedly suffering significant financial losses, opposition lawmakers and a group of Argentine lawyers have leveled serious accusations against President Milei. They claim that his endorsement—and subsequent deletion—of the LIBRA post constituted a deliberate act of fraud, effectively orchestrating a "rug pull" that manipulated market sentiment for insider gains.
Prominent political figures, including former President Cristina Fernández de Kirchner, have joined the chorus of critics, with some calling for impeachment proceedings. In response, Milei has maintained that he was unaware of the project’s underlying risks and that his tweet was just one in a series of endorsements for private ventures. His administration has now called for an investigation by the Anti-Corruption Office to probe potential breaches of public ethics and misuse of presidential authority.
Echoes of Memecoin Mania and the Road Ahead
The LIBRA incident is not an isolated case. It echoes previous memecoin scandals, such as those involving tokens promoted by former U.S. President Donald Trump ($TRUMP) and First Lady Melania Trump ($MELANIA). These episodes underscore the volatile nature of meme-driven assets, where hype and celebrity endorsements can inflate valuations only to collapse under the weight of flawed tokenomics and insider manipulation.
As the legal and political investigations into LIBRA continue, industry experts and market watchers are calling for a comprehensive regulatory overhaul. Tighter oversight and clearer guidelines are urgently needed to protect retail investors from similar schemes in the future. The fallout from LIBRA may well serve as a catalyst for change in both the crypto market and political accountability, reshaping the landscape of digital asset endorsements worldwide.
Read more: Top 10 Crypto Scams to Avoid in the Bull Run 2025
