Market Insight: The LIBRA Token Collapse

Argentine President Javier Milei has withdrawn his endorsement of the LIBRA meme token following an 85% price crash, admitting he failed to conduct due diligence before promoting it on his official X account. Blockchain data reveals 82% of LIBRA’s supply is concentrated in a few addresses, raising alarms over centralized control.

 

Key Analysis:

  • Presidential U-Turn:
    Milei deleted his promotional tweet and stated:

    “I supported a private enterprise without knowing the details. After learning more, I decided to retract my endorsement.”

  • Liquidity Crisis:
    LIBRA’s value plummeted after developers allegedly withdrew 87millioninliquidity,collapsingitsfullydilutedvaluationfrom4.5 billion to near-zero.
  • Project Claims:
    LIBRA was marketed as part of the “Viva La Libertad” initiative to boost Argentina’s economy, but its legitimacy remains unverified.

Bitcoin & Regulatory Context

This is not Milei’s first crypto controversy. In 2021, he promoted CoinX, a project accused of operating as a Ponzi scheme:

  • False Promises: CoinX claimed to use AI trading for high returns but failed to deliver.
  • Legal Fallout: Investors sued Milei for $300,000 in losses, leading to a shutdown order by Argentina’s securities regulator.

Why It Matters:

  • Investor Warnings: Celebrity endorsements often mask high-risk or fraudulent projects.
  • Regulatory Gaps: Calls for stricter oversight on politically-backed crypto initiatives.
  • Meme Culture & Market Risks

The LIBRA crash underscores systemic issues in meme-driven tokens:

Colin Winston

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