LIBRA token crashes after $4.6B pump-and-dump, creator holds $100M

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Key Takeaways

- The launch of the LIBRA token, which was promoted by Argentina's president on social media, attracted $4.6 billion in capital.

- However, the process was plagued by insider trading and a massive sell-off of tokens, causing LIBRA’s price to plummet.

- The situation worsened after Milei publicly distanced himself from the token, accelerating its decline.

- Now at the center of the scandal, LIBRA’s creator, Hayden Davis—who was also involved in the MELANIA token—has shared his version of events and is asking what should be done with the $100 million left in his possession after the token’s launch.

Strategist, Not an Inspirer

In an interview with crypto investigator Coffeezilla, Hayden Davis described himself as the "launch strategist" rather than the project's mastermind. According to him, Javier Milei had been involved in LIBRA's creation from the very beginning, about three weeks ago. His statement was also confirmed by the Jupiter exchange.

Hayden believes that Milei’s handling of the situation—initially endorsing the project and later distancing himself from it—was the main reason for the token’s failure.

LIBRA price dynamics for 7 days. Source: CoinMarketCap

At the same time, Davis admitted that insider trading had taken place: some individuals knew about the token launch in advance and positioned themselves accordingly.

He described this as a predatory system in which experienced traders use bots to buy up large quantities of tokens within milliseconds, artificially inflating prices before dumping their holdings on unsuspecting buyers.

"Every meme coin launch is attacked by snipers. It’s inevitable," Hayden said. "A handful of elite traders figure out how to extract liquidity before the public even has a chance."

According to Davis, the sniper problem wasn’t unique to LIBRA. Other high-profile political meme coins, including Melania Trump’s token—which he was also involved in—were structured in a way that primarily benefited insiders.

What to Do with $100M?

Hayden Davis also acknowledged that he currently holds $100 million from the token launch and is waiting for further instructions from Milei’s administration on what to do with the funds.

Investors who bought $LIBRA at its peak want their money back, but Davis stated that there is no clear refund procedure. He outlined four possible options for handling the funds:

- No refunds, instead donating the money to an Argentine nonprofit organization.

- A refund process, though tracking individual losses would be complex and time-consuming.

- Reinjecting the $100 million into the market to artificially pump LIBRA’s price back to its historical high.

- A hybrid solution that distributes the funds while also maintaining market stability.

At the same time, Davis acknowledged that reinjecting money into the market could create another opportunity for insider trading. If traders knew a major buy order was coming, they could purchase the token in advance, ride the price increase, and sell at the peak—repeating the cycle of market manipulation.

"If I announce that the money is coming back, every trader with a brain will buy the dip and profit from it. That just creates another insider trading scenario," Hayden argued.

He also stated that he cannot release the funds yet, as they are his only "leverage" in negotiations with government officials. "If I give up control of the money, I lose all the power I have in this situation. I need answers from Javier’s team before I make a move," Davis said.

As we wrote, Bubblemaps analysts are “highly confident” that the Libra (LIBRA) memecoin and the Melania (MELANIA) token were launched by the same team, raising fresh concerns about market manipulation and “pump and dump” schemes.

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