Elon Musk Sued $258 Billion Over Alleged Dogecoin 'Pyramid Scheme'
By Kristin Myers on June 17, 2022 at 10:15 AM EDT
Billionaire Elon Musk has found himself on the receiving end of yet another lawsuit.
This time, he’s being sued for $258 billion dollars by a cryptocurrency investor who’s accused him of running a Dogecoin pyramid scheme.
Elon Musk Sued $258 Billion Dollars By Cryptocurrency Investor
According to Reuters, the lawsuit was filed in federal court in Manhattan on Thursday, June 16. The plaintiff, Keith Johnson, is accusing Forbes’ richest man, the electric car company Tesla, and Musk’s space tourism company SpaceX of driving up the price of Dogecoin and then letting it drop. Musk is the CEO of Tesla and the founder and CEO of SpaceX.
The complaint reads: “Defendants were aware since 2019 that Dogecoin had no value yet promoted Dogecoin to profit from its trading.” It goes on to say that “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 lists comments from Bill Gates, Warren Buffett, and other industry analysts questioning the value of cryptocurrency.
Johnson is seeking $86 billion dollars in damages. He says that this figure represents the loss of Dogecoin’s market value since May 2021 and wants to see the figure triple.
Johnson also wants to block Musk and his companies – mainly Tesla and SpaceX – from promoting Dogecoin. He would also like a judge to declare that trading Dogecoin is akin to gambling under federal and New York law and should be regulated as such.
Complaint Names Elon Musk ‘Saturday Night Live’ Sketch As Reason For Dogecoin Fall
The complaint said that Dogecoin’s tumble began around the time Musk hosted an episode of “Saturday Night Live.” While appearing on the “Weekend Update” segment of the show, Musk played the character of a fictional financial expert when he jokingly called Dogecoin “a hustle.”
However, Johnson is using this as evidence in his complaint as one of the reasons for Dogecoin’s fall. The “Weekend Update” sketch named in the complaint can be seen in the video below. His five-minute monologue from the episode can be seen in the video above for those interested.
As Reuters noted, in February 2021, Tesla said that it bought $1.5 billion dollars worth of bitcoin. For a short time, it also accepted bitcoin as payment for its electric vehicles.
On Thursday, June 16, Dogecoin was trading for around 5.8 cents, which was down from its peak in May 2021 at around 74 cents.
In court, Johnson will need to prove just how Musk was able to turn Dogecoin into an alleged pyramid scheme.
In other news, Musk is still planning on buying Twitter for $44 billion dollars. An agreement was reached earlier this year after Musk texted Twitter board chair, Bret Taylor, with an offer of $54.20 per share, according to text messages published in an SEC filing at the time.
During his first meeting with Twitter employees, Musk pointed out the benefits of having a diverse content stream and compared the social media company to other apps, such as YouTube and TikTok. The comments from his private meeting with Twitter employees can be read here.
