A President, an Unknown Venture Fund, KOL Insider Trading, and 9 Figures in Extracted Value—What Happened With $LIBRA?

Solana’s trench warriors are in shellshock following one of the network’s biggest onchain DeFi crises in recent memory. 

Insider trading has always been a part of memecoin trading, but this weekend’s $LIBRA launch demonstrated corruption among network participants at a global scale.

A President, an unknown venture fund, exposed KOL insiders, and over 9 figures in extracted value—What happened with $LIBRA?

Milei-Promoted Memecoin Rugs

On February 14, libertarian Argentinian President Javier Milei tweeted his support for $LIBRA, a memecoin promising to stimulate the nation’s “economy by funding small Argentine businesses and startups”.

Bouyed by the pro-crypto President’s support, $LIBRA exploded to a market capitalization of over $4B. Traders poured funds into the coin, hoping to repeat the remarkable profits early buyers realized on $TRUMP.

However, on-chain analytics quickly revealed that foul play was at work. Shortly after the launch, Bubblemaps reported that 82% of $LIBRA supply was linked to one cluster. To make matters worse, $LIBRA didn’t share any tokenomics, and the entire 82% cluster was completely unlocked.

Inevitably, early buyers began liquidating their holdings. Insiders and large holders sold millions of dollars worth of $LIBRA on unsuspecting retail traders. Within 45 minutes, $LIBRA had lost over $3B in market cap, extracting millions from retail users.

Amidst the chaos, Javier Milei renounced his endorsement of the memecoin. After deleting his original 𝕏 post promoting $LIBRA, the Argentinian President released an official statement, asserting he was not aware of the project’s details.

Argentinian lawyers have since filed fraud charges against Milei, arguing that the “President’s actions were essential” to committing “an indeterminate number of frauds,”

While celebrity coin scams and insider trading are undeniably commonplace in Solana’s memecoin casino, social media commentators argue that never before has it been performed at this scale. 

The $LIBRA rabbit hole runs deep, with allegations touching some of Solana’s most prominent names, alongside unheard-of VC firms who somehow got in Milei’s ear.

Insider Trading Allegations Tarnish Solana DeFi 

In the wake of the Milei disaster, several blockchain analysts have uncovered linked wallets that the team behind $LIBRA is also responsible for similar high-profile launches, including $MELANIA.

Other onchain sleuths have suggested that this team’s fingerprints are smeared across a wrath of ‘hyped’ memecoin launches, including $ENRON, $HOOD, and notably, $M3M3, which was launched through Meteora’s memecoin deployment protocol. Originally launched in December 2024, $M3M3’s onchain debut was soured by suspicious wallet activity suggesting insider involvement.

In a recent statement, Meteora co-founder Ben Chow acknowledged that he has referred memecoin project leads to Kelsier Ventures Hayden Davis. Chow confirmed that Davis and Kelsier Ventures orchestrated the $M3M3 launch, causing concerned commenters to question the integrity of the relationship in the wake of $M3M3’s controversial launch.

Backs against the wall, Davis and Kelsier Ventures released a statement shifting the blame back to Milei. Davis claims the reason for the token’s failure lies with Milei’s abrupt decision to denounce the coin, asserting that Kelsier and fellow sponsor KIP Protocol are “completely innocent of any wrongdoing”.

However, revelations from Barstool Sports founder Dave Portnoy discredit Davis’s posturing. Speaking live on 𝕏, Portnoy revealed that Davis sent him an allocation of $LIBRA tokens and instructed him not to disclose that he’d received free tokens.

It has since been revealed that a large number of memecoin KOLs and influencers were tipped off about an upcoming Argentina coin.

Popular KOLs like ThreadGuy and Frank have put themselves in precarious positions. After admitting that he’d been informed of the coin’s existence ahead of the launch, ThreadGuy muted a suspicious conversation on livestream while covering his mouth to deter lip-readers. 

In a now-deleted tweet, Frank suggested “if you’ve been in crypto for more than 4 years and you’re not somewhat of an insider you need to rethink your strategy.”

Jupiter, one of Solana’s biggest applications, also had its name dragged through the mud. Easy, founder of the BoDoggo’s NFT collection, denounced the Jupiter/Meteora/Moonshot trifecta, insinuating that Jupiter abused its position of trust to promote the coin.

Easy alleges that Jupiter instantly verifies tokens like $LIBRA, $MELANIA, and $TRUMP, expediting their listing on the Moonshot application to generate euphoric FOMO, while profiting from fees and potential insider positions.

Jupiter Head of Communications Kash Dhanda refuted this claim, highlighting that $LIBRA was never listed on the Moonshot app and asserting that the Jupiter team had no involvement in the token’s launch.

In an official statement, Jupiter acknowledged that they were made aware of the Milei-endorsed memecoin around two weeks before its launch. Jupiter claims this knowledge was “an open secret” in memecoin circles, but confirmed that co-founder Meow knew about the launch date and Meteora’s Ben Chow had the token’s CA before launch for verification purposes.

Jupiter has since completed an internal investigation, but didn’t find any of its team members to have sniped $LIBRA tokens or acted on insider information. Network participants with any evidence of insider trading from within the Jupiter team are encouraged to contact the protocol directly.

Another Critical Set-Back for Crypto

All things considered, the crypto community agrees the $LIBRA disaster is a low point for the industry. The inauguration of a pro-crypto administration in the United States has inspired a new wave of onchain crime fraught with insider trading and undisclosed promotion deals on the global stage.

Javier Milei and the Argentinian Government have launched their own investigation into the $LIBRA scandal, which has cast a significant blow to the President’s credibility.

Despite the crypto community’s horrendously short attention span, market participants are united in the belief that the $LIBRA launch will have long-term adverse effects on the space. 

Optimistic traders and investors hope that the $LIBRA scandal marks a shift away from memecoin markets and returns attention to the Solana ecosystem’s wealth of genuine products.

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