On Sunday, Dogecoin (DOGE) surged by more than 10 percent after Elon Musk tweeted that he will “continue to support Dogecoin.” In the following response to a follower who advised him to “Keep purchasing it then,” Musk responded “I am,” implying that he had been amassing the meme currency the whole time.
Elon’s remarks came less than a week after a $258 billion class-action lawsuit was launched against the Tesla CEO, Tesla, and SpaceX for allegedly operating a bitcoin pyramid scheme. Bloomberg reported on Thursday that Elon was accused of inflating dogecoin and orchestrating a racketeering operation via his enterprises to support the cryptocurrency.
“Defendants falsely and fraudulently assert that Dogecoin is a legal investment, despite the fact that it has no value whatsoever.” In the complaint, the plaintiff in the class-action lawsuit, Keith Johnson, stated: Further, he accused Musk of utilising his position as the world’s wealthiest man to control and manipulate the Dogecoin pyramid scheme for profit, publicity, and entertainment.
Since 2019, Keith and the represented class claimed they had lost around $86 billion due to Elon’s dogecoin influence. Keith also requested that the plaintiffs be awarded $172B in treble damages.
Dogecoin, which was first created as a joke in 2013 to poke fun at Bitcoin, has progressively grown from an obscure “meme currency” to one of the biggest cryptocurrencies. At one time, the market capitalization of the currency surpassed $88 billion, surpassing a list of well-established S&P 500 companies.
Elon Musk joined the Doge bandwagon in 2019 and was one of its strongest advocates during its heyday. At various times, the CEO of Tesla has made tweets intended to “moon” the price of the cryptocurrency. As many individuals depended on Musk’s investing advice, Binance’s CEO Changpeng Zhao “CZ” once warned Musk from using his power to manipulate prices.
Musk began pushing the meme currency objectively, complimenting it for being carbon-friendly and having cheap transaction fees compared to other cryptocurrencies like Bitcoin. Later, he would attempt to substantiate his assertions by introducing doge payments for Tesla products, with intentions to do the same for SpaceX and Starlink. Mark Cuban, an owner of the Dallas Mavericks, is another billionaire who has openly backed DOGE.
As of this writing, the price of Dogecoin has risen to $0.057 after Musk’s remarks. However, the price is still 92 percent lower than its all-time high of $0.73 in May 2021. Doge is now the tenth-largest cryptocurrency, with a market worth of $7.6 billion.