A new report released by an investigative committee within Argentina’s Chamber of Deputies outlines extensive findings on the collapse of the Libra token and raises questions about how political endorsement may have influenced investor behavior. The committee concluded that the project’s downfall was not isolated but part of a broader pattern in which public promotion preceded liquidity failures. The report asserts that public encouragement from senior political figures played a material role in accelerating retail participation, particularly following widely viewed social media activity tied to the presidency. Investigators highlighted that multiple wallets associated with the project liquidated substantial positions shortly after retail interest surged, contributing to significant losses for more than one hundred thousand participants. The committee stated that the sequence of events showed indications that institutional safeguards were intentionally bypassed, making the scale of losses and the rapid deterioration of liquidity structurally concerning for any digital asset ecosystem.
The report further notes that similar behavioral patterns appeared in earlier projects, including a protocol launched in late 2024 that experienced an immediate collapse of liquidity pools. The committee pointed to on chain analysis demonstrating how token inflows were converted into other digital assets and distributed among operators shortly after each launch. These findings suggest that multiple initiatives shared common operational structures and that repeated validation from public figures amplified market participation without adequate disclosure of associated risks. The presence of recurring liquidity failures following official endorsement led investigators to argue that oversight bodies had been circumvented during the development and promotion of these initiatives. Analysts monitoring the situation highlight that these patterns underscore critical vulnerabilities related to governance, disclosure and regulatory compliance in retail focused token offerings.
The committee’s conclusions include recommendations for further examination of whether misconduct in office occurred and emphasize the need for increased regulatory control over projects with political or institutional visibility. Lawmakers supporting the report argue that the level of public involvement created expectations among retail investors that were not matched by operational transparency, making the losses particularly severe. Judicial investigations continue to examine the financial flows surrounding the projects, while class action litigation seeks to recover damages for affected participants. Market observers note that the situation may influence how regional regulators approach future digital asset offerings, especially those that involve public endorsements or appear tied to government associated actors. The political dimension of the case adds complexity to an already sensitive regulatory environment that is attempting to reduce systemic risk in emerging token markets while addressing the rise of aggressive promotional activity.
