Argentina's LIBRA Controversy Exposes Connections Between Cryptocurrency and Politics Amid Worldwide Asset Freezes

An Argentine federal court has indefinitely frozen the assets of several people associated with the LIBRA

controversy, which has become politically charged after links to President Javier Milei surfaced. Judge Marcelo Martínez de Giorgi issued the order, targeting U.S. businessman Hayden Davis, who founded the project, as well as Colombian national Favio Camilo Rodríguez Blanco and Argentine citizen Orlando Rodolfo Mellino. Prosecutors claim the three orchestrated a pump-and-dump operation worth between $100 million and $120 million, with Davis allegedly using Milei’s support to boost the token’s price, according to .

The court’s “prohibición de innovación” ruling blocks any sale or transfer of assets, including digital currencies, to secure evidence during the ongoing investigation, as reported by

. Federal prosecutor Eduardo Taiano, who initiated the freeze, warned of possible asset concealment and stressed the importance of tracking funds from questionable transactions. One such transaction was a $507,500 transfer Davis made through Bitget just 42 minutes after sharing a selfie with Milei on January 30, where Davis was promoted as an advisor in blockchain and AI, according to . Blockchain analytics firms TRM Labs and Chainalysis traced $90 million in transactions connected to LIBRA’s downfall, with funds routed through exchanges such as Bitget and Gate.io, according to .

The investigation has sparked debate due to its political ramifications. Prosecutors allege that intermediaries like Rodríguez Blanco and Mellino converted crypto assets to fiat currency to disguise payments that may be linked to Milei’s associates. Text messages reportedly show Davis boasting about his sway over the president, saying, "I send money to his sister and he signs what I say," as reported by

. Although Argentina’s anti-corruption office previously found Milei not guilty of ethical breaches, public confidence in him has declined, with approval ratings falling to 41.6% in March 2025, according to .

The controversy has also reached global markets. In the U.S., a class-action suit accuses Davis and Meteora Trading of operating a “fraud factory” under the RICO Act, alleging coordinated international efforts to deceive investors, as reported by

. At the same time, Argentina’s National Securities Commission (CNV) has ordered crypto platforms to enforce the asset freeze, expanding regulatory oversight to all virtual asset service providers, as reported by .

The LIBRA investigation highlights increasing international regulatory attention on the intersection of cryptocurrency and politics. For example, Brazil has recently introduced tighter crypto regulations, requiring digital asset companies to obtain approval from the Central Bank by 2026, as reported by

. In the United States, bipartisan Senate proposals seek to transfer crypto oversight from the SEC to the CFTC, focusing on commodity-based regulation, as reported by .

As the Argentine probe continues, its outcome could shape how countries handle political influence in the crypto sector. For now, the freeze on Davis’s assets—and the looming threat of further penalties—marks a significant step in Argentina’s efforts to separate financial wrongdoing from high-profile digital asset endorsements, as reported by

.