Facts Behind Argentina's Impeachment Call for Milei after Crypto Endorsement

February 19, 2025 | 10:59 am

TEMPO.CO, Jakarta - President of Argentina Javier Milei is now facing impeachment threats after being involved in a controversy that has shaken the world of politics and finance.

Milei is suspected of promoting the $LIBRA cryptocurrency, which then experienced a drastic fall in just a matter of hours. This event has sparked the anger of the opposition and led to demands for his impeachment. Here is a summary of the scandal as reported by Reuters and coindesk:

Promotion of Crypto LIBRA by the President

On Friday night, Javier Milei posted on the X platform (formerly Twitter) recommending the cryptocurrency called $LIBRA. In his post, Milei mentioned that $LIBRA is a privately managed project aimed at supporting small and medium enterprises in Argentina.

This statement immediately caught the public and investors' attention, who then flocked to buy the token.

Surge and Fall of LIBRA Price

Just a few hours after Milei's post, the price of $LIBRA soared to nearly $5 per coin. This increase was driven by public confidence in the president and massive speculation in the market.

However, this euphoria did not last long. Several hours after reaching its peak, the value of $LIBRA drastically plummeted to below $1. The sudden drop in price caused many investors to suffer significant losses in a short period of time.

Allegations of Fraud Scheme (Rug Pull)

Several analysts and fintech chambers in Argentina have stated that this case has the potential to be a "rug pull." A "rug pull" is a fraudulent scheme in the crypto field where developers of a project attract investors, raise the token's value through massive promotion, then sell their ownership and abandon the project, causing the token's price to plummet.

In the case of $LIBRA, there are allegations that developers and certain parties with internal information carried out a massive fund withdrawal before the token's price fell.

Opposition Reaction and Impeachment Call

This scandal has sparked a strong reaction from the opposition in Argentina. Leandro Santoro, a member of the opposition coalition, stated that this event has embarrassed Argentina on the international stage and raised serious questions about Milei's integrity and prudence as a leader.

Santoro and several other opposition members have called for Milei's impeachment as a form of accountability for his involvement in this scandal.

Removal of Posts and Milei's Clarification

After the fall of $LIBRA's price and pressure from various parties, Milei deleted his post on X. According to local media reports, the post only lasted for a few hours before being deleted.

In his official statement, Milei claimed that he did not have in-depth knowledge of the project and only realized the actual situation after receiving additional information. He also emphasized that he had no financial involvement in the $LIBRA project.

“I was not aware of the details of the project and once I found out, I decided to not continue giving it publicity,” said Milei in his statement, as quoted by Reuters.

Significant Financial Losses and Market Impact

This scandal has caused significant impact on the crypto and financial markets in Argentina. According to data from Kobeissi Letter and Bubblemaps, about $87.4 million was withdrawn from the crypto market after panic hit investors.

The market capitalization of $LIBRA itself experienced a sharp decline, losing more than 90 percent of its value, equivalent to more than $4 billion in just a matter of hours.

Political Implications and Challenges for Milei

This incident has been a major blow to Javier Milei, who has just taken office as President of Argentina.

Since taking office, Milei has grappled with major economic challenges, including soaring inflation and market instability. This scandal has further damaged his public standing and given the opposition more leverage to challenge his administration.  

Whether the impeachment process will move forward or merely serve as political pressure remains uncertain. However, one thing is clear—this case has shaken Argentina's political landscape and significantly impacted public trust in his leadership.

The unfolding developments surrounding the impeachment and the ongoing investigation will continue to draw attention in the days ahead.

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