Libra Token Insiders Move Millions from Failed Meme Coin to Capitalize on Solana Price Dip Amidst Investigations

The wallets associated with the defunct Libra (LIBRA) meme coin continue to transfer funds across different blockchains, despite ongoing asset freezes and fraud investigations in both the United States and Argentina.

Key Takeaways

Withdrawal of Funds: Insiders have moved nearly $4 million from the failing LIBRA token into Solana.
Legal Scrutiny: Investigations are underway as multiple assets are frozen in the U.S. and Argentina.
Market Impact: The collapse of LIBRA led to a rapid $4 billion loss in market cap, raising questions about regulatory oversight.
Political Repercussions: Argentine President Javier Milei faces political fallout amid ongoing investigations into financial misconduct linked to the token.

Libra Token Insiders Drain Millions From Failed Memecoin to Buy the Solana Dip Amid Probe

Recent blockchain data indicates that insiders linked to the project have withdrawn millions from the failure of the token and reinvested those funds into Solana, especially during the recent downturn in the market.

Fresh Wallet Movements Increase Scrutiny on Libra Insiders

According to blockchain analytics platforms like Onchain Lens and Nansen, two wallets identified as “Defcy” (the Libra Deployer) and “61yKS” (designated as “Libra: Wallet”) have removed close to $4 million in liquidity from the LIBRA ecosystem before reallocating the funds into Solana.

Data reveals that the Libra Deployer wallet had an additional $13 million in USDC prior to the transfers, while the “61yKS” wallet managed approximately $44 million in USDC as of Monday.

This ongoing activity in the wallets has raised new concerns regarding the level of control authorities have over the remaining assets of the project.

Earlier this year, as LIBRA faced a collapse, insiders withdrew around $107 million in liquidity, which contributed to a drastic $4 billion wipeout in market capitalization in just a few hours.

The project's swift rise and fall were exacerbated by support from Argentine President Javier Milei. A public selfie with founder Hayden Davis helped elevate the token's valuation to a peak of $4.5 billion, before it plummeted by more than 94%.

The fallout has initiated investigations in several jurisdictions. In the U.S., a federal judge froze $57.6 million in USDC in May as part of a class-action lawsuit against Kelsier Ventures and its three founders, Gideon, Thomas, and Hayden Davis, for allegedly misleading investors.

In August, Judge Jennifer Rochon lifted the freeze, ruling that investors would not experience irreparable harm since the funds remained recoverable.

Despite the lifting of the freeze, wallet activities indicate that parts of the project's funds continue to be redirected into new assets, with insiders moving away from memecoins to larger, more established cryptocurrencies like Solana.

Federal Judge Freezes Assets in Argentina, Investigations Intensify

In Argentina, the investigation into the scandal has escalated.

On November 11, federal judge Marcelo Martínez de Giorgi ordered the freezing of over $507,000 in assets linked to Hayden Davis and two local cryptocurrency operators, Favio Camilo Rodríguez Blanco and Orlando Rodolfo Mellino.

Prosecutors estimate that the investor losses in this case range from $100 million to $120 million.

Authorities allege that the trio collaborated with lobbyists Mauricio Novelli and Manuel Terrones Godoy to convert crypto into fiat for Davis and other insiders, forming what they refer to as a “financial den.”

Court documents reveal that various transactions related to the group were traced across Arbitrum, Avalanche, and Solana. Analysts suspect this indicates a coordinated insider scheme.

One particular transaction flagged by investigators involved $507,500 sent through the Bitget exchange just 42 minutes after Milei posted his selfie with Davis.

Prosecutors suggest this transaction may signify indirect payments to public officials, routed through intermediaries to obscure the source of funds.

The ongoing scandal has political implications in Argentina, though the country's anti-corruption watchdog later cleared Milei of any wrongdoing.

Polling by Zuban Córdoba indicates that Milei's approval rating has declined from 47.3% in November to 41.6% in March.

Despite the dip in public support, Milei’s pro-cryptocurrency party, La Libertad Avanza, still performed well in midterm elections, garnering over 40% of the national vote and winning significant regions such as Buenos Aires province.

Analysts observe that the recent transfers, combined with past insider activities around the MELANIA and WOLF memecoins, fit a broader trend of quick token launches, leveraged hype, and swift liquidity withdrawal.