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The past week has been quite intense regarding the relationship between politics and meme currencies. It seems that Solana is the right place for coins that have gained popularity because of their drastic fall, such as MELANIA or TRUMP, to have become quite a spectacle, but also to represent what we should not invest in, at least if we are not experienced enough to come out in profit.
On both occasions, these currencies plummeted between 65 and 85%, which means that only a few could have benefited from this, in my assumption if they entered this market in time, or if they participated in a short projection. Recently we have seen that the new currency LIBRA, has followed the same step into the abyss after reaching a market capitalization of $4 billion, with the difference that the president's participation is linked as a scam, with charges of fraud being filed, although we understand that this is a situation where the opposition will seek to take advantage.
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To put ourselves in context, we should know that the Argentine president, Javier Milei, has been the protagonist of a major mistake, participating in the promotion of a currency called LIBRA, without being aware of what was being disclosed. If we go back to one of the beginnings that matters most to us, it was when, in January, a meeting was held with those representing KIP Protocol. This company would serve as the basis for the development of projects such as “Viva La Libertad”, with which it would be possible to finance private projects through blockchain technology. Julian Peh, CEO of the company, participated in that meeting, as well as, later in another meeting, Hayden Mark Davis, a partner who has been selected by the project, pointing out the benefits of this infrastructure.
At this point, one can understand that the objective was different, but in the course of the meeting things happened that were not planned, and in my particular opinion, the mistake is in not delving into the cryptocurrency that had been launched, nor what plans were behind it.
A blockchain analysis firm called Bubblemaps, in collaboration with Stephen Findeisen, who is referred to as “CoffeeZilla”, has found traces of evidence that the company mentioned above has been responsible for having any links to the LIBRA and MELANIA tokens. In many cases it happens that, when a political event is gaining a lot of repercussion, coins are created on which the market can bet, and which definitely fall in favor or against those who are running. This is a similar case in which we do not know who launched this token, whether it was an individual or a small group. What is certain is that the mistake was in backing it without really knowing where the initial liquidity came from.
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The investigation led to very interesting results, in which the profits of one of the schemes made it possible to finance the other. For this purpose, funds had to be transferred in series, through the Solana and Avalanche chains, and vice versa. If we go into the details, we can say that there was a Solana wallet called “P5tb4”, which managed to accumulate a value of $2.4 million dollars after MELANIA's trading activity, to be later moved to another Avalanche wallet, under the denomination “oxcEA”, which is the creator of the token. On the other hand, these funds departed from this wallet to another one named “DEfcyK”, which according to the Solscan block explorer, identifies this one as the creator wallet of the LIBRA token. Thus, we can find a strong relationship between both projects, which will surely generate more doubts.
Another firm that joined alongside Bubblemaps was ChainAnalysis. Both were able to detect suspicious activity when they noticed that 82% of the supply was held by only one group of wallets. This could also mean that a single person is holding power over these wallets, which refers to being able to withdraw an abysmal amount of liquidity. This made those who had investments on this cryptocurrency, prefer to sell their positions, and as if it were the effect of gravity, the price plummeted by 89%. We should mention that before this fall, there was also an explosive rise, which may refer to profits for a few. In fact, some $87 million in USDC and SOL coins have been withdrawn.
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After this scandal, the presidential office decided to take action. Something we must highlight is that the decision to create an “Investigation Task Force” was led by the president himself, which reaffirms the position of transparency and total determination in the clarification of the facts. To this end, the investigation will be carried out by agencies dealing with crypto-assets, money laundering and other financial operations. At this point, justice will have elements to determine whether companies or individuals belonging to KIP Protocol were responsible.
