A group of crypto investors in Argentina sued a presidential candidate

What’s new? A group of investors sued Javier Milei, one of Argentina's presidential candidates, sued for promoting the cryptocurrency investment platform CoinX. The company promised investors large returns but stopped operating after Argentina's National Securities Commission (CNV) said it did not have a legal permit to operate in the country. The project shut down without returning investors' initial investment or the promised returns.

Information on Clarin's website

How did events develop? In December 2021, Milei visited the CoinX office, which he reported on his social media pages. According to the company's representatives, customers could earn up to 8% per month from investments in cryptocurrency. They also assured that they used artificial intelligence, autotrader (a bot for trading), and asset diversification to generate high returns, and brought in a team of experienced traders. At the time, Milei wrote that CoinX had “revolutionized investing” by helping Argentinians cope with inflation.

Milei's subscribers, who number more than 1 million, took his words as investment advice. After CNV's statement and the termination of the project, investors reported losses of 30 to 40 million pesos (~$220 000 to $290 000). They intend to seek damages in court.

In February Chainalysis analysts reported that in 2021 money transfers in cryptocurrencies increased worldwide, with several Latin American countries showing the highest growth. Venezuela, Argentina, Brazil, El Salvador, Honduras, Costa Rica, and Mexico saw 800-900% growth.

Argentina also created a center to support startups in financial technology and cryptocurrency. It will be supervised by CNV and aims to ensure that companies communicate with Argentine regulators at an early stage. However, in May, the Central Bank banned local financial institutions from offering transactions related to digital assets to customers.