Argentina Seizes $507K in Libra Meme Coin Crackdown Linked to President Milei—Here’s Why It Matters

Argentine authorities just froze half a million dollars tied to a viral meme coin—and the trail leads straight to the president's doorstep.

When governments clash with crypto, things get messy fast. The Libra token probe reveals how meme coins are testing regulators' patience—and wallets.

Behind the freeze: A $507K wake-up call for crypto anarchists. Turns out, even internet jokes can trigger real-world asset seizures when they cross paths with political scrutiny.

Bonus jab: Another day, another 'decentralized' project learning the hard way that fiat rails still control the off-ramps.

What Really Happened Behind the $LIBRA Meme Coin Collapse?

According to documents reviewed by Argentina’s Secretariat for Financial Investigation, the defendants are accused of running a “financial den” in the crypto world.

The order imposes an indefinite prohibition of innovation, barring any movement or sale of the frozen assets until the investigation concludes.

The decision also compels Argentina’s National Securities Commission (CNV) to notify VIRTUAL asset service providers and extend the freeze across all crypto platforms nationwide.

Investigators allege that Rodríguez Blanco and Mellino acted as intermediaries in converting cryptocurrency into fiat for Davis and two Argentine lobbyists, Mauricio Novelli and Manuel Terrones Godoy, who have also been implicated.

Authorities traced multiple transactions, including one on February 17 when Novelli’s relatives removed bags from a Banco Galicia branch hours after LIBRA’s collapse.

A key transaction saw $507,500 sent from Davis through the Bitget exchange just 42 minutes after President Milei posted a selfie with him, promoting Davis as an advisor on blockchain and AI

Prosecutors believe the funds may constitute indirect payments to public officials, with intermediaries acting as “exit ramps” to obscure the money trail.

Despite LIBRA Scandal, Milei’s Party Secures Surprise Midterm Win in Argentina

Documents suggest that months before LIBRA’s launch, Novelli and President Milei discussed projects to “monetize the president’s image,” reportedly debated at the presidential residence.

While Milei’s lawyer at the time raised concerns about potential conflicts of interest, leaked text messages from Davis appeared to boast of his influence over the Milei family, including one in which he wrote, “I send $$ to his sister and he signs what I say.”

A federal judge has ordered the unsealing of bank records for President Milei and his sister as part of the ongoing LIBRA cryptocurrency investigation.#LIBRA #Milei https://t.co/3rgxjvjyh0

The LIBRA token, launched in mid-February, briefly surged to a $4.5 billion market capitalization after Milei’s post before crashing by over 94% within hours, wiping out investor funds in a classic pump-and-dump.

Data from Bubblemaps and Lookonchain linked at least eight insider wallets to cash-outs totaling $107 million, with some proceeds reportedly funneled into other meme coins like POPE.

Further Bubblemaps identified the same wallet, address 0xcEA, behind both LIBRA and the MELANIA token, which also experienced a rapid boom-and-bust earlier this year.

Investigators believe the pattern of cross-chain transfers between Arbitrum, Avalanche, and solana networks points to a coordinated insider scheme.

In Argentina, the LIBRA collapse has had political repercussions. Although Argentina’s anti-corruption watchdog later cleared Milei of wrongdoing, claiming he only “spread the word” about the project, his public trust took a hit.

Argentina has ruled that President @JMilei did not violate public ethics laws when he supported the LIBRA memecoin earlier this year.#Libra #Argentinahttps://t.co/Eqhg9fdMI5

Polling by Zuban Córdoba showed his approval rating dropped from 47.3% in November to 41.6% in March, with more than 63% of Argentines now viewing him negatively.

However, Milei’s pro-crypto party, La Libertad Avanza, recently scored a surprise victory in the country’s midterm elections, scoring 40.68% of the national vote and winning key regions, including Buenos Aires province.