LIBRA Token's Hayden Davis Denies Rug Pull Claims, Cites 'Plan Gone Wrong'

How a Crypto Experiment Turned Into a $4.6 Billion Disaster

Hayden Davis, a central figure in the LIBRA token launch, insists that the project’s downfall was the result of a plan that spiraled out of control rather than outright fraud. Despite LIBRA’s catastrophic 90% collapse, wiping out more than $4.6 billion within 24 hours, Davis claims he remains in possession of $100 million in project funds with no clear direction on what to do with them. 

The fallout has sparked widespread accusations of insider trading and political misconduct, particularly after Argentinian President Javier Milei’s February 14 endorsement triggered a speculative rush just before the token’s implosion. In a bid to distance himself, Milei quickly deleted his post, but the damage was already done—investors who mistook his backing as official government approval poured money into the asset, only to see it evaporate overnight.

The fallout has extended beyond the crypto sphere, with Milei now facing mounting legal challenges and impeachment threats. Opposition leaders accuse him of enabling a pump-and-dump scheme that misled thousands into thinking LIBRA was a state-supported venture. 

Cristina Fernández de Kirchner, a key political rival, lambasted Milei, stating that "some made fortunes due to privileged information while thousands lost everything." Legal complaints have been filed, alleging Milei engaged in an "illicit association to commit fraud," a claim his office strongly denies, dismissing the promotion as a routine announcement that was later deleted to prevent market speculation.

Behind the scenes, blockchain data paints a picture of a deeply entangled web of market manipulation. On-chain analysis from Bubblemaps reveals LIBRA's connections to other controversial memecoins, including MELANIA, ENRON, and BOB, suggesting a coordinated scheme designed to exploit retail investors. A wallet linked to MELANIA was found to have funded LIBRA’s launch, reinforcing concerns that the same insiders have been orchestrating multiple token schemes. 

Further complicating the situation, one wallet executed a staggering $6 million snipe on LIBRA while withdrawing $87 million in liquidity—moves that hint at carefully planned insider trading. While Davis has denied personal profit-taking, claiming, "We didn’t take any liquidity out. Zero," the evidence of internal sniping by LIBRA’s own team raises questions about the true extent of manipulation behind the project.

The scandal’s ripple effects have also reached the international stage, threatening Milei’s credibility as he engages in critical negotiations with the IMF and the U.S. government over financial aid and trade tariffs. Bloomberg reports suggest that Milei was actively involved with LIBRA before abruptly pulling support, further fueling doubts about his economic leadership. Critics argue that the fiasco exposes deeper flaws in his financial strategy, undermining Argentina’s already fragile position in global economic discussions.

Davis, now the de facto custodian of the remaining $100 million, faces mounting pressure over how to handle the funds. While potential solutions range from full refunds to affected investors to donations to an Argentine nonprofit, the possibility of reinvesting the funds into LIBRA raises new concerns about another potential trading frenzy. “If I announce the money is going back in, every trader with a brain is going to buy the dip and profit off it,” Davis acknowledged, hinting at the risk of triggering another insider-driven market event.

Meanwhile, the broader crypto community has begun responding to the crisis. Binance founder Changpeng Zhao (CZ) pledged 150 BNB, worth roughly $100,000, to aid Argentine students impacted by LIBRA’s collapse. 

Additionally, crypto influencer EnHeng has launched a $50,000 relief fund for affected victims, prioritizing students who can provide wallet addresses and proof of their losses. While these efforts offer some relief, they do little to mend the severe reputational damage caused by LIBRA’s implosion or restore trust in a market still plagued by manipulation and political entanglements.

This article has been refined and enhanced by ChatGPT.