Elon Musk, SpaceX, Tesla Sued for $258 Billion Over Dogecoin

Elon Musk arrives for the 2022 Met Gala at the Metropolitan Museum of Art on May 2, 2022, in New York.

Elon Musk and his companies SpaceX and Tesla have been sued for $258 billion in a federal class action lawsuit accusing them of engaging in a “crypto pyramid scheme” by promoting Dogecoin.

The 26-page lawsuit begins with a lengthy dressing down of Dogecoin, stating that the cryptocurrency’s market cap plummeted from an all-time high of $93 billion after Musk appeared on Saturday Night Live to its value of $7 billion at the time of the complaint.

Keith Johnson, the investor suing Musk, noted that the billionaire, playing a fictional financial expert, called cryptocurrency a “hustle” on that appearance.

“Dogecoin is not a currency, stock, or security,” the complaint states. “It’s not backed by gold, other precious metal, or anything at all. You can’t eat it, grow it, or wear it. Dogecoin does not generate cash flow. It doesn’t pay interest or a dividend. It has no unique utility compared to other cryptocurrencies. It is not part of a new internet or the metaverse. It’s not based upon or tied to anything of value. It’s not secured by a government or private entity. The number of coins is unlimited. It’s simply a fraud whereby ‘greater fools’ are deceived into buying the coin at a higher price.”

Musk has called himself the “Dogefather” and frequently promoted it to his millions of followers on Twitter.

The lawsuit notes that is the platform where Musk has a history of getting in trouble with the federal regulators.

On Oct. 18, 2021, Musk entered into a consent decree with the Securities and Exchange Commission that required him to pay $20 million and agree to pre-clearance of his tweets to make sure they did not mislead investors. His argument that the agreement trampled his First Amendment rights recently failed in court.

The lawsuit traces Musk’s first tweet about Dogecoin to April 7, 2019, when he shared an article…

Read more at lawandcrime.com

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