Elon Musk Faces Class-Action Lawsuit from Dogecoin Investors

• Financial

In the latest chapter of an ongoing legal saga, a group of Dogecoin investors has petitioned to revise a class-action lawsuit against Elon Musk reports CNN. The investors accuse Musk of using his substantial social media influence and media appearances to unfairly manipulate the market value of Dogecoin, a popular cryptocurrency.

The case, filed on May 31 in the United States District Court for the Southern District of New York, alleges that Musk reaped substantial profits from Dogecoin trades at the expense of other investors. This, they claim, was achieved by a calculated "course of cryptocurrency market manipulation," which included controversial changes to Musk's Twitter logo.

Musk's Twitter Activity: Catalyst for Controversy

One of the contentious points raised in the lawsuit was Musk's decision to swap his Twitter logo for the Dogecoin logo. This change is alleged to have contributed to a surge in the token's price, thereby enhancing Musk's personal trading profits.

“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,” read the amended lawsuit. The document went on to condemn Musk's actions, accusing him of exploiting "the earnest hopes of vulnerable Americans, including war veterans, blue collar workers, and the elderly." This amended lawsuit emerged on the heels of Musk's legal team's request to dismiss the second iteration of the lawsuit.

In an intriguing twist, Musk had altered his Twitter logo to the Dogecoin logo mere days after this legal move.

Musk's Influence on Cryptocurrency

Elon Musk, one of the wealthiest individuals globally, has long been vocal about Dogecoin and other cryptocurrencies.

His comments, delivered to his millions of Twitter followers, have frequently been associated with significant shifts in token prices. According to the claimants, Musk began his Dogecoin-related Twitter commentary in 2019, a habit that has continued unabated and under intense scrutiny.

As this lawsuit enters its next stage, market watchers and investors alike will be keen to see how this latest development will impact Musk's standing and the ever-volatile cryptocurrency market.