Crypto scandal in Argentina: Trust in Milei collapses

Javier Milei's popularity plummeted after his involvement in the LIBRA crypto scandal, causing severe losses for investors and federal investigations.

According to a survey by Zuban Córdoba, 57.6 per cent of respondents have lost confidence in Argentine President Javier Milei, marking a sharp decline in public trust.

His controversial involvement in the LIBRA cryptocurrency scandal has triggered this drastic decrease in trust, after it caused huge financial damage to many investors.

The poll, conducted between 12 and 14 March, collected the opinions of 1,600 individuals, reaching a 95% confidence level with a margin of error of 2.4%. The research shows growing public disenchantment with the current administration, with a steady increase in negative opinions over time.

"Negativity is growing slowly but steadily, with no apparent limit. The change in tone and assessment of government is consolidating as more and more problematic issues emerge on the political agenda. One bloodbath after another could be the theme of the last few months," reads the report.

More than a month after the crypto scandal emerged, only 36% of respondents said they still had confidence in President Milei, while 6.4% remained undecided. According to this data, Milei's reputation and public standing suffered a severe blow. A significant proportion of the respondents viewed him negatively (58.5%), compared to 41.1% who still viewed him favourably, signalling a clear deterioration of his public image.

The Milei administration is receiving mixed reactions from the public: 58.4% disapprove of his leadership, while 41.6% continue to support him.

The LIBRA scandal exploded on 14 February, when Milei promoted a new cryptocurrency with a post on X (formerly Twitter), which was later deleted. The token's market value quickly soared, reaching a capitalisation of more than $4 billion, but plummeted by 95% when initial investors and some alleged insiders liquidated their holdings.

The blockchain analytics firm Nansen revealed that insiders and bots made $180 million in profits, while 86% of LIBRA investors reported losses totalling $251 million. LIBRA's collapse led thousands of investors, supporters of Milei, to face devastating losses.

Milei stated that his involvement with LIBRA was limited to sharing information about the project and denied any form of official endorsement. However, his explanation failed to quell public anger or reduce legal attention to the case.

After the scandal, Argentine authorities launched a federal investigation into the president's involvement, while numerous criminal charges were filed against Milei and his associates.

Despite the reputational damage, Milei's La Libertad Avanza party retains the first position in the electoral polls for the 26 October vote, with 36.7% support, while the opposition coalition Unión por la Patria stands at 32.5%. The scandal has severely damaged Milei's image, but his political movement remains solid.