Tesla CEO, Elon Musk and companies sued for $258bn over alleged Dogecoin ‘pyramid scheme’

Elon Musk and two of his firms, Tesla and SpaceX, are going through a $258 billion lawsuit after an investor claimed he was “defrauded” by a Dogecoin “pyramid scheme.”

The investor, Keith Johnson, has named the entrepreneur, in addition to his firms Tesla and SpaceX, within the lawsuit filed in federal court docket in Decrease Manhattan on Thursday, June 16. 

Mr Johnson is demanding $86bn in damages along with tripled damages of $172bn for losses incurred from buying and selling the cryptocurrency since 2019, in addition to an order blocking Musk and the businesses from selling Dogecoin, and declaring that Dogecoin buying and selling constitutes playing underneath US and New York legislation.

The value of 1 dogecoin on Thursday was slightly below six cents, a great distance off from its Could 2021 excessive of 74 cents.

“Dogecoin will not be a forex, inventory, or safety. It’s not backed by gold, different valuable metallic, or something in any respect. You’ll be able to’t eat it, develop it, or put on it,” the lawsuit states.

“It doesn’t pay curiosity or dividend. It has no distinctive utility in comparison with different cryptocurrencies…It’s not secured by a authorities or non-public entity.

“It’s merely a fraud whereby ‘larger fools’ are deceived into shopping for the coin at the next value.”

“Since defendant Musk and his firms Spacex and Tesla Inc. started buying, growing, selling, supporting, and working dogecoin in 2019, [the] plaintiff and the category have misplaced roughly $86 billion on this crypto pyramid scheme,” the court docket doc particulars.

Mr. Johnson needs to signify different buyers who’ve misplaced cash in Dogecoin since April 2019.

Mr. Musk, who has a private fortune of $217bn, stated in March that he wouldn’t promote bitcoin, Ethereum, or Dogecoin, regardless of billions being wiped off their values in current months.