Internet Sensation Hailey Welch Sued Over Alleged $HAWK Memecoin Rugpull
From Fame to Fraud? Hailey Welch Faces Lawsuit Over $HAWK Memecoin Collapse and Alleged Pump-and-Dump Scheme
Internet sensation, Hailey Welch, popularly known as the “Hawk Tuah Girl,” is facing serious legal trouble after her $HAWK memecoin ended in an alleged rugpull. Investors have now sued Welch and her team, accusing them of orchestrating a pump-and-dump scheme that caused the token’s value to plummet by 95% within hours of its launch.
The Solana-based $HAWK token debuted on December 4, 2024, quickly amassing a market cap of $490 million. The excitement was however short-lived as a few hours later, the token’s value crashed, wiping out millions of dollars in investments.
Heavy Promotions and Allegations of a Pump and Dump Scheme
On December 19, a group of 12 investors filed a federal lawsuit, claiming collective losses of over $151,000. The lawsuit, filed by Burwick Law, names Welch, the Tuah The Moon Foundation, OverHere Ltd., Clinton So, and Alex Larson Schultz as defendants.
The plaintiffs allege the defendants marketed and sold $HAWK as an unregistered security, violating U.S. securities laws. They also accused Welch of using her fame, podcast, and heavy social media presence to promote the token and attract unsuspecting investors.
They also argued that the massive hype inflated the $HAWK token artificially. Additionally, connected wallets controlling 96% of the coin’s supply were allegedly selling during the crash, further pummeling the value of the token.
Hailey Welch and Partners Response
Following the accusations, Welch quickly defended herself and the project, denying claims that it was a rugpull. During a charged Twitter Spaces session with investors two weeks ago, Welch abruptly left, saying it was time to “go to bed.” She has not returned to social media since.
Other parties involved have also shifted the blame from themselves. On Monday, OverHere Ltd., a partner in the project, issued a statement attempting to shift blame to Alex Larson. The company claimed it made no profit from the token and that the work was contractual. It accused Larson of controlling token decisions, fees, and the treasury.
The token’s value continues to plummet, with the market cap now at a mere $47.7 thousand market cap according to data from CoinMarketCap.
As the situation unfolds, the controversy serves as a warning for other influencers and crypto investors alike. Legal experts believe the case could set a precedent for how celebrity endorsements are scrutinized in the crypto space.
