A political firestorm has broken out in Buenos Aires after the publication of a damaging Congressional report accusing President Javier Milei of a sophisticated cryptocurrency fraud scheme. After a three-month investigation, legislators in the Chamber of Deputies officially accuse the libertarian leader and his sister, Presidency Secretary Karina Milei, of carrying out a “textbook rug pull” that cost investors millions. The investigation findings, detailed in a 200-page document, indicate a likely systematic abuse of presidential authority to pump the value of the now-very-famous LIBRA token.
‘Presidential Pump’
The scandal revolves around a controversial post by President Milei made on X, (formerly Twitter) earlier this year. According to the report, Milei used his massive social media platform to endorse the token, writing, “The world wants to invest in Argentina. $LIBRA.” Crucially, the post included the project’s specific contract number—data that investigators say was not publicly available until the President shared it.
The market reaction was instant and explosive. Following the recommendation, the LIBRA token reached a high of $5. Nevertheless, the excitement was fleeting. Within hours, the developers tied to the project carried out a large sell-off, exiting somewhere from $80 million to $100 million in liquidity. The report concludes that, in the absence of the President’s direct involvement, the token would have never seen the trading volume necessary for such a large theft.
The Inner Circle: 16 Meetings at Casa Rosada
Arguably the most damaging evidence in the report is the truly personal level of access provided to the architects of the scheme. Investigators uncovered records of at least 16 separate meetings between President Milei and the creators of LIBRA, including U.S. entrepreneur Hayden Davis and Argentine businessmen Mauricio Novelli and Manuel Terrones Godoy.
These meetings took place at both the Casa Rosada—the executive mansion—and the official presidential residence in Olivos. Policymakers contended that such high-level engagement organized by Karina Milei contradicted the administration’s defense that the promotion was just a post on social media that was merely careless or misguided. Instead, the frequency of the contact suggested a coordinated effort to validate the project by utilizing the accouterments of the state.
A Repeat Offender? The KIP Protocol Connection
The inquiry confirmed that LIBRA was not merely an isolated event, but demonstrated a consistent course of conduct. The report explicitly connects this to December 2024 when President Milei endorsed a different digital asset- “the KIP Protocol”.
Investigators found that the KIP project was tied to the same network of operatives, specifically Novelli and Terrones Godoy. “The investigated events are compatible with an alleged scam,” stated Maximiliano Ferraro, a deputy from the Coalición Cívica and president of the investigative commission. The repetition of these tactics—endorsing a niche token linked to the same circle of associates just before a liquidity exit—has led lawmakers to allege a systemic abuse of power.
Legal Battles and the ‘Judicial Wall’
While the congressional report is a political indictment rather than a criminal verdict, the legal ramifications are escalating. More than 100 criminal complaints from defrauded investors and civilian organizations have been presented to Argentine courts. Internationally, the stakes are even greater. Burwick Law in New York is currently pursuing a class-action lawsuit against Milei to allege violations of securities laws and defrauding investors globally.
Domestically, however, the investigation has faced significant headwinds. Lawmakers have publicly accused federal Judge Marcelo Martínez de Giorgi of obstructing their work. According to the report, the judge had denied the commission access to crucial case files, creating in effect a “judicial wall” to protect the administration from more serious scrutiny. Javier and Karina Milei both declined to respond to the legislative inquiry, adding to the impression of a cover-up.
Complicated Future Ahead for Crypto Banking
In a strange turn, as the scandal unfolds, Argentina’s traditional banking sector is about to onboard the very technology at the center of the scandal. At the recent LABITCONF 2025 conference, Gabriel Campa, Head of Digital Assets at Towerbank, revealed that major Argentine banks are ready to launch their own crypto services.
“The Argentine banking sector is about to re-enter the crypto market,” Campa noted, explaining that institutions have already built the necessary internal systems and are merely waiting for regulatory approval from Milei’s administration. The banks are expected to follow a hybrid model, characterized in part by in-house development and in part by partnerships with established crypto companies. Therefore, the billion-dollar question is whether the LIBRA scandal will delay approvals or induce a regulatory crack-down.
