A crypto scandal continues to rock Argentina as blockchain researchers found that digital assets worth about $99m were withdrawn from the controversial Libra token’s liquidity pool.
Eight wallets linked to the token’s creator withdrew the funds, Reuters reported Thursday, citing Chainalysis. This has raised further concerns about the coin’s legitimacy and Argentina’s President, Javier Milei’s involvement.
The controversy began late Friday when Milei endorsed the little-known $LIBRA token in an X post. His endorsement triggered a frenzy. Subsequently, the token’s price surged above $4.50 before crashing just hours later.
However, Milei quickly deleted the post and distanced himself from the token. Further, he claimed he had no ties to its creators. He did admit to meeting the team behind Libra. However, he insisted that his post was not meant as investment advice.
The token’s sudden market collapse prompted a federal investigation into the token’s launch and Milei’s potential involvement. Meanwhile, the president has accused political rivals of exploiting the situation for their gain.
Crypto Watchdogs Spot Massive Token Withdrawals from Insider-Linked Wallets
Chainalysis told Reuters that eight crypto wallets withdrew a significant sum from Libra’s liquidity pool.
The identities of the wallet owners remain unconfirmed. However, Chainalysis noted that these addresses received tokens directly from the Libra creator.
“The on-chain behavior suggests that these addresses are closely related to the Libra creator team based on the fact that those addresses were funded directly from the Libra token creator,” Chainalysis said, though it did not specify when the funds were withdrawn.
The withdrawn tokens reportedly included USDC and SOL.
Meteora Co-Founder Resigns as Libra Controversy Deepens
The token was initially listed on the crypto exchange Meteora, whose co-founder, Ben Chow, has since stepped down following the growing controversy surrounding Libra.
Meanwhile, Nansen reported that 86% of traders, or 15,430 wallets, sold at a loss, totaling $251m in realized losses, as of Thursday.
Meme coins, such as $LIBRA, often gain rapid value before crashing as early investors cash out. While these speculative tokens have been a staple in the crypto industry, direct political involvement is uncommon. However, this incident follows a surprising precedent—former US President Donald Trump and his wife launched their own meme coins just last month.
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