US court freezes $57M USDC allegedly linked to LIBRA scandal

Published on Thursday, May 29, 2025 by Cointelegraph | Found on Glideslope.ai

A US federal court has frozen around $57.65 million worth of the stablecoin USDC in a class action case over the controversial Libra memecoin.Onchain data shared with Cointelegraph by the class group’s lawyer, Max Burwick, shows nearly $57 million worth of USDC (USDC) was frozen on May 28 after a Manhattan court agreed to a temporary freeze.“Yesterday, a federal court in SDNY [Southern District of New York] entered a Temporary Restraining Order at our request, Burwick Law, supported by Tim Treanor, freezing approximately 57.65 million USDC held at Circle,“ Burwick told Cointelegraph.He added that the court is scheduled to hold a hearing on June 9 to determine whether the assets will remain frozen as the class-action lawsuit progresses.Burwick is representing Omar Hurlock and other plaintiffs in a class-action suit against crypto venture firm Kelsier Ventures and its three sibling co-founders, Gideon, Thomas and Hayden Davis, on March 17, alleging they created the Libra (LIBRA) cryptocurrency and misled investors to siphon over $100 million from one-sided liquidity pools.The suit also named blockchain infrastructure companies, KIP Protocol and its CEO, Julian Peh, along with Meteora and its co-founder, Benjamin Chow, as defendants.Chow’s lawyer, Kelsier Ventures and KIP Protocol were contacted for comment. LIBRA reached a $4 billion market cap following an X post from Argentine President Javier Milei on Feb. 14 before crashing 94% hours later.The saga caused a political scandal for Milei, prompting members of Argentina’s opposition party to call for his impeachment, though little traction was gained beyond those statements.Data from polling platform Zuban Córdoba in March suggested that the Libra scandal negatively impacted Milei’s image and the national management approval rating.Two Solana wallets with total USDC balances worth $57.65 million were frozen on May 28 at 3:15 am and 3:18 am UTC.Data from Solana’s blockchain explorer, Solscan, shows that the address “3Fwr…ZQpK” had $44.59 million worth of the stablecoin frozen, while a little over $13 million was frozen from the wallet address “3nHw…xNgH.”Both wallets were frozen by the Multisig Freeze Authority, Solscan data shows.Milei closes Libra investigation in ArgentinaOn May 19, Milei signed a decree to shut down a task force established to investigate the Libra scandal.Related: Solana may be a memecoin ‘one-trick pony’ — Standard CharteredNo action was taken against Milei or any other Argentine official allegedly tied to the scandal.However, some critics say a legitimate investigation wasn’t properly conducted in the first place.“It was always a fake, they never dared to investigate anything at all, and they’re covering each other up because they’re completely up to their necks in it,” Itai Hagman, an economist and member of the Chamber of Deputies of Argentina, said in a May 20 X post.Magazine: Memecoins are ded — But Solana ‘100x better’ despite revenue plunge