Crypto

Argentina’s President Faces Lawsuit Over LIBRA Crypto Crash

5 days ago
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  • Argentine President Javier Milei faces a lawsuit for promoting LIBRA.
  • Milei’s office denied his involvement in LIBRA’s development and stated that he only shared the project like other business initiatives.

Argentine lawyers have filed a legal action against President Javier Milei over fraud, having claimed in his promotion of the cryptocurrency known as LIBRA. The token rose and then fell greatly, causing massive losses during the initial investment made by investors.

One of the plaintiffs, lawyer Jonatan Baldiviezo, said that the lawsuit had been filed before the criminal court. He accused Milei of contributing to giving wrong information and encouraging people to invest in LIBRA by posting about the token on social network X and then deleting the message, which negatively affected its price.

Baldiviezo said that the case was a conspiracy to commit fraud, claiming an organization of an unlawful purpose. According to him, one of the most critical factors that contributed to the legitimization of the cryptocurrency prior to its crash was the president’s endorsement.

Additionally, Agustín Rombolá, the founder of the Rombolá Mangione law firm, sued Milei for fraud and other financial misdeeds. He also said he would seek a class-action suit on behalf of the investors who lost their money in the fraud. The judge will have to consider the case or send it further to the prosecutors for further consideration. 

Presidential Office Denies Direct Involvement

As reported by CNF, the Office of the President of Argentina (OPR) dismissed allegations, stating that the president, Milei had nothing to do with the creation of the LIBRA token. According to the OPR, Milei discuss with representatives of KIP Protocol, the company that operates LIBRA, and was merely told their intention of using blockchain to fund small-claims businesses in Argentina.

The OPR said Milei’s promotional posts and support for other business ventures were unremarkable. The office said he deleted the post just to prevent further speculation and clarified that he was not involved in creating and funding the token.

Milei has since established an Investigation Task Unit (UTI) to determine if KIP Protocol or related LIBRA individuals committed any crimes. The OPR asserted that the government does not have any financial stake in the project.

LIBRA Token’s Price Surge and Collapse

LIBRA was launched as part of the Viva La Libertad Project aiming to provide funds to Argentina’s economy through supporting SMEs. Milei’s contribution to the token led to an increase from $0.0001 to $0.003137 and an all-time high of $4.5. In just a few hours, its fully diluted market capitalization was over $4 billion.

However, the price fell by 90% after it emerged that insiders held 82% of the tokens. According to the blockchain analytics firm Lookonchain, the LIBRA team withdrew $107 million based on liquidity manipulation, which is highly likely to be a pump-and-dump fraud.

However, KIP Network’s founder, Julian Peh, defended that LIBRA was not a scam and had significant backing. On the other hand, Hayden Mark Davis, who had been involved in the project, accused Milei of causing the mishap, saying that the president had done a U-turn, thus creating havoc among the investors.

Milei’s involvement with LIBRA has been compared to his alleged endorsement of CoinX, a scam that led to the loss of investors’ cash. This is reminiscent of similar collapses, such as the MELANIA and TRUMP meme coins, which faced highly unstable trends once they trended online. The LIBRA token is now trading at $0.375.

Source: https://www.crypto-news-flash.com/argentina-president-faces-lawsuit-libra/?utm_source=rss&utm_medium=rss&utm_campaign=argentina-president-faces-lawsuit-libra