Elon Musk is being sued for $258 billion because of Dogecoin

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Yes, billion.

Elon Musk pulling a jokey face at the camera.
(Image credit: Bloomberg via Getty Images)

Elon Musk, Tesla, and SpaceX are being sued for an astounding $258 billion—not a typo, that's billion—for running a pyramid scheme through the Dogecoin cryptocurrency. According to a Reuters report, the suit was filed by Dogecoin investor Keith Johnson, who accused Musk of using his wealth and position as CEO of the two companies to promote Dogecoin to drive up its price, before ultimately letting it fall.

"Defendants were aware since 2019 that Dogecoin had no value yet promoted Dogecoin to profit from its trading," the complaint says. "Musk used his pedestal as World's Richest man to operate and manipulate the Dogecoin Pyramid Scheme for profit, exposure and amusement."

Dogecoin was introduced in 2013 mainly as a joke, but there is no such thing as satire under capitalism, and in very short order it became the first meme coin, and a legitimate (such as they are) cryptocurrency. Its value was flatlined near zero for years until Musk tweeted about it in late 2020, which caused a sharp jump in price. Subsequent tweets in 2021 pushed it even higher; it peaked in May 2021 at $0.74 but has since come crashing down, shedding more than 90% of its price, and currently sits at roughly $0.06.

Ironically, the suit claims that the Dogecoin dump began when Musk hosted Saturday Night Live, which also happened in May 2021: During a Weekend Update segment, Musk appeared as a cryptocurrency expert, but after trying and failing several times to explain what Dogecoin is, he ultimately agreed with the host that the whole thing is "a hustle."

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Johnson wants Musk and his companies prohibited from promoting Dogecoin, and for trading Dogecoin to be declared gambling under federal and state laws. He also wants, again, $258 billion: $86 billion in actual damages, representing the loss of Dogecoin value since May 2021, plus a claim for treble damages. It seems like a long shot—filing a lawsuit is a long way from winning one (or even having it heard) and even if Johnson comes out on top, Musk is rich but he's not that rich—but I guess if you're going to take a shot, you might as well aim high.

Musk isn't the only wealthy person to run into trouble for promoting Dogecoin. Former anti-virus guru John McAfee was charged with fraud in 2021 for running schemes involving multiple cryptocurrencies including Dogecoin. Shortly before McAfee was scheduled to be extradited to the US to face charges, he was found dead in a Spanish prison cell.

Andy Chalk
Andy Chalk
US News Lead

Andy has been gaming on PCs from the very beginning, starting as a youngster with text adventures and primitive action games on a cassette-based TRS80. From there he graduated to the glory days of Sierra Online adventures and Microprose sims, ran a local BBS, learned how to build PCs, and developed a longstanding love of RPGs, immersive sims, and shooters. He began writing videogame news in 2007 for The Escapist and somehow managed to avoid getting fired until 2014, when he joined the storied ranks of PC Gamer. He covers all aspects of the industry, from new game announcements and patch notes to legal disputes, Twitch beefs, esports, and Henry Cavill. Lots of Henry Cavill.