The LIBRA meme coin, promoted by Argentinian President Javier Milei, collapsed shortly after launch, erasing $4.4 billion in market capitalization. The project faced scrutiny due to its lack of transparency, concentrated token holdings, and insider trading activities, leading to substantial profits for selected wallet addresses. Milei distanced himself from the project after the collapse, which also triggered broader market declines in the crypto landscape.
Argentina’s LIBRA meme coin, launched on the Solana blockchain and promoted by President Javier Milei, suffered a drastic collapse just hours after its debut. This incident erased approximately $4.4 billion in market capitalization, significantly impacting the broader meme coin market.
The problems began with a social media announcement by Milei at 5:01 PM ET, which touted the token as a means to enhance the Argentine economy through small project funding. However, the project’s website, hastily prepared hours before the launch, lacked essential transparency regarding tokenomics and ownership, featuring only a Google Form for funding applications.
On-chain analysis revealed that 82% of LIBRA tokens were concentrated within a single wallet cluster, indicating potential insider trading. Data from Bubblemaps showed that insiders manipulated liquidity, extracting $87.4 million within the first three hours as the coin’s value plummeted by over 90%.
Wallet analysis by Ember CN highlighted three significant trades where individual addresses converted large sums of USDC into substantial profits, including one turning 1 million USDC into a profit of $8.58 million. This rapid collapse further influenced the overall cryptocurrency market, precipitating declines in various other tokens, including meme coins tied to former President Trump.
The launch drew 50,000 wallets in just two hours, but soon after, total market losses escalated beyond $6 billion. In the aftermath, Milei distanced himself from LIBRA, deleting his promotional post and asserting ignorance of the project’s details, framing the situation as a plot by political adversaries to damage his reputation.
Further investigations confirmed that the LIBRA team withdrew a total of $107 million, with significant holdings dispersed across eight wallets, further indicating tactical liquidity manipulation. This incident stands as one of the most rapid and substantial collapses in the meme coin sector.
The swift demise of Argentina’s LIBRA meme coin illustrates the inherent risks associated with cryptocurrency investments, particularly in projects lacking transparency and robust safeguards. This incident has highlighted the potential for insider exploitation within crypto markets, necessitating more stringent regulatory scrutiny to protect investors in the future. President Milei’s subsequent denial of any involvement underscores the need for clear communication and accountability in government-endorsed initiatives. Overall, this event marks a significant warning in the field of cryptocurrency.
Original Source: crypto.news
