(Observer Network) According to Reuters local time on June 16th, Elon Musk, the world's richest man, and his subsidiaries Tesla and SpaceX were sued by a dog coin investor on the same day. The other party accuses Musk of deliberately implementing a "cryptocurrency pyramid scheme (pyramid scheme)" on Twitter, directly "manipulating" the price of dog coins, and demands compensation of $258 billion (approximately RMB 1
(Observer Network) According to Reuters local time on June 16th, Elon Musk, the world's richest man, and his subsidiaries Tesla and SpaceX were sued by a dog coin investor on the same day. The other party accuses Musk of deliberately implementing a "cryptocurrency pyramid scheme (pyramid scheme)" on Twitter, directly "manipulating" the price of dog coins, and demands compensation of $258 billion (approximately RMB 1.73 trillion) from Musk.
The prosecutor, named Keith Johnson, accused Musk and his Tesla and SpaceX companies of extortion in his lawsuit filed in the Federal Court of Manhattan, New York. He claimed that Musk and his company first spread rumors of selling dog coins, driving up their prices, and then causing them to plummet, thereby profiting from the situation.
The defendants have known since 2019 that Dogcoin has no value, but they are still promoting Dogcoin and profiting from the transaction, "Johnson wrote in his indictment." Musk used his position as the world's richest man to operate and manipulate Dogcoin pyramid scams to gain profits, increase exposure, and have fun for himself
Johnson also referred to Dogcoin as an "illegal telecommunications fraud enterprise" promoted and manipulated through Twitter. He requested the court to order a ban on Musk's promotion of dog coins, and declared trading dog coins a form of gambling under federal and New York laws.
Image source: Gougou Coin official website
It is reported that the cryptocurrency dog coin was founded by former IBM engineer Marcus and Adobe software engineer Jackson Palmer in 2013. At that time, Doge's emoticons were popular on the internet, and Palmer co founded Dogecoin with Marcus to satirize the speculative craze in the cryptocurrency market.
After the launch of Dog Coin, it became popular on platforms including Reddit due to its low price, and became a popular virtual currency for online rewards.
In 2019, Elon Musk joined the game and purchased a large amount of dog coins. He used his influence to frequently promote dog coins on Twitter, calling them "people's cryptocurrency" and his "favorite" currency. He also released dog coin emoticons multiple times. And every time he posts, the price of dog coins will inevitably rise accordingly. In addition, Tesla and SpaceX, both under Musk's umbrella, have previously stated that they allow customers to use Dogcoin to pay for purchases, further pushing up the price of Dogcoin.
Musk Twitter sends emoticons to promote dog coins
Johnson stated in the indictment that Musk's sale of dog coins began in May last year. Musk appeared in the old American entertainment variety show "Saturday Night Live" (SNL), in which he played a fictional cryptocurrency expert. When the host asked him what the dog coin was, Musk replied, "It's just a scam." The dog coin plummeted in an avalanche, and its trading price fell by 38.6% at one point.
Reuters reported that as of the 16th, the price of dog coins had plummeted from its peak of $0.74 per coin in May last year to $0.058 per coin, with a market value drop of $86 billion. Johnson demanded compensation from Musk for three times this amount, $258 billion.
In addition, Johnson is seeking to turn this lawsuit into a class action lawsuit, hoping to represent all damaged Dogcoin investors and sue Musk, Tesla, and SpaceX.
As of now, Musk has not responded to this matter.
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