Oh, the drama! The Libra token, a veritable symphony of scandal, is set to take center stage at the Supreme Court of New York. A class-action lawsuit has accused its creators of leading investors on a merry dance, swiping over $100 million from liquidity pools that were, shall we say, a tad one-sided.
Burwick Law, ever the knights in shining armor, filed the suit on behalf of their clients against Kelsier Ventures, KIP Protocol, and Meteora on March 17. They allege the Libra (LIBRA) token was launched with all the subtlety of a bull in a china shop — “deceptive, manipulative, and fundamentally unfair.” Even the Argentine President Javier Milei got in on the act, promoting it on X as an economic miracle cure.
The law firm didn’t hold back, slamming KIP and Meteora for using a “predatory” liquidity pool to inflate the memecoin’s price like a balloon at a children’s party, allowing insiders to profit while the everyday buyers were left holding the bag.
And the plot thickens! Within hours, insiders allegedly made off with approximately $107 million from the liquidity pools, causing LIBRA’s market value to crash by 94%. A dramatic tumble, indeed.
President Milei was mentioned in the lawsuit, but luckily for him, he wasn’t named a defendant. Phew!
Burwick accused the defendants of using Milei’s influence like a puppet on a string, aggressively promoting the token and creating a false sense of legitimacy that would make a magician blush.
Approximately 85% of LIBRA’s tokens were withheld at launch, and the “predatory infrastructure techniques” allegedly used by the defendants were as transparent as a brick wall, Burwick said.
“These tactics, combined with omissions about the true liquidity structures, deprived investors of material information.”
Burwick is seeking compensatory and punitive damages, the disgorgement of “unjustly obtained” profits, and injunctive relief to prevent further fraudulent token offerings. They’re not playing around.
Data from blockchain research firm Nansen found that of the 15,430 largest Libra wallets it examined, over 86% sold at a loss, combining for $251 million in losses. Ouch!
Only 2,101 profitable wallets managed to take home a combined $180 million in profit, Nansen noted in a Feb. 19 report. The lucky few!
Kelsier Ventures and its CEO, Hayden Davis, were apparently two of the biggest winners from the token launch, claiming to have netted around $100 million. A tidy sum, indeed.
Davis, who is now facing a potential Interpol red notice (oh, the drama!), said on Feb. 17 that he didn’t directly own the tokens and wouldn’t sell them. How convenient!
Meanwhile, Milei has been doing a little dance of his own, distancing himself from the memecoin and arguing he didn’t “promote” the LIBRA token — as fraud lawsuits filed against him have alleged — but merely “spread the word” about it. A fine line, indeed.
Argentina’s opposition party called for Milei’s impeachment but has had limited success thus far. The show must go on!
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2025-03-18 08:43