Argentinian Market Shaken After President Milei's $LIBRA Advertising Scandal

On Monday morning, the Argentine stock market witnessed a shock as the S&P Merval index opened sharply lower by 5.7% in Buenos Aires. The cause is said to be from a controversial action by President Javier Milei when he posted an advertisement about a little-known cryptocurrency - $LIBRA.

1. Initial Market Shock As soon as the market opened, S&P Merval plummeted, causing panic among investors. Although this index recovered slightly in the following trading hours, it still remained 3% lower than the closing level of the previous weekend trading session.
2. The Decline of $LIBRA and Related Coins Information from CoinMarketCap (2025) shows that the price of $LIBRA has dropped from $12.45 to $9.87 in just one hour - a decrease of 20.8%. Not only that, the trading volume of this coin has surged from 5 million to 15 million tokens, indicating panic selling by investors. The impact of the event does not stop at $LIBRA. According to the report from CryptoCompare (2025), $PAMPAS token - a currency pegged to the Argentine market - has dropped by 4.5%, from $0.85 to $0.81 in just about an hour (from 9:30 AM to 10:30 AM EST). At the same time, the trading volume of $PAMPAS has surged by 300%, from 2 million to 8 million tokens, evidence of strong selling behavior. Other major cryptocurrencies are also not immune to the selling pressure. Bitcoin ($BTC) dropped by 3.2%, from $45,000 to $43,560 and Ethereum ($ETH) decreased by 2.8%, from $3,200 to $3,110 within the same (CoinGecko time period, 2025). The Crypto Fear & Greed index also declined from a neutral level of 50 to a fear level of 35, reflecting investors' very unsettled sentiment.
3. Political Debate Erupts This incident quickly spread not only in the investment community but also in the political circle. Although President Milei quickly deleted the advertisement and asserted that there was no connection to the $LIBRA coin, political opponents argue that this action is a serious fraud, leading to the liquidation of over $50 million of long positions within two hours after the information burst on Coinglass, 2025(. Representative of the opposition, Leandro Santoro, described the President's actions as an “international scandal” and threatened to initiate impeachment proceedings. However, according to political analysts, the opposition currently does not have enough votes to carry out impeachment proceedings, but allegations of fraud and manipulating the cryptocurrency market for personal gain could seriously damage the government's reputation, especially as Argentina prepares for midterm elections this year.
4. Community Reaction and International Opinion On social media, many investors angrily accused President Milei's promotional actions of being fraudulent and undermining their trust in the financial market. Meanwhile, his supporters argue that this is a political witch hunt to tarnish his reputation. The non-profit organization Bitcoin Argentina has warned about the irresponsible promotion of digital assets, stating that this action puts thousands of people at serious financial risk due to lack of education and transparency. In that context, Mexican President Claudia Sheinbaum also stated that the public needs to wait for the investigation results to determine the veracity of the allegations. This statement further raises concerns about the potential abuse of power by a leader in promoting projects that may benefit private interests.
5. Consequences and Future Prospects The incident occurred just as President Milei was preparing for his upcoming visit to the United States to meet with President Trump to garner support for a new IMF aid program, including tariff exemptions. This is a crucial turning point, as investor sentiment and political allegations could significantly impact his credibility and have a negative effect on the upcoming election in Argentina. Furthermore, this event also raises serious questions about the limits of a president's power in promoting private financial products, opening up debates on ethics and responsibility towards the people. Conclusion The advertising scandal of President Milei's $LIBRA has caused a shockwave in the stock market and the cryptocurrency community in Argentina. In the midst of political tensions and volatile investment psychology, both the public and investors are awaiting the investigation results to uncover the root cause of the incident. This also underscores the importance of transparency, financial education, and risk management in an increasingly complex and volatile market. DYOR! )Write&Earn $BTC {spot}(BTCUSDT)