Elon Musk Dogecoin (DOGE)

‘A Legitimate Cryptocurrency’: Musk Calls for Scrapping of $248B Dogecoin Lawsuit

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Lawyers operating on behalf of Elon Musk have called for the dismissal of a US$258 billion (AU$387 billion) class-action lawsuit, filed by crypto investors who allege that Musk ran a ‘pyramid scheme’ to promote the popular meme-based cryptocurrency Dogecoin (DOGE).

According to a recent Reuters report, Musk’s lawyers argued that the lawsuit against the CEO of Tesla, SpaceX and Twitter was a “fanciful work of fiction” in Manhattan’s federal court on March 31.

Filed in the New York District Court in June of last year, the lawsuit alleges that Musk “used his pedestal as World’s Richest man to operate and manipulate the Dogecoin Pyramid Scheme for profit, exposure, and amusement.”

Musk’s lawyers countered, saying that the eccentric billionaire’s support for Dogecoin, usually taking the form of somewhat humorous and satirical posts on Twitter, was “too vague” to be the subject of a fraud claim.

“There is nothing unlawful about tweeting words of support for, or funny pictures about, a legitimate cryptocurrency that continues to hold a market cap of nearly $10 billion.”

Elon Musk’s legal counsel

For context, Musk has tweeted about Dogecoin on a number of different occasions, even going as far as calling himself the “Dogefather” and “CEO of Dogecoin” in the ‘bio’ section of his Twitter profile. In May last year, Musk announced that two of his companies Tesla and SpaceX would begin accepting Dogecoin as payment for merch and other niche products.

Musk’s SNL appearance spells bad news for Dogecoin

The crux of the lawsuit is reportedly aimed at Musk’s May 2021 appearance on Saturday Night Live, where he acted as a “fictitious financial expert” and proceeded to call Dogecoin a “hustle”. In the days following the episode’s broadcast, the price of Dogecoin plummeted more than 40%, its value plunging from an all-time-high of US$0.73 (AU$1.10) on Monday May 9 to just US$0.41 (AU$0.41) on Thursday May 11.

Additionally, the lawsuit demands that the trading of Dogecoin be legally considered as “gambling” both within the state of New York and under federal law. As a result of this, the lawsuit also claims that Musk and his two most senior companies, Tesla and SpaceX, have violated state and federal gambling laws.

Even though Evan Spencer, the lawyer representing the class-action clients in the multi-billion-dollar lawsuit, claims that he’s “more confident than ever” the case will rule in favour of the slighted Dogecoin investors, Elon Musk has informed his Twitter followers on numerous occasions that he would not sell any of his crypto holdings including, Bitcoin (BTC) and Dogecoin under any circumstances.

Whether or not the lawsuit will be successful in claiming a whopping US$248 billion in damages from the Tesla CEO remains to be seen.