Key Insights
Argentinian President Javier Milei was left embarrassed after the rug pull and crash of the $LIBRA cryptocurrency that he promoted.
A similar crash was seen when Donald Trump launched his own memecoin $TRUMP but that too crashed because of several reasons.
Since the successful entry of Bitcoin into reserve assets, celeb-led crypto scams have risen.
All these promotions were interesting because celebrities knew little about the cryptocurrency they promoted.
Last Friday, Argentinian President Javier Milei promoted the $LIBRA coin on his X account, sending the crypto into a bull rally to $5.
Taking a note of this, the token issuers who had hoarded this coin released their stash into the markets, causing the crypto to crash to $1 within the same day. Reports indicate that this crash resulted in a net loss of approximately $4 billion.
Later, the Argentinian Chamber of Commerce stated that this crash could have been the result of a rug-pull. Argentina is one of the largest crypto markets in the world and possibly the largest in South America.
In the world of crypto, a rug-pull is a token sell-off by the top token holders of a cryptocurrency who take the benefit of rising prices to exit the token at once, trapping other investors. Similar to a bull trap, the token creators orchestrate it themselves.
At present, it seems that the act by the Argentinian President seems to be a mistake due to his lack of knowledge on crypto which is the common scenario among political circles. But there's enough evidence against the president to prove his LIBRA tweet was a terrible mistake, even if honest.
In a country with a GDP of $120 billion, the loss of $4 billion represents a 3.3% loss to the GDP. At a time when Argentina is going through a financial rebalancing, this loss may cause a great harm to its financial health.
At present, President Javier Milei risks getting impeached, with the Argentinian opposition having threatened him with an impeachment trial.
At present, the Argentinian Chamber of Deputies has more opposition members (104) than the government (78). If the opposition obtains the confidence of the independents (68), they could impeach the President with a 2/3rd majority (170).
On 18 Jan 2025, just two days before Donald Trump became the US President, he and his wife Melania Trump sold their own official memecoins. These memecoins are named Official Trump Memecoin ($TRUMP) and Official Melania Memecoin ($MELANIA).
Their launch marked the most volatile session ever. The launch date, i.e., 18 Jan 2025, saw $TRUMP rise from $7 to $75 and crash to $35 levels within the same day. $MELANIA met the same fate on a smaller scale, i.e., launched at $7, reached a high of $13.75, and crashed to $5 within 48 hours. The volatility and FOMO of these two coins overwhelmed the Solana blockchain despite its super-high TPS of 65,000.
These coins eventually dropped to a fraction of their launch prices, and at press time, $TRUMP trades at $17.7 and $MELANIA trades at $1.26.
This prompted several news media outlets, politicians, and crypto enthusiasts to register their doubts on these coins. Most of the concerns were around the alleged misuse of the executive position of Donald Trump to shill these coins. Trump officially posted about them in his Truth Social prompting millions of buyers to buy them in a FOMO.
Upon being asked, Donald Trump promptly replied that he had little knowledge of these cryptocurrencies. It was then found out that the cryptocurrencies were indeed launched by a group called "Students for Trump" whose member Ryan Fournier was also a previous rug-puller and crashed his own memecoin TikTok coin for gains.
This person is believed to have orchestrated the entire $TRUMP coin and had launched it on behalf of Trump asking him to just make a tweet. Donald Trump seemed not to have a very little knowledge of this matter.
At the end, it was the investors whose money was lost in the speculation.
Disclaimer: Voice of Crypto aims to deliver accurate and up-to-date information but will not be responsible for any missing facts or inaccurate information. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.