Argentina Stock Market Plunges After Milei Meme Coin Scandal

In Brief:

Argentina's S&P Merval index dropped over 5% following President Milei’s meme coin fraud allegations.

LIBRA token surged to $4 billion in market cap before crashing 90%, raising rug pull concerns.

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Argentina’s stock market took a sharp hit on Monday as President Javier Milei faced fraud charges over his promotion of the Solana-based meme coin LIBRA. The S&P Merval index plummeted by more than 5% at market open in Buenos Aires before recovering slightly, still trading 3% lower than its previous close.

The turmoil followed Milei’s endorsement of LIBRA on X (formerly Twitter), touting it as a project aimed at boosting Argentina’s economy. However, after soaring to a $4 billion market cap, the token crashed nearly 90% within hours. On-chain analysts flagged suspicious wallet activity, suggesting a rug pull.

Kelsier Ventures CEO Hayden Davis, a key figure in the project, admitted withdrawing approximately $100 million from LIBRA’s liquidity pool but claimed he was awaiting government directives on its use. The Argentine government has since distanced itself from the project, launching an investigation. Legal proceedings against Milei are underway, with a judge expected to take action soon.

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