Argentina’s President Javier Milei has ordered an official investigation into the $LIBRA cryptocurrency after his endorsement of the token led to a dramatic loss in value, sparking allegations of a scam.
On Friday night, Milei promoted $LIBRA through his X (formerly Twitter) account, claiming the cryptocurrency would boost Argentina’s economy and support local businesses. This endorsement caused the token’s price to surge briefly to $5 before it collapsed by nearly 90%, dropping below $1. The sudden crash wiped out more than $4.4 billion in market value, fueling speculation of fraudulent activity surrounding the token.
In the wake of the collapse, Milei deleted his post and clarified his stance. He explained on X, “A few hours ago, I posted a tweet, as I have so many other times, supporting a supposed private enterprise with which I obviously have no connection whatsoever. I was not aware of the details of the project, and after becoming aware of it, I decided not to continue promoting it (that’s why I deleted the tweet).”
Despite his attempt to distance himself from the project, the damage had already been done. The $LIBRA token’s sudden crash has sparked widespread outrage online.
In response to the growing controversy, President Milei has launched an investigation into the token’s promotion and its potential ties to government officials. On February 16, the President’s office released a statement clarifying that the initial promotion was intended as a regular business endorsement aimed at creating jobs, attracting investments, and fostering economic welfare. The statement emphasized that the project was not officially linked to the President.
The President has directed the Anti-Corruption Office (OA) to probe whether any government members, including himself, were involved in the $LIBRA scam or its launch. Additionally, Milei announced the formation of an Investigation Task Unit (UTI), which will operate under his direct supervision. This team will include experts in cryptocurrency, financial transactions, and anti-money laundering, and will investigate all individuals and companies connected to the token, including the KIP protocol.
In response to the allegations, KIP protocol has denied any involvement in the cryptocurrency’s launch. The company stated that the creation and release of the $LIBRA token were solely managed by Kelsier Ventures, led by its initiator, Hayden Davis.
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