In the ongoing legal saga surrounding Dogecoin, the latest chapter has taken an unexpected twist. A group of investors has filed a lawsuit seeking a staggering $258 billion in damages against Elon Musk and the Dogecoin Foundation. This legal battle has brought to light a host of allegations involving major influencers in the Dogecoin community who are accused of aiding the defendants by generating positive content on social media in exchange for undisclosed benefits, including royalties linked to impressions on X (formerly Twitter).
The Accused Influencers
Among the individuals accused of aiding Elon Musk and the Dogecoin Foundation are Billy Markus, known by the pseudonym Shibetoshi Nakamoto, and a prominent Dogecoin community member known as Mishaboar. Both Markus and Mishaboar have vehemently denied the allegations and expressed their surprise at being included in the lawsuit.
Billy Markus, the co-creator of Dogecoin, was one of the first to respond to the accusations. In his statement, Markus highlighted the inaccuracies in the lawsuit. He pointed out that he is not associated with Elon Musk, contrary to the claims made in the legal documents. Additionally, Markus noted that he had posted negative comments about Dogecoin in the past and had resigned from his non-role in the Dogecoin Foundation some time ago, making it clear that he was not involved in any conspiracy.
Mishaboar, a prominent member of the Dogecoin community, also took to social media to express their frustration at being labeled a Musk sycophant. They clarified that their interactions with Musk on social media were not always positive and that they had received criticism from him, which had even led to temporary shadowbans on their account. Mishaboar adamantly denied receiving any advertising revenue from X and reaffirmed their commitment to educating users about Dogecoin and cryptocurrency in general.
The Ongoing Lawsuit
As this lawsuit unfolds, it raises several questions about its potential impact on the broader Dogecoin community and whether the sought-after $258 billion in damages will hold up in court. The legal battle has brought attention to the role of social media influencers in shaping the perception and popularity of cryptocurrencies.
This case also highlights the need for transparency and ethical practices within the cryptocurrency industry. The accusations of undisclosed benefits and royalties for generating positive content underscore the importance of clear disclosure in influencer marketing and online endorsements.
New York DFS Strengthens Oversight of Cryptocurrencies
In related news, the New York State Department of Financial Services (DFS) took a significant step in enhancing its oversight of virtual currencies on Monday, reaffirming its commitment to regulating the digital asset space. Superintendent Adrienne A. Harris issued an update on the DFS's ongoing initiative to strengthen its oversight of virtual currencies. This update includes an updated list of cryptocurrencies approved for all licensees to list or custody, as well as new guidance for coin-listing policies.
The financial regulatory authority in New York has substantially decreased the roster of cryptocurrencies that licensed cryptocurrency trading platforms can automatically include in their offerings. Notably, XRP, dogecoin, litecoin, and ethereum classic have been excluded from the list of approved cryptocurrencies. Additionally, the regulator has introduced new cryptocurrency guidelines aimed at bolstering risk assessment standards for coin-listing procedures and customizing more rigorous criteria for businesses that interact with retail consumers.
The Greenlist: Simplifying Cryptocurrency Approvals
The DFS introduced the concept of the "Greenlist," which is a list of cryptocurrencies that can be listed or held in custody by entities licensed or chartered by the DFS to conduct virtual currency business activities in New York. Notably, the DFS now allows these entities to list coins on the Greenlist without having a separate DFS-approved coin-listing policy.
However, there is a caveat; if a cryptocurrency entity decides to list a coin on the Greenlist, it must notify the DFS at least 10 days prior to offering the coin in New York. This notification process allows the DFS to maintain oversight and ensure compliance with state regulations.
The current Greenlist, as of the announcement, includes cryptocurrencies such as bitcoin (BTC), ethereum (ETH), Gemini dollar (GUSD), GMO JPY (GYEN), GMOUSD (ZUSD), Pax Gold (PAXG), Pax dollar (USDP), and Paypal dollar (PYUSD). Notably, the list has become more streamlined, as it no longer includes cryptocurrencies approved only for custody, listing, or both, as it did previously.
Enhanced Guidance and Framework
The DFS's update also introduced new guidance for coin-listing policies and a general framework for Greenlisted Coins. This framework aims to enhance the original guidelines issued by the department in 2020.
One of the key aspects of this updated guidance is the heightened risk assessment standards for coin-listing policies. These standards are designed to ensure that entities listing cryptocurrencies have robust policies in place to assess and manage risks effectively, particularly when dealing with retail consumers.
Additionally, the DFS now requires licensees to develop and submit a coin-delisting policy for DFS approval, ensuring compliance with the proposed guidance. This step further reinforces the department's commitment to maintaining a transparent and compliant cryptocurrency ecosystem.
Public Feedback and Future Steps
The DFS's announcement also outlined that the proposed guidance for coin-listing and the general framework for Greenlisted Coins is open for public feedback until October 20. This engagement with the public and industry stakeholders demonstrates a commitment to fostering an inclusive regulatory environment and considering the perspectives of various stakeholders in shaping cryptocurrency regulations.
Meanwhile, the cryptocurrency price tracking website CoinStats indicated that the price of DOGE slipped 0.75% over the past 24 hours. Subsequently, DOGE was trading hands at $0.062086 at press time. This was a slight deviation from the positive trend that the meme coin had experienced throughout the past 7 days. Nevertheless, the cryptocurrency’s price was still up 1.45% for the week.
Price chart for DOGE/USDT (Source: CoinStats)
During the past 24 hours, DOGE was able to reach a peak at $0.063158, while its daily low sat at $0.061977. As a result, DOGE was trading closer to its 24-hour low at press time.
Daily chart for DOGE/USDT (Source: TradingView)
From a technical perspective, a symmetrical triangle had formed on DOGE’s daily chart. This suggested that a breakout may be in the cards for the meme coin’s price. If the cryptocurrency breaks down towards the downside, then it may retest the next support level at $0.05835. Conversely, a positive breakout may result in DOGE’s price breaking above the $0.06450 resistance level - flipping the level into support as a result.
Thereafter, continued buy support could elevate the meme coin’s price to the next significant mark at $0.07195 in the following few days. Investors and traders may want to pay close attention to the movement of the 9-day EMA line if DOGE’s price closes a daily candle above $0.06450. Should the 9-day EMA line cross above the 20-day EMA line at this point, then it will signal that short-term momentum has shifted in favor of buyers. Subsequently, the popular meme coin may have the support needed to overcome the aforementioned $0.07195 resistance level - potentially clearing a path for it to rise to $0.08395 in the proceeding few weeks.
Disclaimer: Coinpaper does not recommend that any cryptocurrency should be bought, sold, or held by you. Always conduct your own research and consult your financial advisor before investing in any digital asset.