Federal Judge Targets Key Figures as Cross-Border Investigation Expands
Argentina has intensified its investigation into the Libra token scandal, ordering a comprehensive asset freeze against U.S. promoter Hayden Davis and two alleged intermediaries accused of orchestrating one of Latin America’s largest crypto frauds.
Argentina Freezes Digital and Real Assets
The move, issued by Judge Marcelo Martínez de Giorgi, targets digital wallets, bank accounts, and real estate linked to Davis, Argentine operator Orlando Rodolfo Mellino, and Colombian trader Favio Camilo Rodríguez Blanco. Authorities said the freeze is essential to prevent the movement of assets possibly tied to fraudulent proceeds.
Prosecutors estimate the money trail at between $100 million and $120 million, and the National Securities Commission (CNV) has been instructed to alert all local crypto service providers to extend the freeze to domestic exchanges.
“The measure ensures that funds cannot be dissipated while investigators pursue restitution for victims,” a judicial source familiar with the case said.
The Libra Token Collapse
At the heart of the scandal lies Libra, a memecoin that exploded in popularity in February after Argentine President Javier Milei briefly endorsed Davis as a blockchain and AI adviser on social media. Within hours, the token soared and then crashed, erasing about $250 million from more than 40,000 investors.
Davis, who has a history of promoting speculative crypto assets, is portrayed as the central architect of the scheme. Earlier this year, a U.S. court in New York froze $57 million in USDC tied to Davis and associates at the now-defunct Meteora exchange, though the freeze was later lifted.
Cross-Border Legal Pressure
The joint actions in Buenos Aires and New York mark a rare example of cross-continental cooperation in a blockchain fraud case. Plaintiffs representing both U.S. and Latin American investors have invoked the RICO Act, alleging that Davis and his partners coordinated an organized “rug pull” through Libra and other tokens such as M3M3.
While no charges have been filed against President Milei, court documents note that Davis’s crypto transfers appeared to coincide with meetings at the Casa Rosada, sparking a broader “Cryptogate” debate in Argentine politics.
Judge de Giorgi clarified that the asset freeze will remain temporary, ensuring investor protection while evidence is secured.
The Libra probe underscores how crypto enforcement is increasingly entangled with political and cross-border dynamics. Analysts say the case could serve as a test for regulatory coordination between the U.S. and Latin America as both regions confront the challenges of policing digital-asset frauds.
With the scandal still unfolding, Argentina’s judiciary has signaled that no figure or entity will remain beyond scrutiny in its pursuit of accountability in the country’s most explosive crypto case to date.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.