USDC Freeze in LIBRA Scandal: $58 Million Locked Up
Circle, the company behind USD Coin (USDC), has frozen nearly $58 million in two Solana wallets linked to the LIBRA memecoin scandal. This move comes as part of an ongoing legal battle.
On May 29, blockchain analytics firm Arkham reported the freeze. The wallets, tied to the LIBRA deployer and project team, held a combined $57.65 million in USDC. This action was taken by Circle’s multisig freeze authority.
The freeze is related to a class-action lawsuit filed in March in the Southern District of New York. Hundreds of LIBRA investors are suing Kelsier Ventures and its co-founders,Gideon,Thomas,and Hayden Davis. The lawsuit was filed by New York-based law firm Burwick.
Other defendants include Benjamin Chow of Meteora and julian Peh of KIP Protocol.The LIBRA token gained popularity after its February 2025 launch,thanks to Argentine President Javier Milei’s social media promotion. It was marketed as a way to fund small businesses in Argentina.
However,insiders allegedly controlled 70% of the supply and dumped significant amounts within hours,causing the price to plummet over 90%. Insiders reportedly made over $150 million, while investors lost more than $250 million.
The scandal sparked political outrage in Argentina, leading to calls for President Milei’s impeachment. A government task force was established but disbanded by Milei in May 19.
The asset freeze suggests American courts may take immediate action to prevent further losses and ensure compensation for victims. If successful,the case could set a precedent for holding crypto founders and promoters accountable.
