A multi-billion dollar lawsuit has been filed against Tesla CEO Elon Musk over engaging in the Dogecoin pyramid scheme. Keith Johnson has sued Musk, Tesla and SpaceX and is asking $258 billion in damages due to his massive wealth loss in trading Dogecoin, which was promoted by Musk and his companies.
Johnson is an American citizen and claims he was defrauded out of money by the defendants' 'Dogecoin crypto pyramid scheme'.
Block Musk And His Companies From Promoting Dogecoin
He also claimed that the billionaire and his companies constitute an illegal racketeering enterprise to inflate Dogecoin's price.
Johnson is seeking to represent a class of people who have lost money trading in Dogecoin since April 2019. He is asking for $86 billion in damages, plus triple damages of $172 billion, as well as an order blocking Musk and the companies from promoting Dogecoin, and declaring that Dogecoin trading constitutes gambling under U.S. and New York law, according to Forbes.
The court filing claimed that Dogecoin is not a currency or security and it's not also backed by gold or anything other. Dogecoin also doesn't pay any dividend or interest and it also doesn't have any unique utility similar to other cryptocurrencies.
Musk Has Been Promoting Dogecoin
"It's not secured by a government or private entity. It's simply a fraud whereby 'greater fools' are deceived into buying the coin at a higher price," stated the court filing.
It came after Musk earlier this year revealed that Tesla had started accepting Dogecoin for transactions in some of its online store.
The announcement triggered a jump in the value of Dogecoin. Apart from this move, Musk has been promoting Dogecoin in his tweets. The billionaire has millions of followers on Twitter and if he mentions any cryptocurrency in his tweets repeatedly, a jump in the value of the currency is certain.
Musk, Tesla, and SpaceX have not responded to the lawsuit so far. Dogecoin's value was highest in last year's May when it was 74 cents but currently one Dogecoin is just 6 cents.