Argentine President Javier Milei faces impeachment threats after his social media endorsement of a virtually unknown cryptocurrency caused a massive financial uproar. The $LIBRA coin, which Milei tweeted about, saw its value skyrocket then plummet within hours. This burnt the pockets of many hopeful investors, according to BBC.
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Tweet Triggers Financial Fallout
The fiasco began innocuously enough with Milei promoting $LIBRA on his X account—formerly Twitter—boasting over 3.8 million followers. His tweet promised that this “private project will be dedicated to encouraging the growth of the Argentine economy.” However, the situation took a nosedive when he deleted the tweet shortly after. He then disavowed any connections with the project due to a lack of awareness about its specifics.
In response to CNN’s queries, Milei’s team labeled the incident a “mistake,” while the presidency initiated an investigation to sniff out any misconduct by government officials, including Milei himself. According to Pablo Sabbatella, a crypto security expert, the scenario was a classic “pump and dump”—prices were inflated by major holders and then dropped, leading to staggering profits for a few and losses for many.
Political Repercussions Heat Up
The political backlash was immediate and fierce. The Union for the Homeland coalition, alongside other opposition members, has been vocal about pushing for impeachment proceedings. CNN reported that these developments have deepened the political divide, with Milei’s supporters calling the impeachment threats a move to “overthrow” him. Meanwhile, Security Minister Patricia Bullrich defended Milei on Radio Rivadavia, comparing his promotional tweet to a presidential endorsement of a local business, meant to spur economic interest rather than manipulate markets.
Legal Eagles Circle
The debacle has not just been limited to political arenas. Legal complaints of fraud have been lodged against Milei, with plaintiffs claiming the president’s actions were pivotal in what they term a financial “rug pull.” This term is colloquially used to describe a scenario where crypto promoters bail out on their project after collecting funds from investors. This has added a legal tinge to the already politically charged atmosphere.
It remains to be seen how this will affect Milei’s presidency and the broader implications for cryptocurrency regulations in Argentina. This episode serves as a cautionary tale about the volatile nature of digital currencies and the political risks of endorsing them. Investors can track how these unfolding events could influence their favorite cryptocurrency prices on the TipRanks Cryptocurrency Center.
