Dogecoin investors are suing Elon Musk, the founder of Tesla and SpaceX, accusing him of running a “pyramid scheme” to support the cryptocurrency, according to Reuters.
Investors filed a lawsuit in Manhattan Federal Court, accusing the billionaire of committing fraud and running a pyramid scheme to inflate the price of Dogecoin. They seek $258 billion in damages on behalf of Dogecoin investors who have lost money since Musk started promoting the cryptocurrency.
Further down the road, the plaintiffs were joined by seven more dissatisfied investors. Likewise, the list of defendants expanded. It now includes six more companies aside from Musk, Tesla, and SpaceX.
According to the amended complaint, Elon Musk and his companies deliberately caused a 36,000% spike in the price of Dogecoin and then left it to crash. “Defendants were aware since 2019 that Dogecoin had no value yet promoted Dogecoin to profit from its trading," the complaint said. Many investors, unaware of the fraud, invested in the token and suffered losses.
The original lawsuit against the CEO of Tesla and SpaceX, accusing him of manipulating the Dogecoin pyramid scheme, was filed in June 2022.
