TLDR
- An Argentine judge has ordered a freeze on assets linked to the LIBRA memecoin amid an ongoing fraud investigation.
- President Javier Milei’s viral post with businessman Hayden Davis triggered a $500K transfer that raised suspicions.
- Prosecutor Eduardo Taino estimated that up to $120 million may have been defrauded from LIBRA investors.
- The freeze includes assets tied to U.S. businessman Hayden Davis and crypto operators Orlando Mellino and Favio Rodriguez.
- The investigation traces millions of dollars moved from LIBRA’s liquidity pools to crypto exchanges like Bitget and Circle.
A judge in Argentina has ordered a freeze on assets related to the LIBRA memecoin. The decision follows an investigation into suspicious transactions connected to President Javier Milei’s promotion of the token earlier this year. Prosecutors believe these funds are tied to a possible fraud involving millions of dollars.
Freeze Targets LIBRA Memecoin-Related Transactions
Federal Judge Marcelo Giorgi approved a request to freeze assets linked to the LIBRA memecoin. The order includes assets connected to U.S. businessman Hayden Davis and crypto operators Orlando Mellino from Argentina and Favio Rodriguez from Colombia. The move comes after reports from Argentina’s financial investigation units.
Prosecutor Eduardo Taino supported the freeze, citing concerns about potential fraud. Investigators estimate that up to $120 million might have been defrauded from investors. The court’s order aims to prevent the suspects from hiding or moving the funds before the case concludes.
The investigation focuses on a viral post by President Milei shared on January 30. Milei posted a selfie with Davis, calling him an advisor on blockchain and AI. Just 42 minutes later, Davis transferred $507,500 through the crypto platform Bitget.
Prosecutors claim that this timing is crucial in the investigation. They traced millions of dollars flowing from LIBRA’s liquidity pools to multiple crypto exchanges. These included Bitget, Gate.io, and Circle, platforms that may have facilitated the movement of funds.
The tracking company TRM Labs found that about $90 million was moved through consolidation addresses. Analysts suggest that these addresses are closely connected to the LIBRA creator team. The funds were quickly withdrawn, sparking concerns among investors and regulators alike.
LIBRA Token Crashes After Milei’s Post
The LIBRA token launched on Solana in February, following Milei’s post. After a brief surge in value, it crashed within hours. Milei deleted the post soon after, claiming that he was unaware of the project’s details before his endorsement.
Leaked text messages between Davis and other individuals linked to LIBRA fueled further concerns. In one message, Davis allegedly claimed, “I send money to his sister and he signs what I say and does what I want. Crazy.” This exchange added weight to accusations that the LIBRA creators used Milei’s name to manipulate the market.
The legal action now focuses on preserving any assets linked to the LIBRA memecoin. Authorities hope the freeze will prevent further loss of funds and ensure that the investigation can proceed without interference.
