A New York court recently made a striking decision in a high-profile cryptocurrency case. Millions of dollars in digital tokens, once frozen, are now accessible again. This move comes after a judge reversed an earlier order targeting wallets linked to Hayden Davis, an advisor involved in the controversial LIBRA token project.
The LIBRA token scandal, which even pulled in Argentine President Javier Milei earlier this year, just saw another surprising turn. A U.S. judge has now ordered a substantial sum of related cryptocurrency to be unfrozen. U.S. District Judge Jennifer L. Rochon in Manhattan made this decision on Tuesday. She lifted a temporary restraining order first put in place back in June. That order had frozen assets belonging to several people facing a class-action lawsuit tied to the LIBRA token. This news was first reported by Law360.
Cointelegraph later picked up the story. The judge actually denied a preliminary injunction request from the plaintiffs. These investors were seeking over $100 million in damages. They claim they lost money when the LIBRA project failed.
Back in May, two specific crypto wallets linked to this scandal held about $57 million in USDC. Circle, the company that issues the USDC stablecoin, froze these funds. This happened after a New York federal court judge issued an order. The decision to block access to these funds came from a hearing for a class-action lawsuit. This lawsuit names several key figures. They include Hayden Davis, who promoted and advised on LIBRA. Also named is Ben Chow, former CEO of the decentralized exchange Meteora. The blockchain infrastructure company KIP Protocol is a defendant. Its co-founder, Julian Peh, is also part of the suit.
Judge Rochon explained her reasoning this week. She found no immediate risk that the defendants would hide or spend the assets. So, keeping the freeze in place was not needed. She also sounded doubtful about the class-action lawsuit’s chances of winning. Still, she noted that the case is quite new. Now, with the freeze lifted, Davis and Chow can access the $57.6 million in USDC. These funds were sitting in those two wallets.
The LIBRA Scandal’s Argentine Connection
Let’s rewind to the LIBRA token itself. It launched in February 2025. Argentine President Javier Milei heavily promoted it. He claimed it would help small businesses in Argentina. But then, disaster struck. The token collapsed in mere hours. It lost over 90% of its value almost instantly. Its market value plunged from $1.17 billion down to $33 million. DEX Screener provided these stark figures.
This dramatic fall quickly brought accusations of a "rug pull." That’s when insiders allegedly sell off their holdings. Many claimed $107 million was pulled from the project. It seemed some people with special knowledge sold their tokens right after the price peaked.
President Milei initially touted the token on X (formerly Twitter). However, he quickly deleted his posts. He later said he had no direct link to the project. He claimed he merely "spread the word" about a private venture. This explanation didn’t stop an investigation by the Argentine Congress. They looked into possible ethics violations. Yet, Milei’s government closed that probe without filing any charges. This led to accusations of a cover-up.
In June, Argentina’s Anti-Corruption Office (OA) stated its view. They said President Milei acted on his own when promoting the LIBRA cryptocurrency. This statement came just weeks after his government shut down a state unit. That unit had been investigating the LIBRA case. This move effectively ended the government’s official inquiry.
Just last month, Hayden Davis tried to get the lawsuit against him thrown out. But his motion was rejected. The class-action lawsuit is still active. Law firms Burwick Law and Treanor Law filed it. They are still fighting to get money back for investors who lost funds. Beyond this civil case, a separate criminal court investigation is also ongoing in Argentina.