This Defendant Wants a Judge to Declare Crypto Trading as Gambling in New York
On Thursday, a class-action suit was brought against Elon Musk and his companies, Tesla and SpaceX, by an investor who claims that the tech influencer ran a pyramid scheme by promoting Dogecoin (DOGE), a cryptocurrency.
The plaintiff, Keith Johnson, sued Elon Musk for $258 billion in a complaint filed in a Manhattan Federal Court.
He alleges that the world’s richest man was deliberately pumping and dumping DOGE.
The sum is a result of the $86 billion drop in the market capitalization of DOGE, thereby asking for a triple in damages.
The complaint reads:
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.
Declare Crypto Trading as Gambling Demands
Apart from claiming $258 billion in damages, Johnson wants to block Musk and his companies from promoting DOGE and a judge to declare that crypto trading is gambling under Federal and New York laws.
Tesla, SpaceX, and Elon’s lawyer did not immediately respond to requests for comment.
A lawyer for Johnson did not immediately respond to requests for comment on what specific evidence his client has or expects to have that proves Dogecoin is worthless and promoters were running a pyramid scheme.
Elon Musk Actively Comments on Tech and Crypto Projects
Johnson’s action has since stirred mixed reactions. While some believe that it is no case of a pyramid scheme as alleged, others blame the defendant for making financial investment decisions based on Musk’s tweets.
Over the years, Musk has remained an active and influential character in the crypto and tech space. His comments on various topics, including individual projects such as Bitcoin and Dogecoin, have, in some instances, caused prices to rally.
For instance, prices rose after Tesla said it would acquire $1.5 billion of BTC.
Tesla & Bitcoin pic.twitter.com/YSswJmVZhP
— Elon Musk (@elonmusk) May 12, 2021
However, prices crashed a few weeks later when the electric company reneged on its decision to accept BTC, citing environmental concerns due to Bitcoin mining’s energy requirements.