Elon Musk Has Been Sued For $258 Billion Over Alleged Dogecoin Pyramid Scheme

Elon Musk is being sued for a whopping $258 billion ($AUD 366 billion, £147 billion) amid claims the tech billionaire and his companies engaged in racketeering schemes to inflate Dogecoin's value.

Dogecoin is a cryptocurrency, like Bitcoin, but far less influential.

According to Coinbase, a cryptocurrency exchange, it was created as a joke and is a reference to a popular internet meme.

It was massively boosted by Musk after he began tweeting about it in early 2021.

Plaintiff Keith Johnson described himself 'as an American citizen who was defrauded out of money by defendants' Dogecoin Crypto Pyramid Scheme' in federal court papers filed in Lower Manhattan, Bloomberg reports.

The lawsuit names Musk as well as his companies Tesla and SpaceX.

Johnson is seeking $86 billion ($AUD 122 billion, £49 billion) in damages as well as tripled damages of $172 billion ($AUD 244 billion, £98 billion) for losses incurred from trading Dogecoin since 2019.

"Dogecoin is not a currency, stock, or security. It’s not backed by gold, other precious metal, or anything at all," Johnson said in the court filing, as per the New York Post.

"You can’t eat it, grow it, or wear it. It doesn’t pay interest or dividend. It has no unique utility compared to other cryptocurrencies…It’s not secured by a government or private entity."

The lawsuit added: "It’s simply a fraud whereby ‘greater fools’ are deceived into buying the coin at a higher price."

The lawsuit also demands that Musk and his companies stop promoting the meme-themed cryptocurrency.

At time of writing, Dogecoin was worth just over five cents, a far cry from its glory days in May 2021 when it was worth 74 cents.

Musk has a net worth was valued by Forbes at $202 billion ($AUD 287 billion, £115 billion) and is the world's richest man.

He also appears to be on track to be the world's first trillionaire.

Musk, Tesla, and SpaceX have not responded to the lawsuit.

In January, Musk revealed that Tesla had begun accepting the cryptocurrency for purchases in its online store, according to the New York Post.

SpaceX also previously boasted that they planned to launch a rocket to the moon entirely funded by Dogecoin.

In a statement, SpaceX's Vice President of Commercial Sales Tom Ochinero said: "This mission will demonstrate the application of cryptocurrency beyond Earth orbit and set the foundation for interplanetary commerce.

"We're excited to launch DOGE-1 to the Moon!"