New York (The Times Groupe)- The business magnate and investor Elon Musk, his electric car company Tesla, and space company SpaceX are being sued for $258 billion by a cryptocurrency investor who says Musk ran a Ponzi scheme to boost Dogecoin’s price.
Plaintiff Keith Johnson accuses Musk of “racketeering” for promoting Dogecoin, once an unknown cryptocurrency, and accuses him of causing its price to swell exponentially before allowing it to plummet, causing investors billions of dollars in losses.
Using his position as World’s Richest Man, Musk operated and manipulated the Dogecoin Pyramid Scheme for profit, exposure, and amusement, according to a lawsuit filed on Thursday in federal court in Manhattan. “Defendants knew since 2019 that Dogecoin had no value, yet promoted Dogecoin to profit from its trading.
“Defendants claim Dogecoin is a legitimate investment when it has no value at all. Since Defendant Musk and his corporations SpaceX and Tesla, Inc began purchasing, developing, promoting, supporting, and operating Dogecoin in 2019, Plaintiff and the class have lost approximately $86 billion,” the suit stated.
On May 8, 2021, around the time Musk hosted the popular NBC show Saturday Night Live, Dogecoin’s price plummeted.
He claims Dogecoin investors have lost $86 billion as a result of Dogecoin’s price decline since that day – an amount he believes has been lost since Musk first began promoting it.
He also asks the court to stop Musk and his firms from promoting Dogecoin, and to declare Dogecoin trading as gambling under federal and New York state laws.
By promoting Dogecoin on his personal Twitter account in December 2020 using many “dog-themed memes,” Musk paved the way for its price to skyrocket by 4,000% to $0.74 in May that year, making it a top-10 cryptocurrency.
In the lawsuit, Musk’s memes and tweets, in which he refers to himself as the “Dogfather”, are used to prove that he controls the cryptocurrency price.
Due to the recent price collapse for Bitcoin and other cryptos, Dogecoin’s price plummeted to $0.05 this week – a 93% decline from its record high price.
Musk also announced earlier this year that Tesla would accept Dogecoin as a form of payment when purchasing the company’s products.
Many consider Dogecoin to be the first “meme coin” since it features a Shiba Inu dog as its logo.
In 2013 two software engineers created it as a joke to make fun of Bitcoin and the widespread speculation surrounding cryptocurrencies at the time.