The Chamber of Deputies of Argentina has passed three bills to create a special commission on the LIBRA meme coin fraud. The case has exerted pressure on President Javier Milei’s administration since February to come clean about the reality.

The vote passed with 128 deputies in favor and 93 against it, with seven abstaining. The committee will have the right to convene high-ranking officials and demand paperwork from other public bodies. The commission is expected to hear testimonies from Economy Minister Luis Caputo, Justice Minister Mariano Cúneo Libarona, and Chief of Staff Guillermo Francos.

Representative Pablo Juliano emphasized that there must be clarity and added that Congress has to assess the damage that Argentina had or failed to have.

Sabrina Selva pointed out that both should be compelled to testify. She cited the possibility of both participating in the contentious events. She further argued that all officials should be made to answer to Congress, and there should be no exemption.

“ Karina Milei, Javier Milei, and Manuel Adorni, whom we had also requested from our bloc, were excluded from the interpellation. We will insist that these officials come and explain themselves to the Investigative Committee”

~ Sabrina Selva, Member of the Chamber of Deputies of Argentina.

LIBRA token collapse sparks allegations of fraud

The allegations arose from a claim that President Milei endorsed the social media trading of the LIBRA token, causing its prices to rise. After Milei’s post on X, the token rose from $0.000001 to $5.20 in just under 40 minutes, touching on $4 billion in market capitalization.

Subsequently, the token’s creators, who possessed 70% of the total tokens, dumped them. This saw the coin’s price drop by more than 94% to $0.99. Traders accused Milei of promoting a pump-and-dump scheme, which he vehemently denied after deleting the promotional posts.

The legal action was initiated by lawyers Marcos Zelaya and Jonathan Baldiviezo, together with engineer María Eva Koutsovitis and economist Claudio Lozano on February 17. The complaint accuses Milei of deception regarding the cryptocurrency.

The investigation deepened when the blockchain analytics firm Nansen investigated aspects of LIBRA’s development, which were rather worrying. Nansen said that 86% of the investors incurred a loss of $251 million, whereas only a small portion made a profit of more than $180 million.

The blockchain firm Bubblemaps exposed some of the links between the LIBRA creators and previous pump-and-dump schemes. The report noted the stolen funds were distributed to other wallets associated with the other scandalous coins, including MELANIA.

Calls for transparency grow as class action lawsuits loom

Although the committee will be questioning several top officials, a line-up of opposition lawmakers vowed to ensure that President Milei and Karina Milei are held accountable. Congresswoman Gabriela Estevez noted that the people of Argentina have the right to know how the fraud was committed and the individuals who took part in it.

“It is necessary for all Argentines to know how the fraud was planned and carried out, and the involvement of the President and each official.”

~ Estevez

The LIBRA scandal has already caused a considerable shake-up in the cryptocurrency market. As per CoinGecko, LIBRA led to the erasure of $26 billion in the meme coin market, hitting meme platforms like Pump.fun. Some international law firms, including Burwick Law, have started instituting legal proceedings by filing class action suits for the international investors who LIBRA defrauded.

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