$LIBRA Scandal: Blockchain Firms Trace $99M Withdrawals as Advisor Denies Rug-Pull

Around $99 million worth of cryptocurrency was withdrawn from the marketplace of $LIBRA, a token at the center of a scandal in Argentina, by eight digital wallets linked to its creator, as reported by Reuters.

Argentinian President Javier Milei endorsed the little-known cryptocurrency in a post on X late Friday, only to delete it later and deny any connection to the project. A federal judge is now investigating the token's launch and Milei’s potential involvement after its price surged past $4.50 following his post, only to crash within hours. Milei has accused his political rivals of exploiting the situation.

Blockchain analytics firm Chainalysis reported that eight wallets withdrew approximately $99 million worth of tokens from $LIBRA’s liquidity pool—a marketplace where traders buy and sell crypto. While the firm could not confirm the identities of the wallet owners, they noted that these addresses had received tokens directly from the $LIBRA creator. “The on-chain behavior suggests that these addresses are closely related to the Libra creator team based on the fact that those addresses were funded directly from the Libra token creator," Chainalysis told Reuters. The firm did not specify when the withdrawals took place.

Meme coins—cryptocurrencies named after internet trends or jokes—are known for rapid price spikes followed by crashes as early investors cash out. While such coins are common in the crypto world, political figures rarely get involved. However, in a surprising move, former U.S. President Donald Trump and his wife launched their own meme coin last month.

The withdrawn funds consisted of the stablecoin USDC and Solana (SOL), Chainalysis said, adding that the total dollar value of the holdings fluctuates with market prices. Another analytics firm, Nansen, estimated that wallets linked to $LIBRA’s launch still hold a combined value of around $87 million. “It is fair to say that there is still a lot of money in the hands of those related to the Libra launch," Nansen told Reuters.

The token was launched on the crypto exchange Meteora, which has not responded to requests for comment. From Sunday to Tuesday, 70% of wallets trading $LIBRA recorded losses, according to Nansen.

$LIBRA Advisor Calls Token Collapse "A Plan Gone Wrong"

Hayden Davis, whose now-deleted LinkedIn page listed him as CEO of the crypto company Kelsier Ventures, described himself as a “launch advisor” for $LIBRA in a statement posted Sunday on the company’s X account. Davis claimed he currently holds up to $100 million from the token’s marketplace, though he did not clarify how or why he acquired the funds. He insisted he intends to reinvest the money back into $LIBRA, stating, “I want to make it unequivocally clear that I have not, nor will I, take any of these funds for my personal benefit.”

In an interview with crypto YouTuber Stephen Findeisen, known as "Coffeezilla," Davis denied allegations of a rug-pull—a type of scam where creators drive up a token’s value before cashing out and abandoning investors. Instead, he described the situation as a botched effort to stabilize the coin. “It’s not a rug. It’s a plan gone miserably wrong with $100 million sitting in an account that I’m the custodian of,” Davis said.