On February 19, blockchain researchers reported that approximately $99 million in cryptocurrency was withdrawn from a coin embroiled in a scandal in Argentina by eight digital wallets associated with the creator of the crypto token.
Argentinian President Javier Milei briefly mentioned the little-known crypto coin $LIBRA in a post on social media which he later deleted, denying any connection to the cryptocurrency.
A federal judge is investigating the token's launch and Milei's involvement, following a surge in its value on Friday, instigated by Milei, which subsequently plummeted.
Milei has pointed fingers at his rivals, accusing them of exploiting the situation.
According to blockchain researchers at Chainalysis, eight crypto wallets withdrew approximately $99 million worth of tokens from the $LIBRA token's liquidity pool. These wallets received tokens directly from the creator of $LIBRA.
Chainalysis stated, "The on-chain behavior suggests that these addresses are closely related to the Libra creator team..."
Meme coins, such as $LIBRA, known for their rapid rise and fall in value, rarely involve politicians. US President and his wife recently surprised many by launching their own.
The withdrawn tokens from the liquidity pool were identified as the stablecoin USDC and Solana (SOL), with a fluctuating dollar value tied to token price variations.
Another analytics firm, Nansen, revealed that wallets removing tokens from the marketplace still hold a total value of around $87 million.
Despite this, the nature of cryptocurrency investments means that the value of holdings fluctuates with market movement.
The $LIBRA token was introduced via the Meteora crypto exchange. Efforts to contact the exchange for comment were unsuccessful.
From Sunday to Tuesday, 70% of $LIBRA wallets were reported to be experiencing losses, according to Nansen.
Hayden Davis, claiming to be connected to a firm named Kelsier Ventures, described himself as a "launch advisor" for the token and stated his intention to reinvest the substantial funds he controlled back into the token.
Davis clarified in a statement that he had no personal benefit from these funds, attempting to steer clear of any hint of impropriety or fraudulent behavior.
In an interview with the YouTube channel "Coffeezilla", Davis clarified that the situation with the token was not a scam but rather a mismanaged plan with significant funds in his custody.
Verification from the interview's host confirmed its validity, while attempts to reach Davis for comment were unsuccessful. Davis's spokesperson did not respond to Reuters' request for comment.