The cryptocurrency token $LIBRA, backed by President Javier Milei, attracted the attention of a large number of cryptocurrency traders. Although initial gains raised the market value of the token to around $4.5 billion, they were short-lived. Hayden Davis, CEO of Kelsier Ventures, admitted that the token was simply a memecoin, despite the initial intention to use it to fund small businesses in Argentina.
A report from the research firm Nansen revealed that losses in the LIBRA token amounted to approximately $251 million, while a minority of traders managed to make combined profits totaling $180 million. Nicolai Sondergaard of Nansen pointed out evidence of privileged beneficiaries taking advantage of the masses that got involved in the cryptocurrency.
The episode raised concerns about the Solana cryptocurrency, the underlying network hosting the LIBRA token and many other memecoins. The value of the Solana token dropped by 20% from Friday to Tuesday's lows, causing a decrease in the total value of tokens locked on the blockchain.
A Bloomberg report based on data from Nansen showed that 86% of cryptocurrency traders who invested in the $LIBRA crypto token ended up losing money. President Milei promoted the token as a way to raise funds for small businesses in Argentina, which triggered the activity of 'snipers' or trading bots that tried to make quick profits from the trend of the new cryptocurrency.
