DWF report: insider trading behind LIBRA coin’s $1.16b rise and fall

Libra (LIBRA) is a meme token on Solana that reached a market capitalization of $1.16 billion within the first hour but soon lost more than 95% of its value. The token’s collapse led to nearly 75,000 traders losing more than $280 million, raising serious questions about insider trading and market manipulation.

The incident, known as “Cryptogate,” has dragged political and financial heavyweights into the controversy, including Argentine President Javier Miley and investment firm Web3 Calsier. According to a report by DWF, there have been allegations that insiders were given access to $LIBRA tokens ahead of the public launch. Kelsey Ventures wallets reportedly made over $110 million by providing liquidity and initial token withdrawals. The scandal has sparked a political backlash against President Miley, with allegations of fraud and calls for a federal investigation and, in some cases, for his resignation.

DWF Labs’ analysis can be seen as a warning sign regarding token launch mechanisms. More advanced approaches to launch, such as Dutch auctions and bootstrapped liquidity pools, would be helpful in leveling the playing field for smaller investors.

Despite this, the $LIBRA and $MELANIA scandals clearly show that despite improved trigger mechanisms, insider access and market manipulation are an unfortunate reality.