Elon Musk, Tesla Accused of Dogecoin Pyramid Scheme in $258B Suit -Breaking
- An investor is suing Tesla CEO Elon Musk for $258 Billion over a pyramid scheme that he allegedly used to help the cryptocurrency.
- A lawsuit was filed Thursday in Lower Manhattan federal court by Keith Johnson, accusing Elon Musk of stealing his companies SpaceX and Tesla.
- According to Johnson’s estimate, investors have lost a total of around $86 billion dollars.
A class-action lawsuit worth $258 billion has been filed against Tesla and SpaceX CEO and Founder Elon Musk, his aforementioned companies over alleged “engag[ing] in a crypto pyramid scheme.” The plaintiff, Keith Johnson, who invested early and promoted Dogecoin, filed the complaint in a federal court in Manhattan on Thursday.
Johnson is accusing Musk, Tesla, SpaceX, and DOGE of “a fraudulent scheme to artificially inflate the price” of Dogecoin (DOGE) through “false and misleading” tweets, according to the court filing. Johnson is now suing Musk to recover up to $86 million in damages.
Johnson also claims that Johnson represents a group of DOGE investors who are seeking $172 billion damages. As per the suit, this is a “reasonable estimate of investors’ losses” from trading DOGE since 2019.
The suit also claims that Musk’s tweets about Dogecoin were part of a “pump-and-dump scheme” to get rid of his DOGE holdings. Musk is a long-standing supporter and advocate of Dogecoin. He often tweeted about it even before the 2020 bull run.
Elon Musk announced via Twitter in March 2022 that SpaceX will begin accepting Dogecoin, (DOGE), as payment for goods. Musk disclosed also that Tesla Motors (NASDAQ: ) will accept DOGE payments for merchandise.
In addition to the comments of Bill Gates and Warren Buffett regarding cryptocurrency validity, this complaint included statements from Bill Gates. Johnson claims that the currency does not have an inherent value and it can be compared to a pyramid scheme.
The lawsuit was mocked by the crypto community. Dogecoin creator Shibetoshi Nakamoto, a Tweet of whose was cited in the lawsuit as supporting evidence, called the lawsuit “stupid as f*ck” on Twitter on Thursday, but admitted that crypto trading isn’t much different from gambling.
Dogecoin’s value has been on the decline over the past year, dropping to $.057 per coin Thursday, from a peak of $.64 last May. Musk, among others have taken to heart the cryptocurrency which was originally created as a joke in 2013. At the time of writing, Dogecoin’s price is $0.057743 USD with a 24-hour trading volume of $672,859,771. CoinMarketCap currently ranks at #10 with a current market cap of $766,870,000.