In under 20 minutes, the cryptocurrency memecoin associated with the ‘Hawk Tuah girl’ experienced a dramatic decline, losing nearly $450 million in value.
Supporters lamented that they had lost their entire life savings in less time than it takes to watch an episode of The Simpsons. Haliey Welch and the creators of the ‘$HAWK token’ are accused of orchestrating a ‘rug pull’.
This term describes the action where cryptocurrency creators sell off their holdings, resulting in a price crash, leaving investors with virtually worthless coins.
The value of Welch’s cryptocurrency nosedived from about $490 million to a mere $41 million. Some news reports even suggested that it lost over 95 percent of its value within just one day of its launch on December 4.
Now, the investors who faced financial losses have sought legal representation to pursue Welch and her team.
A court document filed yesterday (December 19) states that the lawsuit ‘arises from the unlawful promotion and sale of the Hawk Tuah cryptocurrency memecoin, known as the “$HAWK” token (the “Token” or “$HAWK”), which Defendants offered and sold to the public without proper registration’.
The lawsuit names Tuah The Moon Foundation, which managed the memecoin’s finances, OverHere Ltd, the company that created the coin, and Clinton So, an executive at OverHere, along with the coin’s promoter Alex Larson Schultz.
However, Welch herself is not named in the complaint, which claims that the defendants leveraged her social media influence to market the coin by promoting ‘community engagement, inclusivity, and bridging mainstream culture with the cryptocurrency world’.
Reddit users remain skeptical and suspect that Welch might still be implicated in the legal proceedings.
One user commented on the platform: “She’s gonna be the scapegoat for the others involved.”
“She tried to make easy money without knowing or caring how it worked. She knew they were using her name/popularity to promote, so that’s all on her,” another stated.
“Not saying the others involved shouldn’t get sued too, but she’s not an innocent scapegoat.”
Someone else added: “Of course she was trying to make money. But at the same time, she could’ve been lied to about how things will work.”
“Even all of us here know s*** about f***, so imagine how clueless the average person is on crypto. Not saying she’s innocent about the scam part, but it’s possible.”