- Elon Musk is accused of Dogecoin price manipulation, a claim that has landed him in an insider trading lawsuit.
- The class action comes as DOGE investors claim to have suffered billions of dollars in losses.
- April's temporary Twitter logo switch features among the accusations, with Musk accused of up to 36,000% pump-crash.
- This comes days after the Wahi brothers were released from a similar case by the SEC.
Dogecoin (DOGE) investors have accused Twitter CEO Elon Musk of insider trading, citing manipulation of the asset's price. The plaintiffs say Musk's actions have cost them billions of dollars in losses. An excerpt from the filing reads:
This is a securities fraud class action arising from a deliberate course of carnival barking, market manipulation, and insider trading enabled Musk to defraud investors and promote himself and his companies.
The investors also accuse Musk of benefitting his companies, Twitter, SpaceX, and Tesla, at the expense of Dogecoin and its community. The update was posted by whale wallet tracker on Twitter Whale Alert (@whale_alert), and corroborated by Reuters.
Also Read: Elon Musk warns traders against "betting the farm" on his favorite cryptocurrency Dogecoin
Dogecoin investors bring insider trading charges on Elon Musk
Dogecoin (DOGE) investors want Elon Musk, the self-proclaimed Doge father, to be charged with insider trading for manipulating the price of the largest meme coin by market cap. The news sprouts from a May 31 filing in Manhattan federal court where the plaintiffs alleged numerous 'publicity stunts" used by the Twitter and electric car manufacturer CEO "to trade profitably at their expense through several Dogecoin wallets that he or Tesla controls."
Among the issues cited in the class action lawsuit include the April stunt where Elon Musk changed the Twitter logo from the traditional bird symbol to a Shiba Inu (SHIB) dog, as FXStreet reported. Reportedly, the move, which inspired a 30% Dogecoin price surge, saw the famous billionaire investor rake in massive profits of up to $124 million.
Based on the class action, Musk has driven up Dogecoin price by over 36,000% within a two-year span, only to let it crash to his advantage. Notably, the latest accusation has also been featured in the proposed third amended complaint of the June 2022 lawsuit, which US District Judge Alvin Hellerstein said would "likely" hold, as the defendants may not be prejudiced. As reported, Musk pushed for dismissing the second amended $258 billion lawsuit, claiming it was a "fanciful work of fiction."
Insider trading becomes commonplace in crypto
Contrary to regulation, insider trading is becoming a headlining topic in crypto. Barely two days ago, the US Securities and Exchanges Commission (SEC) reached a settlement with Ishan and Nikhil Wahi over claims by the regulator that the nine tokens listed by Coinbase are securities. Notably, these tokens are AMP, RLY, DDX, XYO, RGT, LCX, POWR, DFX, and KROM, and Wahi admitted to trading them with inside knowledge.
Binance CEO Changpeng Zhao (CZ) separated himself and his staff from such pitfalls in his March 28 response to the Commodity Futures Trading Commission (CFTC).
The exchange has a '90-day no-day trading rule' for employees, preventing them from selling a coin within 90 days of their latest buy or vice versa. In so doing, the exchange ensures employees do not trade actively, alongside other measures, including a 'no-futures trading' policy and stark regulations against buying or selling into listings and launch pads.
Dogecoin (DOGE) price remains undeterred by the development, recording a $0.34% daily rise and a 0.18% increase within the hour after the news broke.
Also Read: Will Binance CEO Changpeng "CZ" Zhao be the next Elon Musk for meme coins?
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
Bitcoin Weekly Forecast: BTC nosedives below $95,000 as spot ETFs record highest daily outflow since launch
Bitcoin price continues to edge down, trading below $95,000 on Friday after declining more than 9% this week. Bitcoin US spot ETFs recorded the highest single-day outflow on Thursday since their launch in January.
Bitcoin crashes to $96,000, altcoins bleed: Top trades for sidelined buyers
Bitcoin (BTC) slipped under the $100,000 milestone and touched the $96,000 level briefly on Friday, a sharp decline that has also hit hard prices of other altcoins and particularly meme coins.
Solana Price Forecast: SOL’s technical outlook and on-chain metrics hint at a double-digit correction
Solana (SOL) price trades in red below $194 on Friday after declining more than 13% this week. The recent downturn has led to $38 million in total liquidations, with over $33 million coming from long positions.
SEC approves Hashdex and Franklin Templeton's combined Bitcoin and Ethereum crypto index ETFs
The SEC approved Hashdex's proposal for a crypto index ETF. The ETF currently features Bitcoin and Ethereum, with possible additions in the future. The agency also approved Franklin Templeton's amendment to its Cboe BZX for a crypto index ETF.
Bitcoin: 2025 outlook brightens on expectations of US pro-crypto policy
Bitcoin (BTC) price has surged more than 140% in 2024, reaching the $100K milestone in early December. The rally was driven by the launch of Bitcoin Spot Exchange Traded Funds (ETFs) in January and the reduced supply following the fourth halving event in April.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.