Argentine President Javier Milei is facing legal and political challenges after his involvement in promoting the ill-fated crypto project Libra (LIBRA).
The controversy began when Milei directed his extensive social media audience to the token, causing its value to surge before a rapid decline led to significant investor losses.
The incident has sparked lawsuits, an internal government probe, and calls for impeachment.
Milei’s Response to the Libra Incident
Per a Bloomberg report, Milei acknowledged meeting with the creators of the Solana-based Libra token and expressed his intent to support Argentine businesses using crypto.
He stated that his social media post was not meant to persuade users to buy the token but to highlight an initiative aimed at financing local entrepreneurs.
Meanwhile, his endorsement caused the token’s price to multiply fourfold, briefly reaching a total valuation of $4 billion before plummeting.
In his first public defense of the Libra token scandal, Milei denied any malfeasance. He claimed he merely aimed to raise awareness about a tool to finance entrepreneurs.
Nonetheless, Milei admitted he needed to impose stricter filters on those seeking meetings with him. His statement came after the Argentine government launched an internal investigation into the matter.
Economy Minister Luis Caputo downplayed the incident, calling it an unforced error and stating that Milei had no criminal intent. He also emphasized that the crypto sector is highly specialized and difficult to comprehend.
Political and Market Reactions
The fallout from the controversy extended beyond politics. Argentina’s S&P Merval Index suffered its steepest decline since July, dropping 5.6% on Monday.
Investors in Buenos Aires pulled back from major local companies, signaling broader market concerns. While U.S. bond and equity markets were closed at the time, the government sought to shift focus by highlighting the country’s recent budget surplus.
Notably, legal actions against Milei are mounting. An Argentine judge is handling over 100 lawsuits filed in response to the incident. Law firms, including Moyano & Asociados, have lodged complaints with the U.S. Securities and Exchange Commission.
Meanwhile, Hayden Davis, CEO of Kelsier Ventures, which helped launch Libra, stated that Milei may not have been fully aware of the situation.
Opposition leaders have intensified impeachment efforts, but securing a two-thirds majority in Congress remains unlikely. Meanwhile, Milei is preparing to visit Washington in pursuit of financial assistance and tariff exemptions from the U.S. government.
Libra Surge Amid Renewed Promotion
Despite the controversy, Milei reposted a tutorial on how to buy Libra on February 17, contradicting his earlier decision to remove the content. His action led to a 60% surge in the token’s value.
Argentine President Javier Millei reposted the LIBRA token purchase tutorial on the social platform X. Although Millei had previously stated that he would no longer spread the LIBRA message and deleted the tweet. The opposition is pursuing an impeachment effort against Millei.… pic.twitter.com/kEqEgVSctH
— Wu Blockchain (@WuBlockchain) February 17, 2025
At the time of reporting, Libra was trading at $0.3514, reflecting a 12.95% increase in the past 24 hours.
DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
