Argentine Court Dismisses Criminal Investigation Against President Milei Related to LIBRA
On October 23, Argentine Federal Judge Marcelo Martinez de Giorgi dismissed the criminal investigation against President Javier Milei and his sister, Secretary General of the Presidency Karina Milei, regarding the $LIBRA cryptocurrency scandal. This decision was made at the request of prosecutor Eduardo Taiano and also covers 9 other individuals involved, totaling 11 people.
The judge determined that the reported events did not constitute any criminal offense, particularly failing to prove the existence of "criminally relevant fraud." The case did not undergo formal summons or hearings, and the 60-page ruling noted that the transactions occurred in the highly volatile memecoin sector, where economic losses do not automatically equate to crime. The previous conclusion from the anti-corruption office was also adopted: Milei's posts on X were personal actions, not utilizing state resources or constituting official administrative actions.
On February 14, 2025, Milei promoted the $LIBRA project named Viva la Libertad Project on X, claiming it aimed to fund small businesses and startups in Argentina, sharing a smart contract address. The token price surged to about $4.55 within approximately one hour, peaking at a market cap of around $4.5 billion, before Milei deleted the post, causing the price to plummet by about 95% within hours.
On-chain analytics firm Nansen reported that 86% of traders collectively lost about $251 million, while a few profitable wallets earned approximately $180 million. Insiders withdrew over $100 million in assets from the liquidity pool, leading to the price collapse. Milei later stated he acted "in good faith," denying any association with the project and accusing political opponents of seizing the opportunity to attack.
The U.S. Department of Justice previously refused to provide relevant records to Argentina, citing insufficient evidence to prove a crime occurred. The Southern District Court of New York has also dismissed related class action lawsuits. The ruling can still be appealed and, once effective, will be archived; the opposition had planned to push for impeachment proceedings.
This incident is a typical example of event-driven speculative trading. Retail investors bought in under the president's endorsement, driving up prices, while insiders sold off and withdrew liquidity, transferring funds from retail investors to a few early holders. The beneficiaries were the project initiators and sniper wallets, while the burden fell on the majority of late investors and the political trust in Argentina.
Source: Public Information
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Javier Milei was known as a liberal economist before his election, long criticizing state intervention and advocating for dollarization, significantly cutting public spending after his election in 2023. The $LIBRA incident in February 2025 exposed his personal social media influence and direct contact with the crypto project. The New York Times previously reported multiple call records with entrepreneurs related to the project on the night of the post, and there were clues suggesting he may have received promotional fees during his tenure as a congressman, but ultimately no conviction evidence was formed.
In terms of capital flow, the project attracted funds into the Solana-based memecoin with the narrative of "supporting small businesses in Argentina," while actually achieving rapid monetization through a high proportion of internal holdings and liquidity pool operations. Initiators Hayden Mark Davis and local associate Mauricio Novelli controlled early supply, withdrawing liquidity near the price peak, converting the president's personal traffic into extractable on-chain assets rather than entering financing channels in the real economy.
Similar cases include the TRUMP and MELANIA memecoins related to former U.S. presidents, which both saw significant market cap increases through political endorsements before sharply declining, benefiting insiders while retail investors suffered. The current crypto market is at the end of a politically endorsed speculative phase, with regulatory definitions of the boundaries between "personal posts" and "official actions" becoming more lenient, and memecoin issuance shifting from anonymous teams to identifiable political affiliates.
Essentially, this represents a transfer of pricing power. The personal social media accounts of political figures have become key signal sources for short-term price discovery, capable of pushing zero liquidity assets to multi-billion dollar valuations within minutes, but this pricing power is highly fragile and unsustainable; once the endorsement is withdrawn, it quickly becomes ineffective. The mechanism lies in information advantages and liquidity asymmetries: early informants grasp the timing for withdrawal, while retail funds passively enter after public signals appear, resulting in one-way wealth transfer rather than sustainable capital allocation.
ABAB News · Cognitive Laws
Endorsement is leverage, withdrawal is settlement
Personal traffic can be priced, official responsibility cannot be pursued
Retail buys signals, insiders sell liquidity