Argentina’s President Javier Milei faces backlash after his promotion of the LIBRA cryptocurrency led to massive financial losses and legal complaints. Additionally, a major hack on the Bybit exchange resulted in a $1.5 billion theft. Meanwhile, regulatory shifts are seen with Coinbase and Figure obtaining key approvals, reflecting the ongoing tumult in the crypto market.
Argentina is currently embroiled in a major crypto controversy involving President Javier Milei. Following a promotion on social media for a little-known token called LIBRA, which he claimed would benefit Argentina’s economy, the token’s value rapidly rose before plummeting, leading to widespread financial losses. The situation has resulted in over 100 fraud complaints filed against Milei, prompting a judicial investigation into the matter.
On February 14, Milei used social media to promote LIBRA, urging his followers to invest, which led to a rapid increase in the token’s market price. However, this quick rise was short-lived, as the value dropped significantly within hours. Critics have accused Milei of negligence, asserting that he may have misled investors about the potential benefits of the digital currency, necessitating legal scrutiny.
Hayden Davis, a crypto entrepreneur implicated in the LIBRA launch, revealed tactics such as ‘sniping’, where insiders purchase tokens at low prices to profit from subsequent inflated values. He indicated that around $100 million was generated from this scheme. While he downplayed Milei’s involvement, he described the event as an ‘experiment’ gone awry and confirmed the existence of a refund of $5 million to Barstool Sports’ Dave Portnoy for losses incurred.
The financial fallout from the LIBRA incident reveals that 86% of traders involved lost money, totalling approximately $251 million in losses. Some participants reportedly made gains, while others, including prominent figures linked to the launch, have since stepped down from their posts amid the scandal. Consequently, Ben Chow, cofounder of the exchange facilitating LIBRA’s launch, announced his resignation as public scrutiny intensified.
Additionally, Bybit, a Dubai-based crypto exchange, suffered its largest theft to date, losing $1.5 billion due to a hack involving one of its cold wallets. Experts suggest North Korean hackers were involved in this breach, transferring stolen assets across multiple platforms immediately. Despite the magnitude of this loss, Bybit’s CEO confirmed that client assets remain secure and the exchange is solvent, ensuring users will not be adversely affected.
In the broader crypto landscape, Coinbase is reportedly approaching a resolution with the SEC regarding its legal challenges. Simultaneously, some investors are set to receive reimbursements from the FTX collapse, while Figure obtains SEC approval for their inaugural interest-bearing stablecoin launch, indicating ongoing developments in regulatory compliance and market recovery.
The crypto landscape in Argentina is currently under scrutiny following President Javier Milei’s controversial LIBRA token promotion, resulting in significant monetary losses for investors and legal scrutiny. This incident, coupled with the largest ever crypto theft from Bybit, underscores the volatility and risks present within the cryptocurrency markets. Ongoing regulatory developments in the sector, such as Coinbase’s potential settlement with the SEC and an approved stablecoin by Figure, suggest evolving dynamics that impact investor confidence and market stability.
Original Source: www.forbes.com
