Memecoin Scandal Threatens Argentine President Javier Milei

Argentina’s president, Javier Milei, has come under fire for the abrupt collapse of a cryptocurrency he promoted, in a move that has triggered lawsuits and calls for his impeachment.

Milei is facing more than 100 complaints against him at the country’s supreme court, accusing him of participating in an alleged scam related to the cryptocurrency $Libra, which opposition politicians estimate has resulted in financial losses for 40,000 people.

On February 14, the Argentine leader posted a message on his X account, which has 3.8 million followers: “Liberal Argentina grows! This private project will be dedicated to encourage the growth of Argentina’s economy, funding small Argentine companies and ventures. The world wants to invest in Argentina. $Libra,” he wrote.

In a matter of minutes, $Libra went from being worth fractions of a cent to $4.97 per unit. But unfortunately for investors, this hike was short-lived. Within hours it plummeted to $0.19.

Now, prosecutors will determine if there are sufficient elements to move forward with a criminal investigation against the president and other possible suspects.

Milei is accused of helping to inflate the price of the currency by promoting it on X, then withdrawing his support causing the cryptocurrency to collapse.

Former Argentinian president Cristina Kirchner claimed that Milei was a “crypto fraudster” in a lengthy post on X in which she also accused him of turning the country into a casino in which he was the croupier.

“The president has to come to congress. He cannot investigate himself,” said politician Esteban Paulon, a member of the opposing socialist party, in a message on X calling for Milei’s impeachment.

Milei has since distanced himself from this collapse, claiming he did not benefit from the memecoin.

“A few hours ago I posted a tweet, as I have done countless times before, about private initiatives that seek to contribute to the development of our country. I have no relationship with the company that created this cryptocurrency nor have I received any benefit.” In a statement on X, the official account for the office of the Argentinian president posted, “Given the facts, President Javier Milei has decided to immediately involve the Anti-Corruption Office (OA) to determine whether there was improper conduct on the part of any member of the National Government, including the President himself.”

Entrepreneur Hayden Mark Davis, one of the creators of the cryptocurrency $Libra, also blamed Milei for the collapse.

“His team had secured his public support at launch and assured me that his support would continue throughout the process,” the American investor said in a statement released by his firm, Kelsier Ventures. “Despite prior commitments, Milei and his team unexpectedly reversed their position, withdrawing their support and removing all previous endorsements on social media,” Davis claimed, indicating that this setback would have triggered panic selling of the token.

“It is critical to recognize that memecoin investments are driven by trust and endorsement. When Milei and his team removed their posts, investors who had purchased the token, basing their trust on that endorsement, felt betrayed.”