Argentina’s $LIBRA Coin Crash Sparks Political Firestorm
A crypto scandal is rocking Argentina after the spectacular collapse of the government-endorsed $LIBRA coin, promoted by President Javier Milei. The digital currency, hailed as a tool to modernise the Argentine economy, has lost nearly all of its value, triggering investor panic, public outrage, and mounting legal troubles for the embattled administration.
At its peak, $LIBRA was being held by more than two million Argentine citizens and had attracted over $250 million in investments, many from working-class families lured by promises of “financial revolution” and presidential endorsements.
But the dream turned sour last week, when the coin’s value crashed over 90% in under 48 hours, following revelations of insider withdrawals, flawed tokenomics, and ties to offshore shell companies allegedly linked to government advisers. Fear gripping the markets caused the token to plummet, wiping out savings and exposing what critics are referring to as a "state-sponsored rug pull".
The backlash has been immediate. Over 100 criminal complaints have been filed across federal courts, while opposition parties are rallying behind a motion to impeach President Milei for gross misconduct and abuse of power.
“This isn’t just a crypto crash. This is theft at a national level,” said Congresswoman Lucia Fernandez, leader of the opposition Civic Union. “The president used his platform and trust to peddle a worthless token, enriching a circle of insiders while ordinary Argentines lost everything.”
President Milei, known for his libertarian zeal and pro-crypto stance, denies direct involvement. In a televised statement, he claimed the project was “community led” and that any association between him and $LIBRA was “taken out of context”.
“I never held a position in the foundation behind $LIBRA,” he said. “Argentina must be free to experiment with financial technology, even if it comes with risk.”
But leaked emails and audio recordings now circulating on local media suggest that senior members of Milei’s cabinet were not only briefed on the token launch but may have facilitated key partnerships with payment providers and exchanges. One voice memo allegedly features a top adviser calling the project “the most elegant way to wipe our deficit.”.
The National Securities Commission (CNV) has since frozen all trading in $LIBRA and launched a formal investigation into its founders. International watchdogs, including the Financial Action Task Force (FATF), have also expressed concern over the implications of a sovereign leader backing an unregulated digital asset.
The scandal has ignited protests outside government buildings in Buenos Aires, with demonstrators demanding resignations and restitution. Handwritten signs read, “No más estafas criptos” “No more crypto scams” a phrase now trending across Argentine social media.
As the legal fallout unfolds, the $LIBRA debacle is quickly becoming a case study in the dangers of political entanglement with digital assets. It also serves as a warning to leaders worldwide, emphasising that when crypto goes wrong, the backlash can be not just financial but also existential.