By According to a Chainanalysis report, a pair of wallets related to the token’s developers lost around $99 million in investment liquidity for the LIBRA token.
The blockchain research group, which released its report on Wednesday, revealed this information, tarnishing the token’s reputation even more and raising concerns among investors.
According to a Reuters report, Chainalysis noticed that eight cryptocurrency wallets related to the team that created LIBRA withdrew big amounts from the token liquidity pool.
The firm said it couldn’t identify who owned these wallets but said these wallets that directly received tokens from the LIBRA development group have piqued its interest for possible misconduct.
The dark side of meme coins
A Solana-based meme coin is in the spotlight following a slew of claims it could be a target of a pump-and-dump scam, an infamous scheme that sees developers inflate the price of a coin to lure in new buyers and then cash out leaving the project shell in their wake.
On-chain analysis firm Nansen put a bad light on this token, stating that a whopping 86% of traders lost around $251 million on this token.
In contrast, the other traders reportedly took the balance, making about $180 million in profits on allegedly boosted bids, calling into question the fairness of trading around LIBRA.
Meme coins are often discarded based on their attractiveness rather than their value, leading to their negative reputation.
LIBRA’s temporary success and subsequent downfall highlight the perils of investing in such volatile assets.
Political fallout: Argentina’s opposition seeks impeachment of Milei.
The political fallout from the LIBRA scheme has made it to the top office as Argentine President Javier Milei faces calls to resign.
The financial devastation has led to calls for impeachment and even criminal charges against President Milei, whose promotional posts on social media platform X led to a frenzy around LIBRA-based currency.
Milei defended himself by claiming he never recommended the coin in an official capacity and that any investors did so at their own risk.
But the implications of this case go further than the crypto sector, reaching into governance and raising ethical questions about political promotion and financial products.
Constituents are demanding accountability from Milei regarding his role in promoting LIBRA.
CEO’s admission of withdrawal and plans
Hayden Davis, CEO of Kelsier Ventures and LIBRA project advisor, admitted to withdrawing roughly $100 million from the LIBRA liquidity pool and managing those assets, according to on-chain investigator CoffeeZilla.
However, he stated that he did not wish to profit from these withdrawals.
This raises concerns regarding transparency, the reasons for withdrawals, and how investors’ funds are spent.
Market impact and current performance
The market has had a strong reaction to the ongoing issue.
LIBRA is currently trading at $0.2333, down 15% within the past 24 hours.
The token’s 77% slide from its high indicates a loss of investor trust and increased volatility in the cryptocurrency industry.
Investors and stakeholders are monitoring the situation’s progress.
The introduction of the LIBRA coin highlights the importance of regulation and consumer protection in the cryptocurrency industry.
This incident will have long-term repercussions for the world of digital currency, beyond only the LIBRA initiative.
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