The insiders who traded the $LIBRA token with privileged information have begun to move the funds. It is an indication that the next phase of the scam is underway.
Digital wallets associated to Kelsier Ventures and its now-infamous CEO, Hayden Mark Davis, have been spotted moving millions of dollars across the cryptocurrency ecosystem in what appears to be a series of transactions aimed at covering their tracks. This is one of the beauties of the blockchain, which is ultimately a public ledger where every transaction is visible. Yet that doesn’t mean that it is easy to track the ultimate beneficiaries of the funds – whether it is members of the Davis clan, other crypto insiders or Argentine nationals.
The usual suspects surface if one looks at the characters who interacted with Davis during his visit to Argentina: Mauricio Novelli, Manuel Terrones Godoy, and Sergio Morales. They were the ones who organised the Tech Forum, a B-level crypto conference sponsored by the government which counted on the presence of President Javier Milei. Novelli, Godoy, and Morales — who has direct ties to Presidential Chief-of-Staff Karina Milei, the head of state’s sister — even got Hayden’s Kelsier Ventures to cough up cash in order to sponsor their conference, around US$500,000, according to some sources, along with other foreign players such as Julien Peh’s KIP Protocol and Bartosz Lipinski’s Cube Exchange. These three firms are said to have signed differing levels of agreements with the Argentine government through which the future of blockchain, Web3 and artificial intelligence products in the country would be conducted and channelled by these players, all of which are considered to be secondary actors in the space. Hayden’s brother Gideon admitted in a podcast interview (that was successively deleted and then uploaded again) that they had advised Cube and managed to get Milei himself to sign a Letter of Intent (LOI) to lead those initiatives on behalf of the government. La Nación’s investigative journalist Hugo Alconada Mon reported that Kelsier’s deal included an initial payment worth US$300,000, followed by monthly installments worth US$250,000 for the following six months, with a potential extension for another two-and-a-half years if they secured deals worth US$10 million or more for the country. None of these contracts have made it into the public sphere, yet.
Hayden and the rest of the involved parties have gone voluntarily mute. After essentially threatening President Milei, by giving him a 48-hour deadline before liquidating the funds, the CEO of Kelsier Ventures asked the head of state’s entourage to reach out to him, indicating that someone from Presidential Spokesperson Manuel Adorni’s office was expected to get in touch. Indeed, Adorni joined the President in his recent trip to the United States to participate in the Conservative Political Action Conference (CPAC), an unusual invitation if compared to previous trips.
Star political advisor Santiago Caputo, the freelancer in charge of the Milei administration’s culture wars, was also brought on board. It wasn’t clear if he was being shielded from the attacks that emerged in the aftermath of his controversial intervention in Milei’s post-$LIBRA scripted interview, during which he cut the recording and instructed journalist Jonatan Viale to skip an uncomfortable question regarding the President’s legal strategy. That fragment was later leaked, leading some to believe that it was a purposeful blow by Grupo Clarín, the media juggernaut which recently acquired the local arm of Spanish telecoms giant Telefónica, much to the administration’s disappointment. From a political perspective, Milei’s trip to Washington was successful in motivating the grassroots followers (in particular his moment in the spotlight when he gave billionaire Elon Musk a pimped-out chainsaw that the newly-minted head of the US Department of Government Efficiency, or DOGE, exhibited to the crowd). They also secured a shout out from US President Donald Trump, who told Milei paternalistically that he is “proud” of him.
The suspicion of a secret meeting between Milei and Hayden Mark Davis or his entourage remains, even though official sources denied it to Perfil. Initially, Milei’s participation in the $LIBRA scam was attributed to ignorance but as investigations have progressed, the prime suspect has become Karina, the President’s de facto gatekeeper and Morales’ political boss. These lines of investigation, along with the movement of funds seen on the blockchain, have been aggressively pursued by a handful of investigative journalists, yet Argentina’s Judiciary continues to drag its feet. Yanina Nicoletti, Hayden’s defence lawyer, has posted on social media criticising the investigation led by federal prosecutor Eduardo Taiano for failing to investigate those “truly responsible” for the $LIBRA scam. Indeed, after sitting on the case for a week, Judge María Servini had delegated the investigation to Taiano, who asked the cybersecurity unit of the prosecution to help him preserve any evidence. While he’s formally investigating whether Milei, Davis, Peh, Novelli, Godoy, and Morales have committed any crime, no formal accusations have been lodged. If evidence had to be tampered with or destroyed, the perpetrators have had ample time to do so.
At the same time, the Milei administration has managed to avoid a Senate investigation into the $LIBRA scandal, while the President has ordered the Investigations Task Force to analyse the case. Interestingly, the taskforce team, which responds to the Executive, will be run by María Florencia Zicavo – chief-of-staff to Justice Minister Mariano Cúneo Libarona, the man who Milei initially suggested would defend him in the courts. Suspicions of previously negotiated impunity go further: Prosecutor Taiano’s son Federico is employed by Guillermo Francos, Milei’s Cabinet chief and Interior minister. It all stays within the circle of trust, it seems.
Milei is doubling down. Not only does he deny any wrongdoing, he’s also trying to push forward with his own agenda to cover up the story. After narrowly avoiding a Senate investigation but failing to get the upper house to consider his picks for the Supreme Court, the government decided to appoint them by decree, sparking a generalised outcry. If he succeeds, the court will go from three members to five, giving the Milei administration a potential majority – Justice Ricardo Lorenzetti pulls out his revenge against colleagues Carlos Rosenkratz and Chief Justice Horacio Rosatti. With the naming of conservative academic Manuel García Mansilla and the controversial federal judge Ariel Lijo, Lorenzetti would control three votes, and could even dream of returning to the presidency of the Court. The libertarian government would go on to control the judiciary and secure their leverage, particularly given legislative weakness and dependence.
Tonight, when he goes to Congress to preside over a Legislative Assembly and deliver a speech kicking off the year’s ordinary sessions, Milei is expected to remain defiant, heralding his successes and attacking his enemies. He’ll brush off accusations of corruption as mere political attacks by his political opponents, while criticism of his decision to appoint Supreme Court judges by decree will be ignored. Milei’s authoritarian tendencies are growing, and he expects to pull through all the way to the midterm elections. $LIBRA still poses a major risk, though – provided any investigation can move quick enough.
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