Elon Musk, Tesla and SpaceX sued for promoting Dogecoin

17 Jun 2022

Tesla and SpaceX CEO Elon Musk is being sued $258 billion by an investor in Dogecoin, it was announced on Thursday, who accused the world’s richest man of operating a pyramid scheme to support the meme cryptocurrency.

U.S. citizen Keith Johnson is suing Musk, Tesla and SpaceX, as he claims he was “defrauded out of money” due to the billionaire’s endorsements.

The complaint, filed in federal court in Manhattan, states: "Defendants were aware since 2019 that Dogecoin had no value yet promoted Dogecoin to profit from its trading. Musk used his pedestal as World's Richest man to operate and manipulate the Dogecoin Pyramid Scheme for profit, exposure and amusement.

“Since defendant Musk and his corporations Spacex and Tesla Inc. began purchasing, developing, promoting, supporting, and operating dogecoin in 2019, [the] plaintiff and the class have lost approximately $86 billion in this crypto pyramid scheme.”

Indeed, Johnson is seeking $86 billion in damages, highlighting the fall in Dogecoin's market value since May last year, and wants three times more.

The complaint also contains comments from Warren Buffett, Bill Gates and others, questioning cryptocurrencies’ value, Reuters reports.

Following the news Johnson was suing Musk, Tesla and SpaceX, deVere boss Nigel Green stated: “The whole situation is depressingly predictable, I’m afraid.

“It was inevitable, as I warned in public last year on several occasions, that many novice retail investors would get burned in the Dogecoin frenzy.”

He added: “Investors should avoid being drawn into the hysteria driven by social media and ‘activist’ investors. Do your due diligence on the cryptocurrency before investing – not all cryptos are created equal.”

Dogecoin was trading on Thursday at around 5.8 cents, down from its May 2021 high of around 74 cents.