Called ;Dogefather’, Musk has long been a vocal proponent of Dogecoin and tweeted several times in the past to help spike the price of the digital token.
A class-action lawsuit has been filed in a federal court in Manhattan, and the Dogecoin investor called for triple the damages of $86 billion, which is how much the plaintiff alleges has been lost by Dogecoin investors since Musk started tweeting about it, reports TechCrunch.
Currently, Dogecoin cryptocurrency has tumbled from its high of nearly $0.74 to just over $0.05 in recent days.
“Defendants falsely and deceptively claim that Dogecoin is a legitimate investment when it has no value at all,” the plaintiff Keith Johnson said in the complaint.
“Since Defendant Musk and his corporations SpaceX and Tesla, Inc began purchasing, developing, promoting, supporting and operating Dogecoin in 2019, Plaintiff and the class have lost approximately $86 billion in this Crypto Pyramid Scheme,” he added.
Musk was yet to react to the class-action lawsuit.
Earlier this year, Musk announced that the company’s supercharging stations will accept cryptocurrency Dogecoin as payment.
“Of course, you can pay in Doge (sic),” said Musk in response to a tweet.
Tesla does accept Doge in its online store and there have been rumours of Tesla eventually accepting the crypto as a form of payment for its vehicles.
In a recent interview, Musk endorsed Dogecoin over any other crypto coin.
“The transaction value of Bitcoin is low and the cost per transaction is high. At least at a space level, it is suitable as a store of value. But fundamentally, Bitcoin is not a good substitute for transactional currency,” he said.
Musk has confirmed that he has a significant personal investment into Bitcoin on top of Tesla’s investment and he has smaller Ethereum and Dogecoin holdings.