Argentina's president launches his own memecoin, then backs out of it
Argentina’s President Milei retracts support for LIBRA memecoin, denying any connection.
Argentina’s President Javier Milei has retracted his endorsement of the LIBRA memecoin, stating that he has no connection with the project.
After LIBRA briefly reached a market cap of roughly $4.5 billion, its price crashed by 89% within hours, triggering widespread alarm among investors.
LIBRA price chart. Source: dxscreener.com
Key Takeaways
- Presidential Disavowal: President Milei publicly distanced himself from LIBRA after failing to research the token thoroughly, undermining its legitimacy.
- Market Volatility: LIBRA’s price plunged from an initial high of $4.50 to $0.50, reflecting an abrupt loss of investor confidence.
- On-Chain Red Flags: Blockchain analytics revealed that critical aspects of LIBRA’s supply are controlled by single-key addresses, and developers have already offloaded about $87 million in tokens.
- Legitimacy Concerns: Experts warn that the token’s insecure distribution model may point to a potential pump-and-dump scheme.
Presidential Disavowal and Market Turbulence
President Javier Milei, who once promoted LIBRA on his social media as a tool to stimulate Argentina’s economy by funding small businesses, has now disassociated himself from the project. Admitting that he did not invest enough time to research the token, Milei unfollowed LIBRA’s Twitter account, fueling skepticism about its credibility.
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The initial hype drove LIBRA’s market cap to around $4.5 billion, but as concerns mounted regarding its authenticity, traders began selling en masse, resulting in an 89% drop in value.
On-Chain Red Flags and Developer Activity
Blockchain analytics firms like Chainalysis and Bubblemaps have raised serious concerns over LIBRA’s framework. They found that both the token creation and a substantial portion of its supply are managed through single-key addresses rather than secure multi-signature wallets.
Furthermore, on-chain data suggests that the LIBRA team has already withdrawn approximately $87 million from liquidity pools, adding to the doubts about the project’s legitimacy.
Conclusion and Outlook
The dramatic reversal of support by President Milei, combined with LIBRA’s precipitous price crash and alarming on-chain signals, has intensified investor concerns over the token’s legitimacy. Experts predict that without robust security measures and transparent governance, LIBRA and similar projects may continue to suffer from extreme volatility and potential regulatory scrutiny.
Recently we wrote, that memecoins are poised to become a key indicator of political sentiment, according to Arthur Hayes, the former CEO of BitMEX.
