US Court docket Blocks $57M in USDC Amid LIBRA Token Controversy

A US federal courtroom has frozen roughly $57.65 million price of USDC stablecoins in reference to a category motion lawsuit linked to the LIBRA token rip-off that happened a few months in the past.

On 28 Could 2025, the US District Court docket for the Southern District of New York issued a Momentary Restraining Order that froze the property. The quantity will stay frozen until June ninth, when a listening to is scheduled to find out if the freeze will stay in impact whereas the lawsuit proceeds.

Circle’s multi-sig freeze authority froze two Solana wallets in reference to the LIBRA deployer and mission staff as a part of the continuing lawsuit filed by the New York-based legislation agency Burwick.

As part of the lawsuit, quite a few LIBRA buyers are suing Kelsier Ventures, a crypto agency, together with its co-founders, Gideon, Thomas, and Hayden Davis.

ALERT: $57M OF USDC ASSOCIATED WITH LIBRA FROZEN BY CIRCLE

Two Libra accounts have simply been frozen by Circle, together with the Libra deployer pockets.

These accounts contained a mixed $57M in USDC which is now motionless. pic.twitter.com/HpmaM5HwVJ

— Arkham (@arkham) Could 28, 2025

Different defendants on this case embrace Benjamin Chow, the co-founder of Meteora, a Solana-based DeFi platform; Julian Peh of KIP Protocol, a decentralised AI framework centered on digital property rights; and different organisations concerned within the advertising and marketing of the LIBRA token.

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Background on the Lawsuit

The LIBRA memecoin attracted consideration after a publish on X by Argentinian President Javier Milei on 14 February 2025. The token was marketed as a method to fund small companies in Argentina.

Inside an hour of Milei’s commercial on X, the LIBRA token’s worth surged from just a few cents to $5, and its market cap surged to $4 billion, solely to crash by 94% inside hours.

Reportedly, insiders controlling greater than 70% of the availability dumped massive quantities, sending the LIBRA token’s worth spiralling downwards.

This sparked a political outrage in Argentina, with members of the opposition calling for Milei’s impeachment. Though the motion failed to collect momentum, a ballot carried out in March 2025 by Zuban Córdoba advised that the scandal harmed Milei’s approval score and public picture.

Burwick filed the lawsuit on 17 March 2025, alleging that the defendants launched the LIBRA cryptocurrency and deceived buyers, finally misappropriating over $150 million whereas buyers misplaced over $250 million.

Solscan, a blockchain explorer for Solana, disclosed information showcasing that the authorities froze roughly $44.59 million in stablecoins on the deal with 3Fwr…ZQpK, whereas somebody locked greater than $13 million from the pockets 3nHw…xNgH.

The asset freeze signifies that the US courts are able to intervene to mitigate additional losses and to make sure potential compensation for the victims. If profitable, this case might set a brand new precedent and maintain crypto founders and promoters accountable for deceptive buyers and fueling speculative hype cycles.

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Milei Shuts Down LIBRA Token Investigation

On 19 Could 2025, Milei signed a decree to disband the investigative activity power probing the LIBRA scandal. Notably, authorities haven’t introduced any costs in opposition to Milei or every other Argentinian officers linked to the controversy.

Itai Hagman, a member of the Chamber of Deputies of Argentina, stated, “It was at all times a faux, they by no means dared to analyze something in any respect, and so they’re masking one another up as a result of they’re utterly as much as their necks in it.”

Up to now, the one rationalization offered by the authorities for disbanding the duty power is that it had fulfilled its assigned operate.

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