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Tesla’s founder and CEO and, for a short while, the CEO of Twitter, is currently facing a $258 billion lawsuit for an alleged Dogecoin pyramid scheme. The court case claims Musk was part of a racketeering scheme to back the cryptocurrency.
According to a court filing submitted on June 7, 2023, Musk is accused of selling 1.4 billion Dogecoin, worth over $124 million. The records state two different wallets, supposedly belonging to the billionaire, offloaded the tokens.
This alleged profit-taking occurred during a two-day period in April (4-6), when Twitter replaced its classic blue bird icon for the image of Dogecoin’s logo, a Shiba Inu dog. Price aggregator Coingecko, however, pointed to a drop in the token’s price, from $0.095 to $0.085, during those two days.
Elon Musk’s attorney, Alex Shapiro, has denied these allegations, according to a letter obtained by The New York Post. “You specifically allege, without basis, that the following wallets ‘belong’ to [Musk],” it reads. “The sole basis for your claim is that these wallets sold Dogecoin at a time when, according to the Third Amended Complaint, prices were up.”
A group of DOGE investors had already amended the lawsuit in late May, when they accused Musk with manipulative practices that pumped the token’s price. That filing accuses him of “transparent cryptocurrency market manipulation,” saying that Musk was exploiting his impressive Twitter following and subsequent appearance on NBC's Saturday Night Live.
Musk, the self-proclaimed “Dogefather” and “Dogecoin CEO” has not shied away from his favoritism of the meme coin. He has repeatedly taken to social media to “tweet the token,” garnering his recent encounters with the law.
Invented as a joke in 2013 for the cryptocurrency community to stop taking itself so seriously, the infamous meme coin has surged in popularity and in price. It currently is the ninth largest token by market capitalization on CoinGecko, trading hands at $0.06 with an astounding $8.7 billion dollar market cap.
Is Elon Musk Dogecoin’s mysterious whale or just a Twitter troll? That’s up for the judge to decide.