Argentina’s $4.6 Billion Crypto Scandal; Largest-Ever Crypto Theft

Argentine President Javier Milei is in hot water after his brief foray into crypto that left the opposition calling for his impeachment and a judge launching a fraud probe.

On February 14, Milei took to X to promote a little-known token called LIBRA, claiming it would boost Argentina’s economy by funding small businesses. His post linked to a website featuring his signature slogan, “long live freedom,” and assured his 3.8 million followers that “the world wants to invest in Argentina.” Thousands did. LIBRA skyrocketed from near zero to almost $5—before crashing to under $1 within hours.

Milei quickly deleted the post, claiming he was unaware of the project’s details, but the damage was done. Lawyers in Argentina, led by Milei’s political opponent Claudio Lozano, filed more than 100 fraud complaints against the president, and an Argentine judge opened up an investigation.

Crypto entrepreneur Hayden Davis admitted to participating in the launch of LIBRA—as well as MELANIA, a memecoin tied to the First Lady that briefly hit a $2 billion market cap before crashing. In an interview with YouTube scam-buster Coffeezilla (Stephen Findeisen), Davis revealed he controlled about $100 million made on LIBRA and detailed a scheme known as sniping—a practice where insiders or bots swiftly buy up newly launched tokens at ultra-low prices before the general public can react, driving up demand and price, only to sell at a massive profit. In regulated markets, this would be considered illegal front-running. He also named two organizers of Tech Forum, a Latin American tech conference, as fellow participants in the launch.

As the backlash mounted, Davis attempted damage control. “I want to make it unequivocally clear that I have not, nor will I, take any of these funds for my personal benefit,” he wrote in a statement on X. In a separate interview with Barstool Sports, he described the fiasco as an "experiment that happened to go very wrong." He insisted Milei wasn’t corrupt—just surrounded by people who might be. Meanwhile, Barstool Sports’ Dave Portnoy claimed Davis personally refunded him $5 million lost in the LIBRA fiasco.

The numbers paint a brutal picture: 86% of traders who bought into LIBRA lost money, with total losses reaching $251 million, according to blockchain analytics firm Nansen. A lucky few pocketed $180 million.

Ben Chow, cofounder of the decentralized exchange Meteora, which facilitated the launches of LIBRA, MELANIA, and TRUMP, resigned, according to a February 18 post from his pseudonymous cofounder Meow.

HACKERS STOLE $1.5 BILLION FROM CRYPTO EXCHANGE BYBIT

In what’s now the largest crypto heist on record, Bybit, a Dubai-based crypto exchange, lost $1.5 billion in digital assets after hackers gained control of one of its cold wallets, offline storage systems, on Friday. Blockchain analysts point to North Korean hackers, the usual culprits behind some of the industry’s biggest breaches. The stolen funds, mostly ether, were swiftly transferred across multiple wallets and platforms. Despite the blow, Bybit CEO Ben Zhou assured customers that the exchange remains solvent, claiming all client assets are fully backed and the company can cover the loss.

CRYPTO AND BLOCKCHAIN ON FORBES’ FINTECH 50

As crypto goes mainstream, a new wave of firms is reshaping finance—and Forbes’ Fintech 50 highlights the biggest players leading the charge. From tokenizing real-world assets to securing institutional capital, these blockchain innovators are driving a financial shift once dismissed as speculative hype. Read more.

ELSEWHERE

Coinbase Says S.E.C. Will Drop Crypto Lawsuit [The New York Times]

Some Crypto Traders Caught In FTX Collapse Are About To Get Paid Back [The Wall Street Journal]

Written By: Nina Bambysheva

Nina Bambysheva leads crypto coverage at Forbes, reporting on everything from industry-defining trends and major deals to regulation. She also writes Crypto Confidential, Forbes’ weekly crypto newsletter, and co-edits the 30 Under 30 Finance list. Since joining Forbes in 2020, she has reported extensively on the rise and fall of FTX and its founder, Sam Bankman-Fried, Binance, stablecoin issuers Tether and Circle and was the lead editor of Forbes’ Blockchain 50 list, which tracked how large corporations were using blockchain technology. She holds degrees from New York University Abu Dhabi and Columbia University’s Graduate School of Journalism. Have a tip, question or comment? Contact her at @ninabambysheva on Twitter. You can also DM for Signal or send tips to the Forbes SecureDrop.

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