Dogecoin investor sues Elon Musk, Tesla, SpaceX for $258 billion
What's the story
Keith Johnson, a US citizen, has sued Elon Musk, Tesla, and SpaceX for defrauding him with the "Dogecoin Crypto Pyramid Scheme." The world's richest man and his firms have been sued for a staggering $258 billion for their involvement in the alleged pyramid scheme. They are being accused of driving up the price of the Dogecoin cryptocurrency, only to let it fall later.
Context
Why does this story matter?
As cryptocurrencies continue their downhill trajectory, suits by investors who feel cheated by the promises of virtual currencies are on the rise. A few days ago, Binance and its CEO were sued by an investor for the collapse of Stablecoin. And now, we have the Musk case. Dogecoin is down about 67% this year, giving up phenomenal gains of 2021.
Reason
What is Musk being accused of?
Dogecoin, founded in 2013, traded for a fraction of a cent for most of its existence. However, 2021 saw the price of the cryptocurrency increase. According to Johnson, "the price, market cap, and trading volume of Dogecoin" rose due to the billionaire's promotion. He says that the defendants were aware of Dogecoin's lack of value since 2019 but still promoted it.
The case
Plaintiff wants a class action suit against Musk
The case has been filed at the US District Court, Southern District of New York, and is titled Johnson vs Musk et al. Johnson wants the court to consider it as a class action suit on behalf of every investor who has lost money on Dogecoin since 2019. He has likened the crypto to a pyramid scheme because of its lack of intrinsic value.
Information
Johnson seeks $172 billion in damages
The plaintiff is seeking $86 billion from the defendants to cover the losses suffered by investors since May 2021. He wants an additional $172 billion in damages. Johnson has also requested the court to block the defendants from promoting Dogecoin.
Accomplices
Why are Tesla and SpaceX being sued?
Johnson has named Tesla in the suit because the automaker accepts Dogecoin as payment for certain derivatives. SpaceX has an even stronger connection with Dogecoin. The space tourism company had named one of its satellites after the controversial crypto. Musk had once even promised via Twitter that SpaceX would "put a literal Dogecoin on the literal moon."