Milei's Crypto Defense Backfires After Aide Interrupts Interview

Yahoo

18-02-2025

(Bloomberg) -- President Javier Milei stumbled in his bid to downplay his role in a crypto scandal in which he touted a memecoin that later crashed, with fallout spreading to Argentine assets after investors returned from a US holiday.
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The libertarian leader tried to contain the effects of the weekend's debacle in a Monday night television interview. But that effort backfired when parts that weren't broadcast were accidentally uploaded to YouTube and subsequently deleted.
Milei spoke for over an hour in his first public appearance since the incident, explaining that he acted in good faith in his role as a private citizen, not president. He said he simply wanted to spread the word about — but not promote — a venture that purported to support Argentine businesses. The episode, however, resulted in a 'slap in the face.'
But a two-minute excerpt that wasn't broadcast made its way online and spread quickly on social media. In the clip, Milei seemed to suggest he would put state machinery to work on his behalf, saying he would summon the justice minister for legal advice. At that point, Milei's most trusted adviser, Santiago Caputo, walked onscreen and whispered in the president's ear.
The interviewer, Jonatan Viale of Todo Noticias, stood by. 'Yes, I understand, I realize this could bring you a judicial mess,' Viale said, nodding after the intervention as the camera continued to roll. 'Where were we?'
In an earlier part of the clip, a laughing Viale tells Milei that the interview questions had been agreed upon with Milei's sister, Karina, presidential spokesman Manuel Adorni and Caputo, whose uncle is Argentina's economy minister. The Milei siblings and Caputo together make up the administration's 'iron triangle,' the president has said in previous interviews.
Viale didn't immediately respond to a request for comment.
Investors, many of whom were taking stock of the situation for the first time since US markets were closed Monday, sold off Argentina's sovereign bonds, which were among the worst performers in emerging markets Tuesday morning. Some of the notes, however, trimmed their decline later in the session.
In New York, American depositary receipts of some of the country's largest companies, including state oil giant YPF SA and lender Grupo Supervielle SA, fell at market open before paring losses, too.
'It is logical to see some de-risking, but it does not mean that the lower prices will stay there if Milei can spin this into a one-off misstep,' Walter Stoeppelwerth, chief investment officer of Buenos Aires-based brokerage Grit Capital, said by text message. 'His popularity rides on inflation and growth and losses for Bitcoin punters do not resonate with the man and woman on the street.'
The government referred questions about the president's remarks to Adorni's own interview Tuesday morning, in which he explained the interruption had been an honest mistake made by Caputo. Milei's adviser doesn't normally participate in TV broadcasts, Adorni said, insisting the administration doesn't set questions or set out boundaries for the president's interviews.
'Santiago Caputo has the defect, to put it that way, of excellence,' Adorni told news channel A24. 'He noticed this could lend itself to confusion among part of the audience and decided to cut the interview. In fact, when the interview was over, the president told Santiago it had been unnecessary.'
Viale is one of a small group of local journalists that regularly interviews Milei and his cabinet members. Economy Minister Luis Caputo also spoke Monday, on A24, where he tried to reassure the public that the incident would have no fallout for markets and said that no overseas investors had texted him to inquire about the matter.
It remains unclear who was responsible for the scam and who profited. The opposition pounced on the scandal, calling for an impeachment trial and filling over 100 lawsuits. Milei, meanwhile, still plans to fly to Washington on Wednesday to attend the Conservative Political Action Conference, where he hopes to meet US President Donald Trump.
(Updates market move in 8th paragraph. An earlier version corrected the spelling of Viale's first name in the 5th.)
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