President Javier Milei Probed Over LIBRA Scandal – Argentina’s Cryptogate Explained

Argentina's President Javier Milei is facing a federal criminal investigation concerning his promotion of the $LIBRA cryptocurrency. The scandal, which began as a social media controversy, has escalated into a significant constitutional crisis, with allegations of fraud, illicit association, and bribery. Prosecutors are examining evidence that suggests a coordinated effort involving a cryptocurrency "rug pull" that reportedly impacted over 100,000 investors.

The $5 Million Agreement and Forensic Evidence

Central to the investigation is a document recovered from the phone of crypto lobbyist Mauricio Novelli. This document, dated shortly before the $LIBRA token's launch, allegedly outlines a $5 million payment scheme tied to Milei's promotion. The agreement details tiered payments, including an upfront sum, a payment upon Milei publicly naming the token's creator Hayden Davis as an advisor, and a final payment upon signing a government consulting contract. Prosecutors believe these funds were intended for the President, his sister Karina Milei, and intermediaries.

Further forensic evidence from Argentina's DATIP unit has challenged Milei's defense. His claim of discovering the contract address online and sharing it in good faith has been contradicted by findings that the address was private and unpublished at the time of his post. Phone records indicate Milei and Novelli exchanged messages precisely when the post went live. Additionally, a draft of Milei's public apology was found on Novelli's phone, suggesting his crisis response was pre-scripted.

Karina Milei's Involvement and Legal Fallout

President Milei's sister, Karina Milei, who serves as the General Secretary of the Presidency, has become a primary target of the investigation. Evidence suggests she authorized access for Davis and Novelli to government offices multiple times. Leaked messages attributed to $LIBRA's creator, Hayden Davis, claim he controlled the President through payments made to his sister, though she denies receiving any funds. Her phone was seized in March 2025, and her bank records have been unsealed. The recovered agreement also names her as a party to the negotiations.

The legal and political ramifications are significant. Milei faces federal criminal charges in Argentina, and opposition parties are calling for his impeachment, though his party's strengthened congressional standing makes removal difficult. Internationally, a class-action lawsuit was filed in March 2025 on behalf of foreign investors. Prosecutor Eduardo Taiano has formally requested an Interpol Red Notice for Hayden Davis, who remains at large, citing his estimated $100 million in crypto proceeds as a means to evade justice.

Background on the $LIBRA Token Launch

The $LIBRA token was created on the Solana blockchain on February 14, 2025, by Kelsier Ventures. Within minutes, President Milei posted its private contract address to his large social media following, describing it as a project to "stimulate the Argentine economy." The token's market cap rapidly increased from near zero to $4.6 billion. Shortly after, developers holding approximately 70% of the supply sold their positions, causing the price to collapse by over 90%. An estimated $107 million was cashed out by developer-linked wallets, with total investor losses estimated between $251 million and $4 billion across roughly 114,000 wallets.

Current Status of the Investigation

The investigation is now focused on President Milei's knowledge of the scheme, the timing of his involvement, and any payments received. While Milei remains under investigation, his political position is currently secure from impeachment. Karina Milei's finances are under scrutiny, and Hayden Davis faces an international arrest request. Davis has claimed in a New York filing that the project was legitimate and that Milei's actions caused the crash, portraying himself as the victim.