U.S. Judge Unfreezes $57.6M in USDC Linked to LIBRA Token Amid Ongoing Lawsuit
Background: The LIBRA Token Controversy
The LIBRA token, launched in February 2025, drew massive attention when Argentine President Javier Milei promoted it on social media. Its market capitalization shot past $4 billion before collapsing by over 94% within hours, resulting in reported investor losses exceeding $250 million and allegations of a “rug pull” scam. These events prompted a class-action lawsuit and the freezing of project leaders Hayden Davis and Ben Chow’s assets.
The Court Ruling: Unfreezing the Funds
On August 21, 2025, U.S. District Judge Jennifer L. Rochon lifted the freeze on approximately $57.6 million in USDC stablecoins tied to the LIBRA token project. The ruling cited the defendants’ adherence to court orders and the lack of evidence that plaintiffs faced irreparable harm. Notably, the judge expressed doubts about the strength of the case against Davis and Chow, allowing them to regain access to funds stored in two wallets holding $13.06 million and $44.59 million, respectively.
Market Reaction: LIBRA Token Surges
The decision led to a dramatic 137% single-day surge in the LIBRA token’s value, highlighting how legal news can sharply influence cryptocurrency markets. The unfreezing of the assets was perceived positively by investors, signaling restored confidence—at least temporarily.
What’s Next: Legal and Regulatory Implications
Despite the recent court victory for Davis and Chow, the class-action lawsuit continues, and the path ahead for LIBRA remains murky. The outcome could set important precedents for cryptocurrency regulation and investor protection. Observers are urged to monitor further legal and regulatory updates that may impact the broader crypto industry.
Bottom Line
The unfreezing of $57.6 million in USDC marks a turning point in the LIBRA legal saga and delivers a short-term boost to the token’s market fortunes. However, the ultimate fate of LIBRA—and regulatory approaches to similar projects—will hinge on the ongoing court fight and evolving legal standards in the crypto sector.
