Milei's Crypto Bribery Scandal Derails Argentina's Digital Investment Ambitions
Argentinian President Javier Milei is confronting his lowest approval ratings since assuming office in 2023, as newly disclosed evidence allegedly uncovers a $5 million financial agreement tied to his public endorsement of a controversial cryptocurrency project last year. This scandal has severely damaged the reputation of digital currencies across Argentina and hindered the aspirations of industry insiders who viewed the nation as a promising frontier for crypto growth.
The $Libra Controversy and Its Fallout
On 14 February 2025, Milei tweeted his support for the $Libra token, a niche cryptocurrency that claimed to "boost the growth of the Argentinian economy." Following his endorsement, $Libra's price surged to a peak of $5 before rapidly collapsing to under $1, erasing $250 million in investments from 13,000 token holders. The revelations of a financial agreement, first published by the investigative outlet El Destape, contradict Milei's assertion that he had no connection to $Libra's organizers and had independently decided to promote it.
According to reports from La Nación, call logs indicate that the president communicated with crypto lobbyist Mauricio Novelli at least five times just before promoting $Libra. At that time, Novelli was in Texas with colleagues involved in the project, including an American crypto entrepreneur whom Milei had allegedly agreed to appoint as an adviser under the terms of the financial arrangement. The agreement, recovered from Novelli's cellphone by state investigators, reportedly outlines payments of $1.5 million, $1.5 million, and $2 million made in three phases to entities linked to Milei.
Economic Context and Regulatory Slowdown
Milei's promotion of cryptocurrency and the ensuing uproar over his alleged multimillion-dollar bribery occur against a backdrop of grim economic realities for everyday Argentinians. The libertarian president has implemented strict austerity measures to combat once-rampant inflation, which triggered a recession and left many in poverty. While the country is beginning to recover, the optimistic outlook of crypto enthusiasts, including the president, clashes with on-the-ground conditions. In response, regulators have slowed the integration of crypto into the mainstream financial system.
Prior to these recent disclosures, Argentinian crypto advocates and international figures had attempted to frame crypto-focused education and regulation as methods to prevent future scams. Their efforts to reshape Argentina's regulatory landscape now face a steeper uphill battle, with crypto's public image intertwined with Milei's alleged corruption and nosediving public approval—though Milei has previously bounced back from scandals.
Devconnect and Efforts to Rehabilitate Crypto's Image
Less than a week after Milei's promotion of $Libra in 2025, with political opponents loudly calling for an official investigation, Ethereum founder Vitalik Buterin issued a direct appeal to Milei via social media. Buterin argued that "recent news" demonstrated "why education is so important" and suggested that hosting Devconnect—the inaugural "world's fair" for Ethereum investors, developers, and supporters—in Argentina "could be a great opportunity to show the best of what crypto can offer." Milei responded on X an hour later, framing the convention as a "great opportunity" and "an honor for Argentina."
Following Milei's election in 2023, which brought a libertarian and pro-crypto politician to national office, crypto advocates saw an opportunity to expand crypto's footprint in a country desperate for investment. They viewed Argentina's unstable political and economic conditions as a "perfect storm," with inflation driving the national currency down against the dollar and compelling many consumers to turn to crypto as a less-volatile store of value. In 2024, Argentinian crypto entrepreneurs established Crecimiento, now the primary crypto-advocacy group in the country, aiming to secure business-friendly regulatory changes.
Members of Argentina's crypto sector stated that Milei's $Libra scandal had harmed crypto's reputation. They saw Devconnect as a high-profile opportunity to redeem the sector's public perception by showcasing "the other side of crypto," which could encourage regulators to return to the table and implement favorable reforms. According to Emi Velazquez, an entrepreneur and former director of Crecimiento, the organization's presence in Argentina helped capture Devconnect's attention, with at least one member securing preferential visa status for attendees—a crucial factor in deciding the conference's location.
Milestones and Ongoing Challenges
Leading up to Devconnect in November 2025, organizers and local crypto platforms attempted to spur adoption. Salespeople for crypto apps encouraged restaurants and other businesses to accept crypto payments before Devconnect's crypto-wealthy attendees flocked to Buenos Aires, with these outlets listed as crypto-friendly venues on the official travel guide. The conference ultimately drew over 17,000 attendees globally, with Ethereum leaders, including Buterin, delivering keynote addresses. Buterin's speech highlighted how Ethereum differs from FTX, criticizing the now-bankrupt exchange and its jailed founder, Sam Bankman-Fried, for "currying favor with politicians."
According to Maria Milagros Santamaria, who previously led Crecimiento's regulatory efforts, crypto's status in Argentina over the past two years has been tied to three milestones. The first was the start of the $Libra scandal in February 2025, which prompted some regulators to retreat from crypto-related rule-making discussions. By Devconnect in November, the second milestone, most regulators had returned to the table, and Argentina's securities regulator had begun overseeing a regulatory sandbox for crypto initiatives and fintech startups.
The third milestone, the most recent tranche of evidence concerning Milei's role in the $Libra scandal, has compromised crypto's momentum in the country. Santamaria noted that Argentina's central bank was slated to begin allowing banks to offer crypto services in April, but the status of that rollout remains unclear. She added that Argentina's financial regulators often follow American approaches, making a full pause on the sector's expansion unlikely. On 7 April, Argentina's securities regulator recognized some cryptocurrencies, including ether, as counting toward investors' personal net worth, effectively allowing crypto investors to access more sophisticated financial products.
Crypto advocates feel "disbelief and disappointment" in reaction to Milei's alleged ties to $Libra, Santamaria said, with entrepreneurs still "trying to build on top of [the scandal] and keep showing what we can do." The president has seen his public approval ratings drop sharply on other occasions, only to rebound, leaving his long-term political prospects uncertain. "Maybe a prediction market would help on that one," she remarked.
