According to AP, President of Argentina 8:00 Milei is facing fraud allegations after promoting a cryptocurrency called $LIBRA on social network X.
Mr. Milei said the currency is to "encourage economic growth by financing small businesses and startups". However, just hours after posting, he deleted the article, causing the value of $LIBRA to plummet, causing millions of dollars in losses to investors, according to financial site Dexscreener.
The cryptocurrency, developed by KIP Protocol and Hayden Davis, can be owned through the website vivalalibertadproject.com, a name associated with Mr. Milei's familiar slogan in his political speeches. After the post was removed, many investors expressed their dissatisfaction, causing a group of lawyers to file a lawsuit against Mr. Milei in criminal court of Argentina.
Lawyer Donald Baldiviezo, one of the plaintiffs, claimed that the case showed signs of an rug pull case a popular form of fraud in the cryptocurrency market. Accordingly, the developer launched an attractive currency to attract investment, then suddenly withdrew, causing the currency to lose its value completely. The group of lawyers also accused the President of violating the Law on Public Service ethics, taking advantage of personal influence to manipulate the financial market.
The Argentine presidential office quickly denied the allegations, asserting that Mr. Milei Was not involved in any phase of the project. In an official statement last weekend, the government said that Mr. Milei decided to remove the post to avoid unnecessary speculation following negative public reactions. The president also affirmed that he did not know much about the $LIBRA project when sharing the article on social media.
However, the incident continued to cause controversy when Hayden Mark Davis, one of the founders of KIP Protocol, criticized Mr. Milei in a video posted on social media. Mr. Davis said that the Argentine government has suddenly changed its stance, withdrawn support for $LIBRA and deleted all related posts, leading to the collapse of the currency.
Under pressure from the public, the Argentine government announced that the National Anti-Corruption Office would investigate the incident. The Government is committed to transferring all collected information to the judiciary to determine whether any individual or organization involved in the KIP Protocol project has violated the law. A judge or prosecutor is set to be appointed on February 17 to continue investigating the case.
Meanwhile, Mr. Milei denied all allegations and said that this was a political plot to reduce his prestige. The president affirmed that he did not know much about the project from the beginning, and when he realized the problem, he immediately removed the post to avoid causing further misunderstandings.
This lawsuit is attracting great attention, not only because it involves a head of state, but also because of legal risks in the cryptocurrency sector, which has witnessed many scams that have caused billions of USD in losses in the past.
