A massive crisis is unfolding for Argentina’s President Javier Milei as his involvement in a crypto scandal has triggered severe consequences both domestically and internationally. What started as a promising investment suggestion for the LIBRA cryptocurrency has turned into a nightmare for Milei, who now faces criminal lawsuits, a plummeting stock market, and an FBI investigation.

Market Chaos and Legal Troubles

The fallout began late on Friday, February 14, 2025, when Milei recommended the LIBRA cryptocurrency to his followers. This advice, given on the evening of Valentine’s Day, quickly spiraled into a scandal. As markets opened on Monday, the Merval, Buenos Aires’ stock exchange index, dropped by 3.5%, reflecting investor panic and loss of confidence in Milei’s leadership.

Financial analyst Ignacio Morales pointed out that this is the “biggest reputational crisis” of Milei’s presidency. As the Argentine stock market reacted, the focus shifted to the upcoming Tuesday when U.S. markets would reopen. Investors are watching closely to see how the crisis will impact Argentine companies listed on Wall Street.

Fallout for Milei’s Image

For Milei, the scandal is a massive blow to his credibility as an economist and political figure. Known for his repeated self-nominations for the Nobel Prize in Economics, Milei’s endorsement of a questionable memecoin like LIBRA has caused outrage among both his supporters and the broader public. His once-untouchable reputation is now in tatters.

Adding fuel to the fire, reports suggest that Milei’s sister, Karina Milei, who serves as the Secretary-General of the Presidency, may have played a role in promoting the coin on social media. This has further fueled the controversy, leading to criminal lawsuits piling up in Argentine courts.

Criminal Lawsuits and FBI Involvement

As of now, over 100 criminal complaints have been filed against President Milei, with lawyers accusing him of promoting an illicit scheme. A prominent Argentine law firm has submitted a criminal complaint regarding illegal profits of between $80 million and $100 million tied to the LIBRA token.

Lawyer Mariano Moyano Rodríguez, representing a group of Argentine and U.S. investors, has formally requested the U.S. Department of Justice to investigate Milei’s role in the crypto scam. Moyano stated that Milei not only promoted LIBRA but has been linked to other dubious ventures in the past.

The Scale of the Scandal

Data analysis by Fernando Molina, a data engineer, has shed light on the extent of the financial losses. Of those who invested in LIBRA, 62% lost between $1 and $1,000, while 21% made similar gains. However, nearly 9% of investors lost between $1,000 and $10,000, and 2.7% saw losses between $10,000 and $100,000. Only 0.8% of investors profited from the token, but they made substantial returns.

Interestingly, Molina’s analysis uncovered suspicious activity in one wallet that seemed to have insider knowledge. This wallet made four simultaneous purchases of $250,000 each, right as Milei posted the tweet about LIBRA. The purchases were likely executed by a bot, a “sniper” who knew exactly when to buy and sell. The wallet’s owner sold when the price hit nearly $4 per token, making a profit of $8.5 million.

The FBI Joins the Investigation

As the scandal deepens, it has drawn the attention of international authorities, including the FBI. The U.S. Securities and Exchange Commission (SEC) is also looking into the situation, raising the stakes for Milei and his government. The scandal threatens not only Milei’s political future but also Argentina’s economic standing on the world stage.

What’s Next for Milei?

The next few days will be crucial as more legal actions unfold and the stock market continues to react. Investors and analysts are waiting to see how the situation will resolve, and whether Milei can survive the mounting pressure. One thing is certain: the LIBRA scandal has already become one of the most significant political and financial crises in Argentina’s recent history.

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