The Crypto News Cycle Worsens as Meme Coins Suck the Market Dry

Speaking publicly for the first time, Milei distanced himself from accusations of market manipulation. He insisted that his social media promotion

Argentina’s President Javier Milei has finally addressed the scandal surrounding his endorsement of the meme coin Libra, which saw its price skyrocket before crashing, leaving many retail traders in the red. Speaking on Todo Noticias on Monday night, Milei distanced himself from accusations of market manipulation.

“I’m not a crypto expert,” Milei told the interviewer. “My expertise is economic growth, with or without money. As someone passionate about technology and its potential to fund projects, I simply shared the idea.”

Yet, his endorsement—intentional or not—set off a speculative frenzy. On Friday night, after Milei directed his massive online following to the Libra token, its price rose by 300% within hours, briefly pushing the market cap to an eye-watering $4 billion.

Then came the inevitable crash, leaving retail traders in the red and fueling allegations of a pump-and-dump scheme. A class-action lawsuit is now being prepared by Burwick Law, a New York-based firm, on behalf of investors who lost money.

“The biggest lesson? I can’t keep being the same Javier Milei as always,” he conceded. “Sadly, I need to start filtering who gets access to me. I thought I was helping people, but I guess I need to be more careful about the projects I choose to support. Especially in the crypto world, where so many things can go wrong so quickly.”

Economy Minister Dismisses ‘Tiny’ Crypto World

As pressure mounted, Economy Minister Luis Caputo was the first to break the government’s silence Monday evening, attempting to downplay the incident as a niche misunderstanding rather than outright misconduct.

“Cryptocurrencies are a tiny, infinitesimal world. It’s a specialist domain that’s incredibly difficult to grasp,” Caputo stated. “I don’t understand crypto either, and it’s been explained to me 800,000 times. But I do understand the markets, and I can tell you that what happened with Libra was not normal.”

Despite his attempts to reassure investors, markets weren’t convinced. The S&P Merval Index suffered its biggest one-day drop since July, plummeting 5.6% as Buenos Aires traders dumped shares in top Argentine firms.

Social Media Spin: Chainsaws and Trump’s Endorsement

While political and financial damage control continued, Milei’s team tried to shift public focus. On social media, the presidential account touted Argentina’s budget surplus and highlighted Milei’s meeting with US Senator Steve Daines. The president also posed with a chainsaw—a now-iconic symbol of his austerity drive—and reshared a post from Donald Trump, reinforcing his ties to the former US president.

In November 2024, Milei met with Donald Trump and Elon Musk at Mar-a-Lago ahead of the CPAC Investor Summit, marking Trump’s first meeting with a foreign leader after his November 5 election victory.

During the event, Milei praised Trump’s win, declaring it a victory for liberty and condemning tax systems as forced wealth redistribution. He also commended Musk, who was set to lead Trump’s Department of Government Efficiency, for his role in advancing free speech through X (formerly Twitter).

Since taking office in December 2023, Milei has aggressively cut Argentina’s government, reducing ministries from 24 to 8, laying off 25,000 public workers, slashing the federal budget by 30%, and privatizing state enterprises like Aerolíneas Argentinas and Intercargo, aligning with his libertarian vision of minimal state intervention.

Trump with Musk and Milei, Source: X

Was Milei Duped?

As speculation over Milei’s role in the Libra debacle deepens, some allies argue that he may have been tricked. Local media quoted government sources suggesting that the real culprits were those within his circle, who failed to vet the project properly.

Adding fuel to the controversy, Hayden Davis, CEO of Kelsier Ventures, the firm behind Libra, made bombshell claims in an interview with Dave Portnoy of Barstool Sports. Davis asserted that the coin’s launch was orchestrated alongside Milei and his team—though he refused to name names.

Portnoy, who personally suffered heavy losses in the crash, didn’t mince words, calling Libra “the biggest rug pull of all time.”

“I don’t believe Milei is corrupt,” Davis said. “I don’t think he even fully understands what’s going on. But the people around him are definitely making a lot of money from these meme coins, and I think he’s turning a blind eye to it. Maybe he’s afraid of losing their support, or maybe he just doesn’t want to get involved in the details. Either way, it’s not looking good for him.”

“I personally lost over a million dollars in this rug pull. And I