$57.65M in USDC Frozen by US Court in Class Action Against Libra Memecoin Founders

A U.S. federal court in Manhattan has frozen approximately $57.65 million worth of USDC connected to a class-action lawsuit against the creators of the controversial Libra (LIBRA) memecoin, which suffered a meteoric rise and catastrophic collapse earlier this year.

According to on-chain data provided to Cointelegraph by class attorney Max Burwick, the funds were frozen on May 28 after the Southern District of New York (SDNY) issued a Temporary Restraining Order at the plaintiffs’ request. The court has scheduled a hearing for June 9 to decide whether the freeze will remain in place as the lawsuit proceeds.

Burwick, along with Tim Treanor, is representing lead plaintiff Omar Hurlock and others in a suit that accuses Kelsier Ventures and its co-founders, Gideon, Thomas, and Hayden Davis of orchestrating a fraudulent scheme through the Libra memecoin, allegedly siphoning over $100 million from manipulated liquidity pools.

The complaint also names KIP Protocol, its CEO Julian Peh, and Meteora co-founder Benjamin Chow as defendants. While multiple parties were contacted for comment, no public responses have been issued.

Memecoin Hype Turned Political Scandal

Libra (LIBRA) grabbed headlines on February 14 after a now-infamous X post by Argentine President Javier Milei appeared to endorse the coin, sending its market cap soaring to $4 billion before crashing 94% within hours. The incident fueled political outrage in Argentina, with opposition lawmakers demanding Milei’s impeachment—though the effort failed to gain momentum.

A March poll by Zuban Córdoba indicated the Libra debacle had significantly damaged Milei’s public approval.

Despite these political consequences, no formal actions were taken against Milei or Argentine officials. In fact, on May 19, Milei issued a decree to disband the task force investigating the scandal. Critics, including economist and Deputy Itai Hagman, blasted the decision, claiming,

“It was always a fake investigation… they’re covering each other up.”

On-Chain Freeze Confirmed on Solana

Blockchain data from Solscan confirms that two Solana wallets containing a combined $57.65 million in USDC were frozen on May 28 by the Multisig Freeze Authority.

• Wallet 3Fwr…ZQpK: $44.59 million frozen
• Wallet 3nHw…xNgH: $13 million frozen

These wallets are believed to be linked to individuals involved in the Libra project.

The class-action suit, filed on March 17, alleges that the defendants misrepresented the LIBRA token’s legitimacy and manipulated trading mechanisms to mislead retail investors. The plaintiffs now seek the return of funds lost in the pump-and-dump-style scandal.