Elon Musk is accused of orchestrating a pyramid scheme to promote the cryptocurrency Dogecoin in the $258 billion racketeering complaint, which has grown to include six other defendants as well as his tunnel building company, Boring Co., and seven additional investor plaintiffs.
The price of Dogecoin was purposefully driven up by more than 36,000% over the course of two years, according to an amended complaint that was filed on Tuesday evening in Manhattan federal court by Musk, his electric car company Tesla Inc., his space tourism company SpaceX, Boring, and other parties. Then, the price was allowed to crash.
Despite knowing all along that the currency had no inherent worth and that its value “depended purely on marketing,” the defendants “profited tens of billions of dollars” as a result at the cost of other Dogecoin investors, the lawsuit said.
Requests for comment on Wednesday were not immediately answered by Tesla, SpaceX, or Boring. In 2020, Tesla closed its public relations division.
In June, the first lawsuit was submitted
According to the revised lawsuit, shortly after that, the wealthiest man in the world, Elon Musk, tweeted that he would “keep supporting Dogecoin” and claimed in an interview that “those who work near the plant at SpaceX or Tesla” requested him for such support.
The Dogecoin Foundation, which describes itself as a nonprofit organization that oversees and supports Dogecoin, is one of the additional new defendants. It could not be contacted right away for comment.
The anticipated $258 billion in losses is treble the market value fall of Dogecoin from May 2021.
Around that time, Musk dubbed Dogecoin “a scam” while portraying a fake financial expert on an episode of “Saturday Night Live” on NBC.
On Wednesday, Dogecoin was trading at roughly 6 cents, down from about 74 cents in May 2021.
Johnson v. Musk et al., U.S. District Court, Southern District of New York, No. 22-05037, is the matter at hand.