Cryptocurrency entrepreneur Hayden Davis confessed in U.S. federal court documents that the LIBRA token was merely a memecoin with no legitimate investment purpose, according to filings unsealed this week in the Southern District of New York. Davis explicitly stated LIBRA was designed as "a collectible meme token" without any formal business plan or investment roadmap, contradicting earlier promotional materials that positioned it as an equity-like opportunity.
The admission comes ahead of an August 19 evidentiary hearing that will determine the fate of $280 million in frozen assets connected to the project. Blockchain forensic analysis by Aletheia Labs revealed that during Davis's January 30 meeting with Argentine President Javier Milei at Casa Rosada, a wallet linked to him transferred $499,129 USDC to Kraken exchange. Investigators contend this timing suggests foreknowledge of LIBRA's planned February marketing push.
The token previously surged then collapsed 99.47% within hours of launch, wiping out its $200 million market capitalization. The lawsuit, initiated by investor Omar Hurlock, also names Meteora's Benjamin Chow and Kip Protocol's Julian Peh as defendants. Davis recently filed a 30-page counterclaim arguing Hurlock presented "no concrete evidence of harm" and failed to prove direct victim status.
Judge Marina Torres will oversee next month's hearing, which could establish legal precedents for classifying politically endorsed memecoins. LIBRA had received indirect social media support from President Milei prior to its collapse.