Elon Musk Cryptocurrency Dogecoin

Elon Musk Cryptocurrency Dogecoin sued for $258 billion over the alleged Dogecoin pyramid scheme. Dogecoin spikes after Elon Musk said he’ll keep buying the cryptocurrency.

  • Elon Musk said he would keep supporting Dogecoin, sending its price up by nearly 10%.
  • Like many cryptocurrencies, the coin has lost most of its value this year following a huge selloff.
  • Bitcoin and Ethereum remained volatile after big losses on Saturday. 

NEW YORK, June 16 (Reuters) – Elon Musk was sued for $258 billion on Thursday by a Dogecoin investor who accused him of running a pyramid scheme to support the cryptocurrency.

In a complaint filed in federal court in Manhattan, plaintiff Keith Johnson accused Musk, electric car company Tesla Inc (TSLA.O), and space tourism company SpaceX of racketeering for touting Dogecoin and driving up its price, only to then let the price tumble.

Elon Musk Cryptocurrency Dogecoin

NEW YORK, June 16 (Reuters) – Elon Musk was sued for $258 billion on Thursday by a Dogecoin investor who accused him of running a pyramid scheme to support the cryptocurrency.

In a complaint filed in federal court in Manhattan, plaintiff Keith Johnson accused Musk, electric car company Tesla Inc (TSLA.O) and space tourism company SpaceX of racketeering for touting Dogecoin and driving up its price, only to then let the price tumble.

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Musk is CEO of both Tesla and SpaceX.

“Defendants were aware since 2019 that Dogecoin had no value yet promoted Dogecoin to profit from its trading,” the complaint said. “Musk used his pedestal as World’s Richest man to operate and manipulate the Dogecoin Pyramid Scheme for profit, exposure and amusement.”

The complaint also aggregates comments from Warren Buffett, Bill Gates and others questioning the value of cryptocurrency.

He also wants to block Musk and his companies from promoting Dogecoin and a judge to declare that trading Dogecoin is gambling under federal and New York law.

The complaint said Dogecoin’s selloff began around the time Musk hosted the NBC show “Saturday Night Live and, playing a fictitious financial expert on a “Weekend Update” segment, called Dogecoin “a hustle.”

Elon Musk Cryptocurrency Dogecoin

Tesla in February 2021 said it had bought $1.5 billion of bitcoin and for a short time accepted it as payment for vehicles.

Dogecoin traded at about 5.8 cents on Thursday, down from its May 2021 peak of about 74 cents.

The case is Johnson v. Musk et al, U.S. District Court, Southern District of New York, No. 22-05037.

Dogecoin jumped nearly 10% off near-record lows on Sunday after Elon Musk said he would continue to buy the cryptocurrency.

The coin rose about 8.5% in the space of 24 hours after Musk tweeted: “I will keep supporting Dogecoin.”

In response to another user telling Musk to “keep buying it then,” he replied: “I am.”

Musk’s tweets caused the cryptocurrency to spike nearly 10% in the space of an hour to $0.056, helping to compensate for heavy declines over the past month.

It has aligned with a rebound in other cryptocurrencies as they struggle following significant losses.

After a record 12-day losing streak, Bitcoin was trading at about $18,300 on Sunday after sliding under $20,000 on Saturday, according to CoinDesk. It had been as low as $17,600.

Ethereum fell as low as $880 before rising to trade at about $965, according to CoinDesk.

The rises represent a fraction of the losses given up by cryptos this year, with Bitcoin down 70% and Ethereum down about three quarters this year. Dogecoin is down by two thirds.

Dogecoin was started by its creators as a joke, but has gained fans since Musk began to champion the coin in 2019.

The makers of Dogecoin told Decrypt last year they were working with Musk to make the coin a cheaper, greener alternative to bitcoin.

Its price has never recovered from a Saturday Night Live appearance in May 2021 where Musk jokingly labelled the coin a “hustle,” sending it from record highs of $0.72 to $0.33 in a week. The currency also rallied after news first broke of Musk’s plan to buy Twitter in a $44 billion deal.

Elon Musk Cryptocurrency Dogecoin was this week sued for nearly $260 billion by a Dogecoin investor for allegedly running a “pyramid scheme“, by pretending the coin has any sort of value to drive up its price.

References

  1. Business Insider
  2. Reutures
  3. Tecktune

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