One article to clarify LIBRA token scam: From presidential endorsement to hacker tracking

Author: Yuliya, PANews

Since Trump issued the coin on January 18, Pump.Fun’s zero-threshold coin issuance mechanism has gradually exposed two aspects: on the one hand, it injects liquidity into the market, and on the other hand, it also provides a breeding ground for the breeding of black and gray industries. The hidden dangers brought by this mechanism are getting bigger and bigger, and of course it also provides hackers with more profitable wealth opportunities. (Stolen social account and give a CA) Congratulations on not delving into the project, you have successfully gotten on board.

On February 15, Argentine President Milei's high-profile support for LIBRA tokens on social media, pushing the project, whose market value once soared to $4 billion, to its peak. However, after Milei suddenly deleted the tweet and issued a clarification statement, the LIBRA token showed a cliff-like plunge, with the lowest market value shrinking to US$130 million, evaporating 96% from its peak. According to people familiar with the matter, as early as a week before the token issuance, there was news that someone bribed $5 million to senior officials around President Milei in exchange for Milei's public support. This change has caused the market's enthusiasm for meme coins to fade sharply, and the Pump.Fun craze that lasted for a year is fading. Platform agreement fees have dropped sharply from the historical peak of 72,506 SOLs on January 1, with only 11,188 SOLs per day.

Accidentally angered the top white hat hacker

When KIP Protocol high profile announced the launch of the "Viva la Libertad" project and showed off the success of the token $LIBRA, it claimed that the project was led by private businesses and had nothing to do with Argentina President Milei, however the statement was quickly slapped in the face.

Chaofan Shou, co-founder of Fuzzland, began to bombard KIP Protocol, calling out "RNM, refund the money!" He cried and Solayer engineer @tonykebot lost more than $2 million in the LIBRA project, and revealed the core of KIP Protocol, the team behind LIBRA. The list of members, claiming “Let’s see what two hackers and an idle weekend can bring to us”, suggests action will be taken. (It is reported that Shou enjoys a high reputation in the field of cybersecurity. His team has successfully recovered more than $33 million in stolen funds and has a vulnerability bounty in the field of Web2 security for more than $1.9 million.)

In the next few days, Shou and KIP Protocol co-founder Julian had an online "fight" on Twitter. Julian said, "If the project is really rugged, come to me. It's your problem that you lose money. It means the project party is rubbished.” In response to this, Shou made a harsh statement saying that he would investigate the relevant responsible persons, "No one from Vietnam to Singapore and then to the United States will be able to run away." Immediately, Shou revealed Julian's personal identity information and said bluntly, "No matter whether you refund the money or not, you will run away." He warned that "a $200 million case may face a 50-year prison term in the United States, so I advise you to go back to Singapore as soon as possible." Although running away is really hateful, the editor believes that it is inappropriate to disclose someone else's identity before you know the result.

Uncover the true face of the project party

After such a stir in the market, many Solana ecological projects have expressed their "no me" and have cleared their relationship with LIBRA. Meteora co-founder Ben Chow said he never bought, received or managed any LIBRA tokens; Jupiter co-founder Siong also said he did not work with projects such as $LIBRA and $ENRON to do evil.

A survey by blockchain analytics firm Bubblemaps shows that LIBRA is closely related to the previously controversial MELANIA token project. The early sniper wallets of the two projects are highly overlapping, and both adopt a similar "pump and dump" technique.

• Transfer funds between different public chains using cross-chain protocol (CCTP)
• "Snap transactions" through multiple associated wallets
• About $87 million was drawn from liquidity pool

In an interview with YouTube blogger Coffeezilla, Hayden Davis admitted that the team conducted sniper transactions at the start of both LIBRA and MELANIA projects, but emphasized that the original intention of the operation was to protect project liquidity rather than profit from it. The core members of the LIBRA project include:

• Hayden Davis (founder of Kelsier Ventures)
• Julian Peh (founder of KIP Protocol)
• Mauricio Novelli (Argentina Science and Technology Forum)
• Manuel Godoy (Argentina Science and Technology Forum)

Hayden said that LIBRA's issuance of coins was not "cutting leeks", but the market collapsed due to the failure of the plan. He currently has $100 million in funding and is looking for solutions. He revealed that sniping operations have become a common phenomenon in the meme currency field, and most projects will be used by insiders or high-frequency traders during the issuance stage.

Event reflection

The chain reaction caused by the event continues to ferment:

• Market level: Bitcoin market share climbed to a four-year high of 60%. QCP Capital analyzed that the "run away" scandal in the LIBRA project may curb the altcoin and Meme currency market for a long time;
• Judicial level: At present, the Argentine government has established an inter-departmental investigation team to jointly investigate the case with financial regulatory and anti-money laundering agencies. Former central bank governors and others have filed lawsuits accusing Milei of playing a key role in the project and suspected of fraud;
• Industry Reflection: Zhu Su, co-founder of Sanjiang Capital, believes that the main mistake of the Libra team is to withdraw from the Meteora liquidity pool and perform short-term arbitrage operations, otherwise it will run similarly to the TRUMP token.

This cryptocurrency drama that combines political endorsement, hacker confrontation and capital manipulation has exposed three real dilemmas in the Web3 world:

• Government endorsement does not mean that the project is credible
• Insider trading and market manipulation are still common in cryptocurrency markets
• Community autonomy forces, especially the participation of technical experts, may be more effective than traditional regulation