Argentine Court Clears Milei in LIBRA Memecoin Case, Leaving 114,000 Investors Without Recourse
TREE NEWS reports: An Argentine federal judge has dismissed criminal charges against President Javier Milei and his sister Karina Milei over their promotion of the LIBRA memecoin, ruling that the alleged conduct did not constitute a crime under Argentine law. The decision, issued by Judge Marcelo Martinez de Giorgi, accepted prosecutor Eduardo Taiano’s request to drop the investigation, citing insufficient evidence of fraudulent deception as defined by Article 336 of the Argentine Criminal Procedure Code.
The ruling follows a separate US federal court decision in October that dismissed a class-action lawsuit against Libra project organizer Kelsier Ventures, DeFi platform Meteora, and developer Benjamin Chow. Together, the two rulings effectively close the legal avenues for investors seeking restitution.
Timeline of the LIBRA Collapse
On February 14, 2025, Milei promoted LIBRA on X, describing it as a project to fund small businesses in Argentina. The token’s market capitalization briefly reached $4.6 billion before crashing over 90% within hours, as wallets linked to the project sold tokens and drained liquidity. On-chain data from Nansen shows that approximately 86% of traders lost money, with 114,000 wallets suffering combined losses of around $251 million.
Investigations later revealed that Milei had spoken by phone seven times with Mauricio Novelli, a key intermediary for the project, on the day of the promotion. A draft agreement recovered from Novelli’s phone outlined a $5 million arrangement for LIBRA promotion, with payments tied to Milei’s public endorsement and a government consulting contract. Despite these revelations, the judge found that the project itself was real, the token was issued, and transactions were traceable on-chain—factors that undermined claims of fraudulent deception.
Legal and Market Implications
The rulings highlight a significant gap in legal frameworks for memecoin-related losses. The judge noted that while presidential promotion may have boosted exposure and trust, “institutional identity, public attention, or trust itself does not constitute a fraudulent scheme.” The decision also emphasized that price volatility and loss distribution alone cannot prove criminal intent.
For the crypto industry, the case underscores the risks of politically affiliated memecoins and the difficulty of holding promoters accountable when tokens are issued transparently on-chain. It also raises questions about the adequacy of existing securities and fraud laws in addressing celebrity-endorsed token launches.
Forward Look
With legal avenues largely exhausted, affected investors have little recourse beyond civil litigation in jurisdictions with stronger consumer protection frameworks. The case may accelerate calls for clearer regulatory guidance on memecoin issuance and promotion, particularly in jurisdictions where public figures endorse digital assets. Meanwhile, the precedent set by these dismissals could embolden other promoters, reinforcing the need for investors to exercise extreme caution when engaging with politically branded tokens.
