😳 Someone’s in Big Trouble

Happy Monday!

Argentina’s president. Javier Milei, is facing fraud charges — and possibly impeachment — after his now-deleted endorsement of the LIBRA token led to a $4.5 billion pump-and-crash. 

Who really profited, and can Milei survive the fallout? 😵

Meanwhile, the founder of Eliza Labs claims his X account was hacked, triggering a $4 million rug pull. 🤦

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Crypto Community Incensed by Insider Activity on LIBRA Memecoin Promoted by Argentina’s President 

The crypto community was outraged this weekend by activity resembling insider trading when Argentine President Javier Milei’s X account promoted the LIBRA memecoin, which soared to $4.5 billion and then crashed within hours on Friday.

At around 5 p.m. ET, Milei endorsed LIBRA telling his 3.5 million followers that the token would boost Argentina’s economy, 

LIBRA surged from $0.006 to nearly $5, until Milei deleted his X post hours later, saying “I was not aware of the details of the project and after having become aware of it I decided not to continue spreading the word (that is why I deleted the tweet).”

At that point, the token erased 95% of that value over the course of the next few hours. 

Kelsier Ventures, led by Hayden Davis, was responsible for issuing and market-making the LIBRA token. The project’s official website lists KIP Protocol as the token’s developer. 

The team behind the token cashed out as much as $87 million by removing USDC and SOL from liquidity pools, Blockchain data firm Bubblemaps said on X.

Bubblemaps later shared onchain evidence that implied the LIBRA team might be the same team that launched the MELANIA token. Bubblemaps identified that the wallet address “0xcEA” had links to the MELANIA creator, allegedly sniped millions in profits from LIBRA, and also funded the LIBRA deployer wallet address. 

Davis then himself confessed in an interview with YouTube crypto investigator Coffeezilla that the Kelsier team “sniped” the MELANIA launch. However, he claimed “we didn’t take any liquidity out — zero.” 

All parties involved in LIBRA’s launch scrambled to absolve themselves of any responsibility for the debacle. 

Despite his disavowals, Milei faces charges of fraud and possible impeachment after attorneys and political opponents pounced after his actions earlier in the day.

Lawyers filed fraud charges against Milei in criminal court on Sunday, the Associated Press reported, alleging that Milei was involved in the alleged rug pull with Kelsier Ventures and Davis, citing “an indeterminate number of frauds.”

Davis claimed that it was Milei’s “unexpected” reversal of his position that caused the token to decline. Davis also proposed reinvesting 100% of the funds under his control back into the token.

KIP Protocol claimed it was invited only to oversee aspects of the project “post-launch.”

Jupiter and Ben Chow, cofounder of Meteora, released statements about their involvement, with Jupiter saying, “We take allegations of insider trading EXTREMELY seriously. We have conducted our own investigation and cannot find any evidence of sniping by team members.”

Chow said, “Neither I nor the Meteora team compromised the $LIBRA launch by leaking information, nor did we purchase, receive, or manage any tokens.”

After reportedly discussing the matter with Kelsier, KIP said that “all market-making fees will go to a foundation in Argentina” that would continue running as planned.

“All details regarding the tokens should be directed to Kelsier,” it said. “We did not profit a single cent from today's activity.”

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Eliza Labs Founder Claims X Account Was Hacked 

Shaw, the anonymous founder of Eliza Labs, said his official X account was hacked on Sunday.

Hackers allegedly in control of the account posted a contract address for a new V2 of artificial intelligence agent platform ElizaOS. The token drew $4 million in volume before all liquidity was pulled.

“I have 2FA, password manager, strong password, etc. It was obviously well designed and targeted. Sorry to anyone who lost funds,” Shaw said on X. 

“I woke up and everyone DMed me saying my account was hacked, my wife logged in and deleted posts and connected accounts while I was asleep so I didn't see it,” Shaw said. 

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• ⚖️ The U.S. Securities and Exchange Commission’s crypto task force met with Jito Labs and Multicoin Capital to explore allowing staking in crypto ETFs, with discussions emphasizing investor benefits and improved blockchain security.

• ⏲️ The SEC requested a 28-day extension to respond to Coinbase’s appeal in a case in which the exchange stands accused of offering unregistered securities and failing to fulfill disclosure obligations, citing the formation of its new crypto task force, which could realign the way in which digital assets are classified under U.S. law.

• 📈 Blockchain.com took a step toward a potential IPO by appointing two Wall Street veterans as CFO and COO, signaling growing confidence in crypto firms going public.

• 📱 Memecoin launch platform Pump.fun on Friday unveiled a mobile app for memecoin trading, with new token launches having skyrocketed 12-fold year over year.

• 🎭 NFT company Yuga Labs sold its Meebits NFT collection to a new firm while refocusing on Bored Ape Yacht Club and its metaverse project Otherside, but Meebits will remain integrated into the virtual world.

• 💰 Investment management heavyweight State Street is set to launch a digital asset custody service next year, expanding its role in crypto after the U.S. Securities and Exchange Commission repealed a costly accounting rule that had discouraged traditional firms from holding digital assets.

• 🇦🇪 Abu Dhabi’s sovereign wealth fund invested nearly $437 million in BlackRock’s bitcoin exchange-traded fund in Q4 last year, one of its largest direct crypto investments after the asset manager was granted a local license.

• 💰 Singapore-headquartered digital asset financial services firm HashKey Group secured a $30 million investment from China-based Gaorong Ventures at a $1.5 billion valuation, underscoring continued Chinese VC interest in crypto despite Beijing’s ongoing regulatory crackdown on the industry.

• ⚽ Tether’s investment arm acquired a minority stake in Italian football club Juventus, triggering a 200% surge in the club’s fan token as the stablecoin giant expands into sports and entertainment.

1. Bribes, Insiders and a Manipulated President | What Really Happened with $LIBRA by crypto investor and entrepreneur Diogenes Casares

2. @0xsudogm, as investor at crypto-focused VC firm Dragonfly, on how spot BTC trading on Hyperliquid works exactly and why it matters

3. Chris Burniske, a managing partner at Placeholder, on how different types of sequencers affect value accrual 

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