Argentina’s stock market trembled after President Javier Milei faced a lawsuit linked to the launch of the LIBRA token. The S&P Merval index dropped 5%, recovering only partway by 2%. Following a dramatic rise and fall in LIBRA’s value, investigations into fraudulent claims were initiated, while controversies regarding significant withdrawals from the token’s liquidity surface.
The Argentine stock market experienced significant volatility as President Javier Milei faced legal challenges arising from the launch of the LIBRA token. On February 17, the S&P Merval index, which reflects the performance of Argentina’s top publicly traded companies, plummeted by 5% before staging a partial recovery of 2%. Nonetheless, the index continued to fall short of the previous week’s closing figure, primarily due to the fallout from the meme coin.
The launch of the LIBRA token on the Solana-based meme platform Pump.fun was touted by President Milei in a now-deleted tweet, where he suggested that it could serve as an economic stimulus. However, subsequent events led to a decline in the S&P Merval, with some speculators attributing the dip to a lawsuit implicating President Milei in potential fraudulent activities concerning the token.
Within hours of its debut, the LIBRA token, which initially reached a trading value of $4 billion, saw its worth tumble by 90%. In response to the circumstances, President Milei deleted his promotional tweet and announced an investigation into the matter. His office maintains that there was no prior indication of the token’s launch.
Kelsier Ventures’ CEO Hayden Davis, who serves as an advisor to President Milei on LIBRA, revealed that he and his associates actively acquired a substantial amount of LIBRA at launch—a strategy known as sniping. Highlighting controversial trading practices commonly observed in new token releases, Davis acknowledged withdrawing approximately $100 million from the project’s liquidity. He assured that he plans to engage with the Argentine government regarding these proceeds.
Despite the early turmoil, there have been fluctuations in LIBRA’s performance, including a surprising 60% increase in value following President Milei’s timely repost of a guidance tutorial on purchasing the token.
In conclusion, President Javier Milei’s endorsement of the LIBRA token, which was quickly followed by legal challenges and significant market fluctuations, has underscored the volatile nature of meme coins in the financial landscape. The subsequent decline of the S&P Merval index reflects investor concerns over potential fraud and regulatory scrutiny. As developments unfold, the situation remains precarious for both the market and the involvement of government officials.
Original Source: crypto.news
