Elon Musk sued for $258 billion for fraud: what is a pyramid scheme with Dogecoin

The person suing Elon Musk for an alleged pyramid scheme with Dogecoin claims to have lost $86 billion.

Photo: BRITTA PEDERSEN/Getty Images

An investor of the Dogecoin cryptocurrency filed a lawsuit against the founder of Tesla and SpaceX, Elon Musk, for an alleged pyramid scheme that would have left losses of $258,000 million dollars.

The plaintiff, identified as Keith Johnsonfiled the lawsuit against Musk, and against his two companies, in a New York court, saying he was “a defrauded US citizen.”

According to Johnson, Musk and his companies dedicated themselves to promoting the Dogecoin cryptocurrencywhen it did not have any type of value, which was established in the lawsuit as a “cryptocurrency pyramid scheme”.

The plaintiff explains that through his promotion on Twitter and with his companies, since Tesla accepts Dogecoin payments for certain products, the billionaire sought to increase “the price, market capitalization and trading volume”, of the cryptocurrency.

The plaintiff argued that what was done by Musk and his companies is comparable to a pyramid scheme, since Dogecoin did not have its own value nor was it a product.

He added that the cryptocurrency was not backed by a tangible assetas is the case with common course money, in addition to the fact that the number of Dogecoin is unlimited.

Dogecoin is a cryptocurrency that was created in 2013 as a game or criticism of crypto markets. Its founders used a popular internet meme of a Shiba Inu dog to characterize it.

The value of Dogecoin was tenths of a cent since its existence; nevertheless, in 2021, its price jumped to $0.73prompted by Musk’s comments on Twitter.

However, the value of this cryptocurrency plummeted this week to less than six cents on the dollar.

According to the plaintiff, the operation of Musk and his companies They made him lose $86 billion..

Johnson wants his lawsuit to be considered collective, since there are hundreds of other defrauded investors, and that is why adds another $172 billion of claims for a total of $258,000 million dollars.

“Defendants were aware as early as 2019 that Dogecoin was worthless and yet promoted Dogecoin to profit,” the lawsuit says.

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