Argentina Freezes Assets in $120 Million Libra Crypto Scandal
Argentina’s judiciary has escalated its investigation into one of Latin America’s largest crypto scandals, ordering a sweeping freeze on the assets of U.S. citizen Hayden Davis and two regional associates accused of orchestrating the downfall of the Libra memecoin.
Federal Judge Marcelo Martínez de Giorgi issued the ruling this week, targeting bank accounts, digital wallets, and real estate linked to Davis, Argentine operator Orlando Rodolfo Mellino, and Colombian trader Favio Camilo Rodríguez Blanco. The decision follows mounting evidence that investors across several countries lost over $100 million in what prosecutors describe as an elaborate digital fraud scheme.
Investigators said the measure aims to prevent the suspects from moving or hiding assets while financial authorities track missing funds. Argentina’s National Securities Commission (CNV) was also directed to alert all registered crypto platforms to enforce the freeze nationwide.
The Rise and Collapse of Libra
The Libra token entered the spotlight early this year when it skyrocketed after U.S. promoter Hayden Davis was briefly referenced by President Javier Milei as an “AI and blockchain adviser.” Within hours, retail investors poured in, only to see the token’s price implode shortly afterward, erasing an estimated $250 million in paper value.
Davis, a self-styled crypto marketer, has since become the focus of investigations stretching from Buenos Aires to New York. In May, a U.S. federal judge temporarily froze $57 million in USDC stablecoins associated with Davis and executives at the now-defunct Meteora exchange. The order was later lifted, though the funds remain under scrutiny amid ongoing restitution efforts.
Allegations of Organized Fraud
Court filings from investors in both hemispheres allege that Davis and his collaborators—including Meteora’s former CEO Ben Chow—ran a coordinated “rug pull” operation. The plaintiffs invoked the Racketeer Influenced and Corrupt Organizations (RICO) Act, claiming Davis’s projects, including Libra and M3M3, were part of a recurring pattern of deception designed to extract capital from retail traders.
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Judge Martínez de Giorgi’s order, however, stops short of imposing criminal charges. Instead, it focuses on safeguarding potential restitution and preserving digital evidence, reflecting Argentina’s effort to align its judicial approach with U.S. proceedings in the same case.
Political Shadows and “Cryptogate”
The scandal has taken a political turn as investigators uncovered token transfers coinciding with Davis’s visits to Argentina. Blockchain records reportedly show intermediaries liquidating coins during meetings between Davis and President Milei at the Casa Rosada. These revelations fueled a wave of speculation in local media, now dubbed “Cryptogate.”
While Milei himself has not been accused of wrongdoing, the controversy has cast a shadow over his administration’s pro-crypto stance. The president’s La Libertad Avanza party nonetheless strengthened its political position, winning Argentina’s midterm elections and setting the stage for his 2027 re-election campaign.
A Warning for Global Regulators
The Libra affair underscores how easily cross-border token projects can evade oversight — until judicial systems cooperate. Coordinated actions between Argentina and the United States represent one of the first attempts by two major jurisdictions to jointly pursue assets on the blockchain.
For regulators, the message is clear: crypto fraud is no longer a local problem, and political proximity offers no immunity when the blockchain trail leads straight to the courtroom.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
