Argentina’s President Javier Milei Under Investigation for Promoting Cryptocurrency that Crashed
BUENOS AIRES: Argentine prosecutors will investigate President Javier Milei for promoting a cryptocurrency that crashed, losing investors billions of dollars and prompting a flood of complaints, local media reported Monday.
The Investigation
The federal prosecutor’s office will examine whether Milei engaged in fraud or criminal association or was in breach of his duties when he praised the $LIBRA cryptocurrency on social media on Friday evening, according to news reports. The currency’s value soared then crashed, and Milei deleted his blessing hours later, saying he had made a mistake.
Criticism and Scam Allegations
Argentine economists, crypto specialists, and opposition political figures criticized the self-declared "anarcho-capitalist" president, an economist by training, and said the digital asset could be a fraud or a Ponzi scheme. Industry observers said the operation was likely a "rug pull" – a scam where developers unveil a crypto token, attract investors, then quickly cash out.
Losses and Complaints
Rights NGO Observatory for the Right to the City, one of several complainants, alleges Milei formed part of a "criminal organisation that organised a fraud with the $LIBRA cryptocurrency that simultaneously affected more than 40,000 people with losses of more than US$4 billion."
Government Response
The presidency on Saturday announced that Argentina’s anti-corruption office would be tasked with determining whether any improper conduct occurred. It would also create a task force to carry out an "urgent investigation into the launch of the cryptocurrency $LIBRA, and all companies or individuals involved." The prosecutor’s office will also look into Julian Peh – the CEO of companies that participated in the creation of $LIBRA – as well as chamber of deputies president Martin Menem, who had reposted Milei’s original endorsement.
Impact on Milei’s Credibility
Political scientist Carlos Germano told AFP that the case "affects his (Milei’s) credibility" though his efforts to combat inflation – at its lowest in four years – remain popular with the electorate. Milei continued with his duties Monday, hosting Republican US senator Steve Daines in Buenos Aires. The president is due to visit the US later this week.
Conclusion
The investigation into President Javier Milei’s promotion of the $LIBRA cryptocurrency has raised concerns about his credibility and the potential for fraud. As the investigation unfolds, it remains to be seen whether Milei will face consequences for his actions.
FAQs
- What is the $LIBRA cryptocurrency?
- The $LIBRA cryptocurrency is a digital asset that was launched recently and quickly gained popularity, but its value crashed soon after.
- What is the investigation about?
- The investigation is into whether President Javier Milei engaged in fraud or criminal association or was in breach of his duties by promoting the $LIBRA cryptocurrency.
- How many people were affected?
- More than 40,000 people were affected by the crash of the $LIBRA cryptocurrency, resulting in losses of over US$4 billion.
- What is the current status of the investigation?
- The investigation is ongoing, and the prosecutor’s office is examining the facts and circumstances surrounding the launch and promotion of the $LIBRA cryptocurrency.