Suggesting cryptocurrency for clients could get you sued, as poor-little-rich-boy Elon Musk has found out.
A Dogecoin investor is taking Elon Musk and his two companies Tesla and SpaceX to court, over claims of running a pyramid scheme with Dogecoin, which Musk once hailed as the “people’s crypto”.
Musk was so fond of Doge that he would tweet about it regularly. He also announced the sale of Tesla merch for Doge and asked customers whether they’d like the chance to pay for Tesla cars with the token. He would share memes and insights into Doge, and ended up branding himself the DogeFather.
In May 2021, Musk hosted Saturday Night Live and, during one skit that saw him playing a financial analyst, he branded Doge “a hustle”, which sent its value spiralling downwards in a matter of seconds. If anything, the joke confirmed Musk’s influence over the crypto market, which he was able to impact for better or worse with just a one-liner.
It is also proof that he ran a pyramid scheme, according to a new lawsuit filed in a federal court in Manhattan, obtained by Reuters. Dogecoin investor and plaintiff Keith Johnson alleges that Musk artificially boosted the value of the token, only to make it fall uncontrollably later on, which ended up costing him $86 billion in lost profits. He wants that amount set as damages – and tripled in the lawsuit.
“Defendants falsely and deceptively claim that Dogecoin is a legitimate investment when it has no value at all”, the lawsuit states. “Since Defendant Musk and his corporations SpaceX and Tesla, Inc began purchasing, developing, promoting, supporting and operating Dogecoin in 2019, Plaintiff and the class have lost approximately $86 billion in this Crypto Pyramid Scheme.”
The lawsuit also seeks to block Musk and the other two defendants from promoting Dogecoin, and for a judge to declare that trading in Doge is gambling.
