Argentina’s President Meets Crypto Fraud Charges

Argentine President Javier Milei is facing scrutiny as a federal judge launches an investigation into his ties with the cryptocurrency $LIBRA, following allegations of fraud. Judge María Servini has been assigned to oversee the case, which seeks to determine whether Milei engaged in unlawful activity. The controversy erupted when Milei promoted $LIBRA on social media, portraying it as a tool for economic growth. 

The endorsement briefly pushed the coin’s market cap to $4 billion before it rapidly declined, sparking concerns of a potential scam and raising the possibility of impeachment proceedings.

Some critics have raised concerns that the $LIBRA incident could be a classic case of a “rug pull” scam, where early investors inflate the value of a cryptocurrency before abruptly cashing out, leaving others with worthless tokens while profiting at the peak.

By Saturday, Milei’s office issued a statement denying direct involvement with $LIBRA, clarifying that the president was not responsible for its creation. The statement also highlighted that Milei frequently promotes business ventures, including KIP Protocol, the developer behind $LIBRA, as part of his commitment to a free-market economy.

“The president shared a post on his personal accounts announcing the launch of KIP Protocol’s project, just as he does daily with entrepreneurs looking to create jobs and attract investments in Argentina,” the statement read.

Speaking anonymously to Reuters, a government official suggested that Milei could be a victim of the cryptocurrency’s dramatic rise and fall.

Attorney Jonatan Baldiviezo, one of the plaintiffs in the case filed on Monday, told The Associated Press that he considers Milei directly accountable.

“This unlawful scheme involved fraudulent activity, and the president’s involvement was a key factor,” Baldiviezo stated.

The local NGO Observatorio del Derecho a la Ciudad, which initiated legal action, also alleged that Milei's actions caused thousands of individuals to lose money.

"We accuse Milei of being part of a criminal organization that orchestrated a scam involving the $LIBRA cryptocurrency, impacting over 40,000 people and resulting in losses exceeding $4 billion," the NGO stated on its website.

Even Hayden Davis, one of the cryptocurrency's developers, seemed to attribute its sharp decline to Milei’s actions.

"Despite prior agreements, Milei and his team abruptly reversed their stance, retracting their support and removing all related posts from social media," Davis said in a video.

Experts believe an impeachment over the controversy is unlikely, but the scandal could damage Milei’s economic credibility ahead of the 2025 midterm elections.

Milei, however, dismissed the uproar as a political attack, posting on social media late Friday:

"This only strengthens our resolve to kick them in the [a**]," he wrote.

"Milei is being accused of participating in an illicit scheme that led to the fraudulent promotion of the $LIBRA cryptocurrency, affecting more than 40,000 individuals and causing financial losses surpassing $4 billion," the NGO declared on its website.

Hayden Davis, one of the cryptocurrency creators, also appeared to hold Milei responsible for its sudden drop in value.

"Despite previous commitments, Milei and his team unexpectedly withdrew their backing, erased all related posts from social media, and shifted their position," Davis stated in a video message.

While experts consider an impeachment unlikely, they warn that the controversy could undermine Milei’s economic credibility before the 2025 midterm elections.

In response, Milei dismissed the allegations as politically motivated, writing on social media late Friday:

"This only reinforces our determination to kick them in the [a**]," he posted.

Conclusion

The controversy surrounding President Javier Milei and the $LIBRA cryptocurrency has sparked serious debate about political influence, financial responsibility, and the risks within the crypto industry. While accusations of fraud and illicit association continue to unfold, the case highlights the volatility of digital assets and the potential consequences of high-profile endorsements.

Though an impeachment seems unlikely, the scandal may impact Milei’s economic reputation and investor confidence as Argentina navigates a fragile financial landscape. Ultimately, this case serves as a cautionary tale about the intersection of politics and cryptocurrency, reminding leaders and investors of the importance of transparency and due diligence.