Libra crypto plunges as $99 million withdrawn

Approximately $99 million was extracted from the liquidity pool of the Libra cryptocurrency, which has been embroiled in controversy involving Argentinian President Javier Milei.

Blockchain researchers identified eight digital wallets, which received funds directly from the token’s creator, as the sources behind the withdrawal. President Milei, who had promoted the Libra token on Friday, later distanced himself from the cryptocurrency amid a federal investigation into the token’s launch and his potential involvement.

The value of the Libra token spiked to $4.50 before experiencing a sharp decline just hours later. Chainalysis, a blockchain research firm, reported that the wallets in question withdrew the funds in the form of USDC, a stablecoin, and Solana (SOL) cryptocurrency. The identity of the wallet owners remains unconfirmed, but their direct funding from the Libra creator suggests a close association with the launch team. Nansen, another analytics firm, noted that the wallets still hold about $87 million worth of cryptocurrencies.

The market has seen significant activity around the Libra token, with 70% of wallets trading it between Sunday and Tuesday incurring losses. The token was launched on the Meteora crypto exchange, which has not provided comments on the situation.

Hayden Davis, CEO of Kelsier Ventures, claimed to have control over nearly $100 million of crypto from the Libra marketplace. In a statement, he expressed his intention to reinvest the funds back into the token and denied any plans for personal gain. Davis also addressed allegations of a "rug-pull" scam in an interview, stating that the situation was a failed plan rather than an intentional fraud.

This development comes amid scrutiny of meme coins, which are known for their volatility and association with internet trends. The situation with the Libra token is particularly notable due to the involvement of a political figure, a rarity in the cryptocurrency industry. The investigation into the token’s launch and the president’s involvement continues, with the market responding to these unfolding events.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.