Argentina’s House of Representatives has launched a probe into the LIBRA memecoin scandal. This crypto project collapsed shortly after President Javier Milei promoted it on social media, resulting in significant financial losses for investors. The investigation aims to uncover potential misconduct and clarify the government’s involvement.
The LIBRA Scandal Unfolds
The controversy began in February when President Milei shared a post on his official X account, describing LIBRA as a private project dedicated to encouraging the growth of Argentina’s economy by funding small businesses and startups. The post sparked a surge in the token’s value, reaching a market capitalization of over $4.5 billion.
However, within hours, the token’s value decreased by over 90% after insiders allegedly sold their holdings, resulting in losses estimated at up to $4 billion in market capitalization almost overnight. Milei later deleted the post, claiming he had only shared the information and not endorsed the project. His administration referred the case to the Anti-Corruption Office for review.
Critics accused him of promoting what they described as a scam, dubbing the incident “Cryptogate.” Over 100 criminal complaints were filed, alleging fraud, market manipulation, and breaches of public trust.
Libra Case Investigation in Motion
The House of Representatives voted to launch the investigation with 128 votes in favor, 93 against, and seven abstentions. The commission plans to summon key figures from Milei’s administration, including Economy Minister Luis Caputo and Justice Minister Mariano Cúneo Libarona, to testify. The probe will examine potential misconduct surrounding the token’s launch and collapse.
Lawmakers argue that the inquiry is necessary to protect the public and ensure that virtual venture is not used to deceive or exploit individuals. Representative Pablo Juliano emphasized Congress’s commitment to uncovering the truth, while Nicolás Mayoraz from the ruling La Libertad Avanza party called the probe an “interference” and argued that it disrespects the separation of powers.
The investigation raises broader questions about the risks of political figures engaging with unregulated digital assets in Argentina, a country already struggling with high inflation and economic instability.
Meanwhile, other regulatory bodies have also investigated the LIBRA case and taken separate legal actions against some major actors linked to it. For example, Burwick Law, a prominent US law firm, filed a lawsuit against Kelsier, KIP, and Meteora, key players in the matter, alleging unfair token practices connected to the embattled LIBRA token. The lawsuit claims that the defendants led a misleading token launch, harming retail investors and leaving a trail of financial devastation in its wake.
