LIBRA showed us how the memecoin sausage is made — it’s gross
A memecoin scandal involving Argentine president Javier Milei has revealed the inside game
Argentine president Javier Milei | Shutterstock/Matias Lynch modified by Blockworks
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In The Prestige, Michael Caine’s character John Cutter is a veteran illusion architect who knows how the magic sausage is made better than most.
As it goes, there are three parts to every great magic trick. And it actually runs analogous to LIBRA, the colossal screwup of a memecoin initially endorsed by renegade Argentine president Javier Milei.
- “The Pledge” involves the magician showing the audience something ordinary, like a deck of cards, or in crypto’s case, a Solana memecoin.
- “The Turn” sees the magician take that ordinary thing and make it do something extraordinary — like disappear (in LIBRA’s case, pump to a $4.5 billion market cap).
- “The Prestige” involves returning the thing from the ether to complete the illusion. “Because making something disappear isn’t enough; you have to bring it back.”
LIBRA is stuck between stage two and three. After doing 20x in its first hour alongside Milei’s endorsement, LIBRA spectacularly crashed 97% over the next seven and is yet to rebound in any meaningful way.
The bulk of the collapse occurred as project insiders dumped upwards of $87 million worth of LIBRA, as tracked by Bubblemaps, leading Milei to distance himself from the project and order an official investigation.
Instead of illusion ingénieur John Cutter spilling the beans on magic, we have memecoin fixer Hayden Davis, also known as Kelsier, telling us exactly what occurs behind the curtain.
Davis, in an interview with Coffeezilla overnight, described himself as the “launch strategist” for LIBRA, MELANIA and others. He says he’s now fearing for his safety and is unsure of what to do with all the money.
As Davis put it, anyone launching a memecoin in 2025 must fight against unseen forces that nobody has figured out how to beat: onchain snipers who will bid up fresh memecoins at the drop of a hat, only to dump them soon after on anyone buying into the pump they created, usually killing the project in the process.
Which is why Davis opted to snipe LIBRA and MELANIA first — max bidding tokens on the way up and unloading them on the way down, with the supposed intention to rebuy the token once again after the initial wave of external snipers had unloaded their clips.
“Every single time, the snipers walk away with $80 million, $100 million, $200 million, and they just disappear. Meanwhile, the project gets blamed, and so do I,” Davis told Coffeezilla.
“So do I think that sniping is the most ethical thing in the world? No. But do I think that anyone has figured out a better way to deal with it? Also no. If anyone has a better solution, I’d love to hear it. But nobody has given me one.”
It all makes fertile ground for an insider cabal to profit in secret, while the general public — albeit cognizant that they’re gambling in an onchain casino — is largely unaware of the rules of the game.
Davis, if he were Michael Caine starring in a crypto version of The Prestige, would say that the restorative third act LIBRA would involve imbuing it with some utility, magically turning it from empty memecoin into “SocialFi” offering with some intrinsic value.
“Like, imagine if you had big influencers, big figures like Dave (Portnoy) getting involved, and these tokens started cross-promoting each other, burning tokens, adding utility,” Davis said. “Then maybe there’s an actual chance that these projects could become part of a real SocialFi ecosystem.”
Dave Portnoy actually lost $5 million trading LIBRA, which Davis says he directly refunded shortly after.
In the meantime, Davis, who said he still believes Milei will turn back around and endorse the token again, says he’s holding onto the extracted capital as leverage as investigations start to play out.
Perhaps stranger things have happened, but maintaining the illusion of an impending climactic third act goes one step further than Sam Bankman-Fried did in his now-historic interview with Money Stuff’s Matt Levine in April 2022 — about eight months before his arrest.
Bankman-Fried had described yield farming tokens in matter-of-fact terms — black boxes that do “literally nothing” but were dressed up to look like a “life-changing, world-altering protocol that’s gonna replace all the big banks in 38 days or whatever.”
The more money was piled into those completely useless boxes, the higher token valuations went, making headway for early participants to massively profit off of newer entrants. That left Levine to summarize Bankman-Fried’s position as: “I’m in the Ponzi business and it’s pretty good.”
For what it’s worth, The Prestige dramatically ends with gruesome details about the lengths to which two magicians went to maintain their “disappearing man” illusions: a mass grave of drowned clones in one instance, and a wife that chose suicide over living with the deceit of being duped by her husband and his secret twin brother.
If crypto can’t move on from these types of predatory token launches, then its future could end up even gorier — tight regulation of memecoin launchpads by way of a US government agency. Yeuch.
Fingers crossed that it’s possible for Davis’ interview with Coffeezilla to be the deathknell for these types of memecoins, in the same way that the Bankman-Fried chat largely put an end to high emission yield farming.
I’m not sure crypto wants to be fooled anymore.
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