$LIBRA Rug Pull Sparks Controversy
The $LIBRA rug pull case has caused waves across the crypto community and beyond. The controversy stems from its association with Argentina’s President, Javier Milei. Promoted as a token that would contribute to Argentina’s economic growth, $LIBRA has instead become one of the most significant rug pull cases in recent memory.
The $LIBRA token launched on February 14, 2025, with heavy promotion from President Javier Milei through a post on X (formerly Twitter). The token quickly gained traction, reaching a market cap of $4.56 billion. Investors flocked in, enticed by claims that the token would fund local businesses and boost the nation’s economy. Within hours, the token experienced a catastrophic collapse. Its value dropped by 95%, wiping out nearly $4 billion in market cap. Blockchain data revealed that insiders cashed out over $107 million in liquidity during the crash, leaving investors to absorb the losses.
Source: stablemark
Investigative tools like Bubble Maps discovered that 82% of the $LIBRA supply was concentrated in a single cluster. This raised suspicions about the token’s legitimacy. Transparency in crypto projects is essential, and the lack of it in $LIBRA’s case only fueled concerns about malicious intent.
President Milei’s Response
After the token’s collapse, President Milei deleted his promotional post and issued a statement distancing himself from the project. He claimed he had no direct involvement and no prior knowledge of the token’s details. However, the timing of his promotion and subsequent withdrawal has led to widespread criticism. Opposition lawmakers have demanded his impeachment, arguing that his endorsement contributed to the financial losses investors faced.
Source: CNN
The incident has escalated into a political crisis. Opposition parties have used the event to question President Milei’s judgment and credibility. The Argentine Fintech Chamber acknowledged the event as a potential rug pull, calling it an international embarrassment.
Involvement of KIP Protocol and Other Entities
KIP Protocol, linked to the project, has faced intense scrutiny. The CEO of KIP Protocol denied involvement in $LIBRA’s launch but admitted guilty to fraud worth nearly $100 million. In an unusual move, the CEO proposed buying back the token’s entire supply for $100 million, claiming to seek solutions for affected investors. Critics labeled this as another pump-and-dump scheme, benefiting insiders once again. Investigations have also connected KIP Protocol to other suspicious projects, further tarnishing its reputation.
The $LIBRA rug pull has left the Solana ecosystem facing significant damage. Solana’s reputation as a leading blockchain network has been shaken by its association with the token. Jupiter Exchange, a platform within the Solana ecosystem, admitted to knowing about the project weeks before its launch. Though Jupiter denied involvement, the lack of transparency has further damaged trust. Trading volumes across the ecosystem have dropped, with some comparing the fallout to levels seen in December of last year.
