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On December 4, the same day HAWK memecoin launched, its value plummeted by over 95%. This significant loss prompted individuals and institutions associated with the cryptocurrency to file lawsuits against Hailey Welch, the project’s creator. The investors claim that they suffered damages due to the illegal promotion and sale of the HAWK token without prior registration.
HAWK Experiences Major Collapse
The Burwick Law firm, representing the investors, filed a lawsuit in a U.S. federal court against the founders of HAWK memecoin. The filing alleges that the plaintiffs sustained losses as a result of the token’s unlawful marketing. Victims of this incident pointed out that the token was offered to the public without proper registration, constituting a violation of legal regulations.
Following the launch of HAWK memecoin, its price rapidly decreased, revealing that wallets holding 96% of the token supply had sold off their assets. This situation incited outrage among investors, leading to increased suspicions that the event was a fraudulent scheme.
Hailey Welch Defends Her Project
Hailey Welch defended the HAWK project, stating it is not merely a fundraising effort. In a statement to Fortune magazine on December 4, she explained that her interest in cryptocurrency developed after attending conferences and viewed engagement with her fans as a key motivation. Welch’s manager, Jonnie Forster, emphasized that HAWK memecoin differs significantly from other celebrity-backed projects.
The lawsuit includes several defendants, such as Tuah The Moon Foundation, OverHere Ltd, and its manager Clinton So. Los Angeles-based memecoin marketer Alex Larson Schultz is also among those named in the case.
As the lawsuit progresses, it has been noted that the swift value increase of the HAWK token followed by the subsequent collapse has undermined confidence in the project, leading to substantial losses for investors.
The outcome of these lawsuits remains uncertain. The judge may decide whether to refer the case for jury examination while evaluating summary judgment requests.
This incident with HAWK memecoin highlights the critical importance of trustworthiness in the cryptocurrency market.
