Lucía Peña
A prolonged class-action lawsuit against Tesla CEO Elon Musk, accusing him of manipulating Dogecoin prices in 2021, has been officially resolved. The case, brought forward by a group of Dogecoin investors, alleged that Musk’s tweets and public stunts drove Dogecoin’s price volatility to their detriment.
As per Reuters, the fourth amended complaint had been dismissed on August 29. However, cross-motions and appeals were filed by both Musk and the investors in October. On Thursday night, a stipulation was filed in Manhattan federal court to dismiss both the appeal and the motions. The resolution awaits approval by U.S. District Judge Alvin Hellerstein.
The lawsuit revolved around Dogecoin’s meteoric rise in 2021, when the cryptocurrency surged from under $0.10 to nearly $0.70. The plaintiffs claimed Musk leveraged his Twitter activity, appearances on platforms like Saturday Night Live, and public statements to manipulate the memecoin’s price.
Musk was accused of making exaggerated claims about DOGE, including suggesting it could become the global financial system’s standard and promising to send a DOGE to the moon aboard SpaceX.
However, Judge Hellerstein dismissed the claims, stating, “These statements are aspirational and puffery, not factual assertions. They cannot form the basis of a 10b-5 lawsuit, as no reasonable investor could rely on them.”
Interestingly, the lawsuit’s resolution coincided with Musk being appointed as the head of President-elect Donald Trump’s Department of Government Efficiency (DOGE) initiative. This program aims to introduce large-scale structural reforms to the government using innovative, entrepreneurial approaches.
DOGE has seen significant price movement since Election Day on November 5. Trading at $0.36 as of November 15, it has more than doubled in value and now boasts a market cap of $53 billion, positioning it as the sixth-largest cryptocurrency.
Musk and Dogecoin: A Humorous Relationship
Dogecoin was initially created as a joke in 2013 by software engineers Billy Markus and Jackson Palmer. Musk, known for his lighthearted relationship with the cryptocurrency, has consistently denied any active involvement in crypto trading.
“I just make Dogecoin jokes because I like its humor. It has dogs, memes, and a good sense of fun,” Musk said in a recent statement.
The plaintiffs also accused Musk of insider trading, alleging he sold $124 million worth of DOGE. However, Musk and Tesla refuted these claims, asserting there was no evidence linking them to the crypto wallets in question or proof of DOGE sales during the period in question.
