Dogecoin 'pyramid scheme' lawsuit: Why Elon Musk is being sued?

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 Dogecoin 'pyramid scheme' lawsuit: Why Elon Musk is being sued?
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Highlights

  • Elon Musk is the founder and CEO of Tesla and SpaceX.
  • Keith Johnson reportedly calls the crypto project a "Dogecoin Crypto Pyramid Scheme."
  • Dogecoin had clocked an all-time high of US$ 0.7376 apiece on May 8, 2021.

Elon Musk, the chief executive officer (CEO) of Tesla, has reportedly been sued for US$ 258 billion by a man who has alleged that he runs a pyramid scheme to promote Dogecoin. The meme-based cryptocurrency garnered traction among investors over the last year.

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In the same case, the plaintiff sued Musk's firms Tesla and SpaceX. Musk is the founder and CEO of SpaceX. This comes after Elon Musk announced last year that Tesla would accept Dogecoin for merchandise, causing the cryptocurrency to soar.

Some reports suggest that Mr Johnson has accused Mr Musk and his companies of promoting Dogecoin and driving its price, only to see it plummet.

Dogecoin pyramid scheme©2022 Kalkine Media® 

What are the allegations against Elon Musk?

Keith Johnson could have lost money after he bought Dogecoin and reportedly calls it a "Dogecoin Crypto Pyramid Scheme."

According to reports, Mr Johnson claims that investors have lost about US$ 86 billion since 2019. The plaintiff has filed the lawsuit as he wants Mr Musk to pay back the money to investors and an additional $172 billion in damages.

As per the lawsuit, the plaintiff claimed that the defendants were aware since 2019 that Dogecoin had no value but promoted it to earn profit from its trade. Mr Jonathan has reportedly alleged that Mr Musk used his position to profit and entertain himself by promoting the virtual currency.

Bottom line

At the time of writing, the price of Dogecoin was down by 0.7 per cent in the last 24 hours and was trading at US$ 0.05643 per token, as per CoinMarketCap data.

The crypto market continues to crash and has dipped massively compared to its performance in 2021. At 9 AM EST, the valuation of the crypto market was down to US$ 890.97 billion after dropping 2.1 per cent over the previous day.

Dogecoin had clocked an all-time high of US$ 0.7376 apiece on May 8, 2021.

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