- Dogecoin investors have filed a class action lawsuit accusing Elon Musk of insider trading and manipulating the DOGE prices, resulting in significant losses for investors.
- The lawsuit also alleges that Musk engaged in “publicity stunts” and profited from trading Dogecoin through wallets controlled by him or Tesla, at the expense of investors.
Billionaire Elon Musk is facing fresh accusations as Dogecoin investors filed a class action lawsuit accusing Musk of insider trading. The lawsuit accuses Musk of manipulating the Dogecoin (DOGE) prices leading to billions of dollars in losses for the investors.
As per the Wednesday night filing with the Manhattan federal court, the DOGE investors noted that Mr. Musk used Twitter posts, his 2021 appearance on NBC’s Saturday Night Live television programme, as well as paid online influencers in pushing the Dogecoin (DOGE) price higher.
Besides, the lawsuit also accuses Musk of “publicity stunts” and trading profitably through several Dogecoin wallets that he or Tesla controls, at the expense of investors. The lawsuit mentions the popular episode where Mr. Musk replaced the Twitter logo with the Shiba Inu dog pic following which the DOGE price surged by more than 30% in a matter of days. Investors claim that billionaire Elon Musk sold about US$124 million (S$167 million) worth of Dogecoin in April.
The lawsuit notes that Mr. Musk engaged in a “deliberate course of carnival barking, market manipulation, and insider trading” which enabled him to defraud investors, and promote himself and his companies. The filing notes:
This is a securities fraud class action arising from a deliberate course of carnival barking market manipulation and insider trading by the world’s richest man Elon Musk.
Elon Musk and Crypto
Billionaire Elon Musk has been one of the strong proponents of cryptocurrencies and holds a special affinity for Dogecoin (DOGE). Elon Musk’s electric car company Tesla also holds a sizeable amount of Bitcoins on its balance sheet.
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This is not the first time that Elon Musk has been accused of manipulating crypto prices. The recent accusations are part of a proposed third amended complaint in an ongoing lawsuit that started in June of the previous year. Musk and Tesla had previously attempted to dismiss the second amended complaint, considering it a “fanciful work of fiction.” However, on May 26, U.S. District Judge Alvin Hellerstein expressed his inclination to permit the third amended complaint, suggesting that the defendants would not be prejudiced.
Investors have accused Elon Musk in the past as well of deliberately driving up Dogecoin’s (DOGE) price by more than 36,000 percent over the last two years and then allowing it to crash. Earlier this year in March, Elon Musk and his team sought the dismissal of the second amended complaint while calling it a “fanciful work of friction”.
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