The Big Cryptocurrency Scam of Dogecoin, potential Crypto Ponzi Scheme lawsuit against Musk

Elon Musk, the world’s richest man, and his companies Tesla and SpaceX, a space exploration technology company, are being sued by a U.S. Dogecoin investor for $258 billion (about RMB 1.7 trillion).

Dogecoin is a community-driven cryptocurrency with a mascot inspired by the Shiba Inu meme (Shiba Inu terrier). The dogecoin core software allows anyone to run nodes on the dogecoin blockchain network, using the scrypt hash function to prove the workload. The dogecoin code has been adopted from Bitcoin Core and Litecoin.

Dogecoin (DOGE) is a community-driven meme cryptocurrency that, like Bitcoin, is used as a medium of exchange for value. Dogecoin is primarily used in a tipping system on Reddit and Twitter that rewards people who create or share quality content. There is no cap on the supply of dogecoin, with inflation at 5 billion DOGE per year, or about 13% of the circulating supply. Nasdaq estimates that its inflation rate will fall to 2.4% by 2040, which is the current rate of inflation of the U.S. dollar, and will continue to fall over time.

Unlike Bitcoin’s Proof of Work (PW) algorithm, Dogecoin uses the same scrypt technology as Litecoin. Miners can complete and record transactions faster and easier, making Dogecoin more efficient at processing payments. It takes 10 minutes for Bitcoin to generate a new block, but only one minute for Dogecoin. Dogecoin miners can use GPUs to mine the digital currency and have been mining Litecoin in addition to Dogecoin since 2014.

Dogecoin investors took Tesla CEO Musk to court on Thursday (local time), accusing him of running a Ponzi scheme to support Dogecoin and demanding $258 billion from him. In a lawsuit filed in a Manhattan federal court, plaintiff Keith Johnson accuses Musk, Tesla, and SpaceX of “engaging in racketeering by promoting Dogecoin and driving up its price, only to have it subsequently crash. The lawsuit alleges that the defendants knew Dogecoin had no value since 2019 but touted it to profit from trading it. Musk used his position as the richest man in the world to operate and manipulate the Dogecoin pyramid scheme for profit, exposure, and fun. He claims to have been branded by the “cryptocurrency pyramid scam” involving Musk and his company.