According to the lawsuit, the token developers secretly manipulated liquidity and misled investors with false promises, defrauding people of millions of dollars.
Libra was positioned as a project to stimulate the Argentine economy, and even received the support of Argentine President Javier Milei. Milei promoted the token on his social media, and after the Libra price crashed, he said that this was a mistake, since he did not know the details of the crypto project.
The plaintiffs claim that the token developers artificially inflated prices using a one-way liquidity pool. To maintain control over the Libra price, its creators withheld 85% of the token supply. After trading began, insiders withdrew $107 million, which led to a 94% collapse in Libra’s price, while they were able to profit at the expense of unsuspecting investors, according to court documents.
In addition to lawsuits, the Libra incident has attracted the attention of politicians. The opposition in Argentina is calling for Milei’s impeachment, accusing him of fraud, insider trading, conspiracy, and abuse of office. The Libra scandal has seriously damaged Milei’s image as a leader focused on economic recovery and fighting corruption. The president’s approval rating has dropped from 55% to 45%. Meanwhile, Argentine lawyer Gregorio Dalbón has requested a “red notice” from Interpol for Kelsier Ventures CEO Hayden Davis, who made $100 million in profits from the crypto project. Dalbón fears that this money will help Davis escape justice.