The lawsuit seeks $258 billion from Elon Musk for his support of Dogecoin

An investor who lost money betting on Dogecoin, an originally parodic cryptocurrency that was particularly inflated by Elon Musk’s interest rates, filed a lawsuit on Thursday, demanding $258 billion from the multi-billionaire and his companies Tesla and SpaceX .

• Also read: Cryptocurrency crash: “The sector will not go away,” assures Binance boss

• Also read: Long-awaited meeting between Musk and Twitter employees

• Also read: Twitter is said to have provided fake account details to Elon Musk

Keith Johnson describes himself as “an American citizen who was defrauded by a dogecoin pyramid scheme set up by the defendants”. He is seeking that his lawsuit filed in a New York court be classified as a class action on behalf of investors who have suffered losses betting on Dogecoin since 2019.

Since Elon Musk started promoting the virtual currency this year, people who invested money in it have lost around $86 billion, he estimates. He demands reimbursement of this sum and double the damages, i.e. 172 billion.

Founded in 2013, Dogecoin was a tongue-in-cheek response to the two internet phenomena of the year: cryptocurrencies multiplying on the heels of bitcoin and montage of a photo of a Shiba Inu dog that was hugely popular on the internet.

Dogecoin’s price has hovered below one cent for most of its history.

But buoyed by some buying frenzy for improbable values ​​in early 2021, as well as Elon Musk’s multiple praises on Twitter, Dogecoin skyrocketed to over 70 cents in May 2021. Before he backed down shortly after a satirical show aired in which Elon Musk called virtual currencies a “scam” in a skit.

It developed Thursday at less than 6 cents.

Keith Johnson believes that Elon Musk “inflated the price, capitalization and trading volume” of the cryptocurrency through advertising. In his complaint, he transcribed the many tweets sent from the world’s richest man’s account, which has more than 98 million subscribers, including one promising to “literally take a Dogecoin to the moon.”

It also includes two entrepreneur-led companies: electric vehicle maker Tesla for accepting Dogecoin as payment for certain derivatives, and space company SpaceX for naming one of its satellites after Dogecoin.

Keith Johnson likens Dogecoin to a pyramid scheme because, according to the complaint, the virtual currency has no intrinsic value, produces nothing, is not backed by tangible assets, and is unlimited in the number of “coins” in circulation.

Complaints from investors who feel betrayed by the promises of virtual currencies are currently piling up in the United States with no guarantee of their outcome.

Leave a Comment