The Daily: Javier Milei faces charges over memecoin scandal, Ethereum user spreads 'brain control' messages and more

The following article is adapted from The Block’s newsletter,  The Daily , which comes out on weekday afternoons.

I hope you had a good weekend, folks. Just when it seemed like the latest memecoin hype was fading, another world leader is in hot water over promoting a token this Presidents' Day.

In today's newsletter, Javier Milei faces fraud charges over the LIBRA memecoin scandal, someone burns and donates millions of dollars worth of ether to spread "brain control" warning messages onchain, analysts outline the key catalysts for a continued bitcoin bull run and more.

Let's get started.

Javier Milei charged with fraud over LIBRA memecoin

Argentinian President Javier Milei faces fraud charges over his involvement in the Solana-based LIBRA memecoin, which collapsed 95% from its peak.

• LIBRA emerged last Friday after Milei promoted the token on X before later deleting the post. The memecoin's price briefly surged to a market cap of nearly $5 billion before crashing.
• "Within this illicit association, the crime of fraud was committed, in which the president's actions were essential," plaintiff Jonatan Baldiviezo told the Associated Press, while some members of his political opposition called for an impeachment trial.
• Milei maintained his innocence, denying prior knowledge of the token, and has called for an anti-corruption investigation.
• Blockchain analysts at Bubblemaps linked LIBRA and First Lady Melania Trump's official memecoin to the same entity, alleging insider trading and coordinated sniping on both tokens.
• Hayden Davis, an advisor and self-proclaimed "facilitator" of the Libra project, accused Milei of sparking the crash by withdrawing his support, though the token had already lost significant value by that time.
• In a later interview with YouTuber and crypto sleuth Coffeezilla, Davis admitted the LIBRA team sniped tokens at launch, claiming it was done to deter others from doing so, but acknowledged profiting from the tactic.
• He also admitted that he was involved in Melania Trump's memecoin launch, where the team also sniped its token.
• Davis claimed Tech Forum Argentina's Mauricio Novelli, Manuel Godoy and Kip Protocol are central members of the Libra memecoin project.
• Onchain data suggests insiders extracted millions of dollars from LIBRA, while Davis claims to control but not own $100 million of the project's sniped funds as the scandal unfolds.

User burns and donates ether to spread 'brain control' warnings onchain

An Ethereum user burned 603.38 ETH ($1.67 million) over the past seven days to spread bizarre warnings about alleged "brain control" technology via onchain messages.

• The same user has also donated 711.52 ETH ($1.97 million) to WikiLeaks, according to Etherscan labeling, adding messages claiming they have been monitored and manipulated since birth by a "brain-control organization."
• The user, identifying as Lezhi Hu, described intense personal distress and alleged brain-control tactics are widespread among global military powers.
• "With the continuous development of brain-machine interfaces and mind-reading technology, a new type of crime has emerged: wild animals have become puppets or complete slaves of digital machines," Hu wrote in one of the onchain messages.

Key catalysts for bitcoin bull market next leg

Analysts at Bernstein said the " next leg of the bitcoin bull market is loading ," driven by policy shifts and increasing institutional adoption.

• Key catalysts include the new U.S. Crypto Task Force's focus on delivering a National Bitcoin Reserve and potential investments in crypto companies as part of a Sovereign Wealth Fund, they said.
• A bitcoin reserve could be funded by the Federal Reserve or Treasury but would likely require legislative approval, possibly financed through debt or gold sales, according to the analysts.
• Bitcoin seized by the U.S. government, valued at around $20 billion, could also be added to the reserve, potentially sparking a global adoption race among sovereigns, they added.
• "The confluence of adoption by banks, institutional investors, corporates and eventually sovereigns is positioning bitcoin as the clear challenger to gold,” the analysts wrote in a note to clients. "With bitcoin at $2 trillion market value vs. $18 trillion market value of proven gold reserves, we see asymmetric upside for bitcoin.”

CalSTRS pension fund reports $83 million MSTR holdings

The California State Teachers Retirement System (CalSTRS), the second-largest public pension fund in the U.S., nearly doubled the value of its Strategy shareholdings to $82.7 million in Q4, adding 5,191 shares as prices surged.

• Strategy (formerly MicroStrategy) remains the largest corporate bitcoin holder, boosting its reserves to 478,740 BTC, worth over $46 billion, last week.
• MSTR shares jumped over 70% in Q4, and bitcoin hit new all-time highs amid pro-crypto Donald Trump's presidential election victory.
• Meanwhile, CalSTRS reduced its Coinbase holdings slightly as the value of its COIN stock rose from $54.6 million to $76 million during the quarter.

Bitcoin dominance nears multi-year high

Bitcoin dominance has surged past 60% as institutional investors favor the foremost cryptocurrency over volatile altcoins like Solana amid the LIBRA memecoin collapse.

• "The downturn in alts is a reflection of institutional capital flowing into bitcoin, which is now seen as a stable investment relative to other digital assets," TP ICAP Digital Assets Director Hina Sattar Joshi told The Block.
• However, a fresh catalyst, such as strong ETF inflows or macroeconomic shifts, may be needed to lift bitcoin out of its current range, QCP Capital analysts said.

In the next 24 hours

• Bank of England Governor Andrew Bailey will speak at 4:30 a.m. ET on Tuesday. U.S. FOMC member Mary Daly and Fed Vice Chair Michael Barr follow at 10:20 a.m. and 1 p.m., respectively.
• Oasis is set to unlock 56 million ROSE tokens worth $2.5 million, representing 0.83% of the circulating supply. EigenLayer will release 1.29 million EIGEN tokens worth $2.4 million, 0.53% of its circulating supply.
• Consensus kicks off in Hong Kong.

Never miss a beat with The Block's  daily digest  of the most influential events happening across the digital asset ecosystem.