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Argentina’s stock market tumbles amid controversy over Milei’s promotion of $LIBRA

Source Cryptopolitan

On Monday, Argentina’s stock market dropped by over 5.7% after President Javier Milei advertised a little-known crypto, $LIBRA. The crypto crashed shortly after, in a move described by the country’s fintech chamber as a “rug pull.”

The S&P Merval dropped by when markets opened in Buenos Aires Monday. The index, which tracks the biggest companies in the South American country, has since rebounded slightly but is still trading 3% lower than when it closed Friday.

Argentina’s markets have been thrown into chaos after President Milei deleted his X post advertising $LIBRA, clarifying that he has no affiliation with the digital asset. However, the opposition politicians threatened an impeachment trial in Congress following the mishap.

According to Leandro Santoro, who represents the opposition coalition, the president’s post was an embarrassing scandal on an international scale. He argues that such embarrassment requires them to launch an impeachment motion against President Milei.

As a result of the sharp price drop in $LIBRA, over $50 million in long positions were liquidated within just two hours after the news broke (Coinglass, 2025). The Crypto Fear & Greed Index fell from a neutral 50 to a fear level of 35 following this event (Alternative.me, 2025).

The impact extended past $LIBRA because other tokens dependent on the Argentine market such as $PAMPAS fell 4.5% from $0.85 to $0.81 between 9:30 AM and 10:30 AM EST (CryptoCompare, 2025). $PAMPAS trading volume rose by 300% from 2 million to 8 million tokens showing a typical panic selling behaviour (CoinGecko, 2025).

Argentina’s crypto market shaken by alleged presidential misconduct

The $LIBRA token price also fell steeply: from $12.45 to $9.87 between 9:00 AM and 10:00 AM EST, a 20.8% drop in one hour (CoinMarketCap, 2025).

The effect was not only felt on the $LIBRA token but the other cryptocurrencies traded in Argentina also felt the heat with $BTC falling 3.2% from $45,000 to $43,560 and $ETH dropping 2.8% from $3,200 to $3,110 in the same period (CoinGecko, 2025).

The trading volume of $LIBRA increased from 5 million to 15 million tokens in the first hour of the news (TradingView, 2025); this is a clear indication of panic unloading among investors.

Political and economic analysts believe that the opposition does not have enough votes to carry out the impeachment threats. However, the charges, including fraud and the direct role in encouraging crypto, should hurt the government. As Argentina holds mid-term elections this year, this may affect Milei’s result.

First, the president’s action impacted not only the opposition lawmakers but also investors. Most of the investors took to social media and got angry, claiming that he had defrauded them of their hard-earned money. On the other hand, Milei’s supporters are claiming that he is a political witch hunt victim.

ONG Bitcoin Argentina, a non-profit organization that supports local education, said that such irresponsible promotion of assets is a threat to thousands of people. The nonprofit emphasized on education and transparency to protect people from such risks.

During a morning conference, Mexican President Claudia Sheinbaum responded to questions on the scandal, saying the public would have to see the results of the investigations.

It is extremely serious if confirmed, especially in terms of a president’s powers to promote something private. If, as a president of a country, you propose something for private benefit, there is an obvious conflict of interest.

President Claudia Sheinbaum

Milei smells political interference from power-hungry people who mean harm to Argentina

In the last few days, Milei has not become shy about criticism. He came out swinging hard in the face of criticism as he talked of political opportunists. He noted that the “filthy rats” of the political class wanted to fuel the scandal for their political mileage and to do harm. He noted that he is getting more convictions to make them understand that they should not be able to intervene in the events.

The president acknowledged his limited understanding of the cryptocurrency initiative and, upon further investigation, opted to discontinue its promotion.

The scandal happens as Milei is set to visit the United States this week, hoping to meet President Trump. The leader seeks to lobby Trump to support Argentina in getting more resources from the IMF under a new program still under negotiation, including exemptions from Trump’s tariffs.

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