Argentina’s federal judiciary has ordered a sweeping freeze of assets belonging to US promoter Hayden Davis and two alleged intermediaries tied to the collapsed Libra token, deepening an investigation into one of Latin America’s largest crypto scandals.
The order, issued by Judge Marcelo Martínez de Giorgi, reportedly covers digital wallets, bank accounts and real-estate assets of Davis, Argentine operator Orlando Rodolfo Mellino and Colombian trader Favio Camilo Rodríguez Blanco.
Prosecutors said the asset freeze was necessary to prevent the transfer of assets that could represent proceeds of fraud, as investigators work on tracing a money trail estimated to be around $100 million to $120 million.
The ruling directs the National Securities Commission (CNV) to notify all virtual asset service providers in the country, ensuring that the asset freeze is extended to local crypto platforms.
A new development in the LIBRA token scandal
The case centers on Libra, a memecoin that gained traction in February after Argentine President Javier Milei briefly promoted Davis in a social-media post as a blockchain and AI adviser. Within hours, the token surged and then crashed, wiping out about $250 million from more than 40,000 retail investors.
Davis, who also promoted other meme-based tokens, has been cast as the central figure in the memecoin scheme. In May, a US judge in New York froze $57 million in USDC stablecoins tied to Davis and his collaborators at the now-defunct Meteora exchange.
The judge later lifted the freeze, ruling that Davis and former Meteora CEO Ben Chow had not tried to move the funds and that restitution remained possible.
The lawsuit, led by American and Latin-American investors, accuses Davis, Chow and others of coordinating a “rug pull.” Plaintiffs invoked the RICO Act, alleging that Libra and M3M3, another project by Davis, formed part of an ongoing pattern of organized fraud.
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Political and cross-border implications
While no criminal charges have been filed against President Milei, the Argentine investigation drew attention as Davis’s crypto transfers allegedly coincided with high-level political meetings.
Court filings describe intermediaries converting tokens into cash when Davis met Milei at the Casa Rosada, fueling the broader “Cryptogate” controversy that dominated Argentine headlines.
Despite this, Judge Martínez de Giorgi emphasized that the asset freeze will only remain in place as long as necessary to secure evidence and preserve any potential restitution for investors.
The coordinated actions in Buenos Aires and New York mark a rare instance of courts across two continents targeting the same blockchain-based scheme.
For regulators, the Libra scandal highlights how cross-border enforcement and political entanglement are becoming increasingly intertwined with crypto investigations.
Despite being entangled in the scandal, the Milei-led Argentina’s La Libertad Avanza party won the midterm elections, positioning the president as a leading contender for the October 2027 presidential race.
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