Javier Milei's Controversial Endorsement of $Libra Cryptocurrency: Fraud or Misstep?

Argentina experienced a dramatic evening when President Javier Milei took to social media to promote a cryptocurrency called $Libra. Initially, the posts were met with amusement, as many speculated that his accounts on X and Instagram had been hacked. However, the situation quickly turned to bewilderment as no official clarification emerged regarding his involvement.

"Liberal Argentina continues to grow!!! The goal of this private project is to assist in the development of the Argentina economy, financing small companies and local ventures. The world wants to invest in Argentina," read the tweet posted around 7 p.m. local time.

Following the post, the price of $Libra tokens skyrocketed to US$4.97 with a market cap of US$4.5 billion. This surge was short-lived, as many digital wallets began to cash out, causing the price to crash to US$0.99.

By 1 a.m., Milei confirmed his endorsement but claimed ignorance about the project, stating he had no ties to it and criticized political opponents for seizing the moment to attack him.

Clear Signs of Fraud

Unlike established cryptocurrencies like Bitcoin or Ethereum, which boast decentralized networks and security measures, $Libra is merely a token on the Solana blockchain with no backing or stability. Experts have raised concerns that it might be a manipulation scheme. Cybersecurity expert Pablo Sabattella highlighted that the domain registration and contact details appeared suspicious, marking it as a potential scam.

Sources from cryptocurrency platforms indicated that the project has fraudulent characteristics, including the concentration of tokens, where 80% are held by just three wallets, suggesting a rug pull scenario. In this scheme, developers attract investments with high returns and then disappear with the funds.

The political opposition has reacted strongly, with Socialist deputy Esteban Paulón planning to summon Chief of Staff Guillermo Francos to explain Milei's actions and pursuing impeachment proceedings. Senator Martín Lousteau pointed out this was not the first instance of Milei promoting a dubious cryptocurrency, questioning whether he would face penalties for his actions.

With information from Ámbito