Argentina Drops Criminal Probe Into Milei Over Collapsed Cryptocurrency Scandal

An Argentine federal judge has dismissed a criminal investigation into President Javier Milei and his sister Karina Milei over a cryptocurrency scandal that saw investors lose millions after a digital token crashed. Federal judge Marcelo Martinez de Giorgi issued the ruling on Friday, ending months of scrutiny into the president’s role in promoting the $Libra token, which collapsed shortly after a brief rally in early 2025.

“The reported events do not constitute a criminal offence,” the judge wrote in his decision, according to court records. He concluded that investor losses and the dramatic rise and fall in the currency’s price were insufficient to establish fraud. The ruling marks a significant legal victory for Milei, who has faced intense political pressure since the scandal erupted in February 2025.

In his ruling, Martinez de Giorgi acknowledged that Milei’s institutional standing as president could have given the cryptocurrency launch “greater impact” when he posted about it on social media platform X. However, the judge emphasized that this influence does not, in itself, translate into a fraudulent scheme. The decision effectively clears the Argentine leader of any criminal wrongdoing in the matter, though questions about judgment and transparency remain in political circles.

Presidential Promotion Triggers Brief Rally and Rapid Collapse

Javier Milei recommended the little-known meme coin in a post on X in February 2025, telling followers it would help fund small businesses and start-ups. The cryptocurrency’s price shot up immediately after the Argentine president shared a link to purchase it, drawing thousands of investors eager to participate in what appeared to be a presidentially endorsed venture. Within hours, however, Milei deleted the post and publicly denied any connection to the cryptocurrency, whose value soon plunged dramatically.

The sudden collapse triggered accusations of a “rug pull” from critics and opposition lawmakers, a term used in cryptocurrency circles to describe schemes where promoters draw in buyers only to stop trading activity and disappear with investors’ funds. Blockchain researchers reported that approximately $99 million worth of cryptocurrency was withdrawn from the marketplace by eight digital wallets linked to the token’s creator, raising immediate red flags about the project’s legitimacy.

At the time of the currency’s crash, Milei defended his actions by insisting he had acted “in good faith” and accused political rivals of attempting to exploit the situation for political gain. “I was not aware of the details of the project and once I found out, I decided to not continue giving it publicity,” the president stated in a television interview with Todo Noticias.

Investigation Includes US Businessman and Presidential Sister

The judge also dismissed the investigation into US businessman Hayden Davis, who described himself as a “launch adviser” for the token and who reportedly held close to $100 million after the crash. Davis has consistently denied any wrongdoing throughout the investigation, maintaining that all activities related to the token launch were conducted legally and transparently.

Karina Milei, the president’s sister and General Secretary of the Presidency, was also cleared in the ruling. Her inclusion in the investigation stemmed from her influential position within the administration and questions about whether she had advance knowledge of her brother’s promotion of the cryptocurrency. The judge found no evidence linking her to any fraudulent activity or coordination related to the token launch.

“For the first time in history, a President of the Nation was investigated with complete freedom, resulting in absolute proof of his innocence,” read a post shared on X by the official presidential office. The statement continued with a pointed question aimed at the president’s critics: “Who will take responsibility for having wasted Argentine taxpayers’ money and the President of the Nation’s time in a failed attempt at an institutional coup?”

Political Fallout and Impeachment Threats

The scandal prompted opposition members of Congress to plan impeachment proceedings against Milei, though these efforts appear to have stalled following the judge’s ruling. Argentina’s fintech chamber raised concerns at the time that the case could damage the country’s growing cryptocurrency sector and undermine investor confidence in digital assets. The chamber stopped short of directly criticizing the president but called for clearer regulations governing public officials’ involvement in cryptocurrency promotions.

During the height of the controversy, Milei maintained that investors who purchased $Libra had done so “voluntarily” and were aware of the inherent risks in cryptocurrency markets. He defended his decision to delete the promotional post by explaining that once he learned more details about the project, he concluded it was inappropriate to continue endorsing it publicly.

Close Alliance With Trump Administration

Javier Milei remains one of US President Donald Trump’s closest international allies, with Trump describing him as his “favourite president” during a White House lunch last year. The American president firmly backed Milei a year ago, though he made clear the support hinged on electoral victories for Milei’s party in Argentina.

“I’m with this man because his philosophy is correct,” Trump stated ahead of the meeting. “If he wins, we’re staying with him. And if he doesn’t win, we’re gone.” The relationship between the two leaders has been characterized by shared economic philosophies emphasizing deregulation, reduced government spending, and free-market principles.

The cryptocurrency scandal has not appeared to damage the relationship between the two administrations, with US officials remaining publicly supportive of Milei throughout the investigation. The Argentine president continues to pursue aggressive austerity measures domestically while maintaining close diplomatic ties with the Trump administration on issues ranging from trade to regional security.