Approximately $99 million worth of cryptocurrency linked to the controversial crypto token $LIBRA was withdrawn from its marketplace by eight digital wallets connected to the coin’s creator, blockchain researchers at Chainalysis reported.
The scandal erupted after Argentinian President Javier Milei promoted the little-known crypto coin in a post on X late Friday, causing its value to skyrocket above $4.50 before crashing within hours. Milei later deleted the post, denied any ties to the cryptocurrency, and accused political rivals of exploiting the situation. A federal judge is now investigating the coin’s launch and Milei’s potential involvement.
Suspicious Withdrawals and Creator Links
Chainalysis, a blockchain analytics firm, stated that the wallets that withdrew the funds had received tokens directly from the coin’s creator. “The on-chain behavior suggests that these addresses are closely related to the Libra creator team,” Chainalysis told Reuters. However, the firm did not disclose the exact timing of the withdrawals.
The withdrawn funds included the stablecoin USDC and SOL (Solana) cryptocurrency, with their dollar value fluctuating depending on token prices. Another analytics firm, Nansen, noted that the wallets still hold a combined value of about $87 million, suggesting that those linked to the Libra launch still possess significant assets.
A Failed Plan, Not a Scam?
The crypto coin was launched on the exchange platform Meteora, which could not be reached for comment. From Sunday to Tuesday, 70% of wallets trading $LIBRA suffered losses, Nansen reported.
Hayden Davis, who previously identified himself as the CEO of Kelsier Ventures, acknowledged in a statement on X that he acted as a “launch advisor” for $LIBRA and controlled up to $100 million from the token’s marketplace. Davis denied any intention of personal gain, stating, “I have not, nor will I, take any of these funds for my personal benefit” and pledged to reinvest the money into the token.
In an interview with crypto YouTuber Stephen Findeisen, known as “Coffeezilla”, Davis insisted that $LIBRA was not a “rug-pull” scam — a scheme where developers inflate a coin’s value before abruptly withdrawing their assets, leaving investors with worthless tokens. “It’s not a rug. It’s a plan gone miserably wrong with $100 million sitting in an account that I’m the custodian of,” Davis said.
Despite Davis’ claims, the incident has fueled skepticism in Argentina, where crypto investments are increasingly popular amid economic instability. The outcome of the federal investigation could have significant implications for both the cryptocurrency market and Milei’s presidency.
