Elon Musk’s well-known assist for Dogecoin has landed the billionaire entrepreneur a $248 billion lawsuit from a cryptocurrency investor for allegedly working a pyramid scheme.

In a criticism filed in federal court docket in Manhattan, plaintiff Keith Johnson accused Musk of racketeering for touting Dogecoin and driving up its value, solely to then let the worth tumble. The accusations are critical however look like fairly troublesome to reveal.

“Defendants had been conscious since 2019 that Dogecoin had no worth but promoted Dogecoin to revenue from its buying and selling. Musk used his pedestal as World’s Richest man to function and manipulate the Dogecoin Pyramid Scheme for revenue, publicity and amusement.”

Excerpt from Keith Johnson’s criticism

Within the criticism, the plaintiff argues that Dogecoin’s selloff started across the time Musk hosted the NBC present “Saturday Evening Dwell,” on which event he referred to as Dogecoin “a hustle” whereas taking part in a fictitious monetary professional on the present’s “Weekend Replace” section (see video on the prime of this web page).

Johnson is searching for $86 billion in damages, representing the decline in Dogecoin’s market worth since Might 2021, and needs the sum tripled. He additionally seeks to dam Musk and his firms from selling Dogecoin and a choose to declare that buying and selling Dogecoin is playing beneath federal and New York legislation.

Reuters reached out to a lawyer for Keith Johnson asking what particular proof his shopper has or expects to have that proves Dogecoin is nugatory and the defendants ran a pyramid scheme. The information company didn’t obtain a reply.

Elon Musk brazenly supported Dogecoin in 2021, tweeting in Might that he was working with the cryptocurrency’s builders to enhance transaction effectivity. Earlier within the 12 months, he even ran a ballot on social media asking if Tesla ought to settle for Dogecoin as a type of fee. Then in Might 2022, he stated on Twitter that Dogecoin can be utilized to purchase Tesla and SpaceX merchandise. 

In line with Investopedia, Dogecoin was began in 2013 by Jackson Palmer and Billy Markus, initially as a joke primarily based on a well-liked meme that includes a Shiba Inu canine. 

Whereas created seemingly as a joke—it has the picture of a Shiba Inu as its brand—the peer-to-peer, open-source cryptocurrency is derived from Litecoin and makes use of the identical proof-of-work expertise. Notable options are its low value and limitless provide, which is why it’s labeled as an “inflationary coin.” It’s usually used as a tipping foreign money for social media content material by a loyal neighborhood of supporters.