Hawk Tuah Haliey Welch's Crypto Team Nets £2.59M Amid Botched Token Launch, Fans File SEC Complaints

The launch of the HAWK meme coin, spearheaded by social media influencer Haliey Welch, has devolved into controversy as reports reveal that her crypto team profited £2.59 million ($3.3 million) during a chaotic rollout.

The token's value crashed by 95% shortly after launch, sparking investor outrage and leading to complaints filed with the US Securities and Exchange Commission (SEC).

Welch, 22, now faces the possibility of lawsuits for her involvement in what some have labelled a "rug pull" scheme.

Viral Fame to Crypto Infamy

Welch shot to internet fame earlier this year after a TikTok video about relationship advice went viral, amassing her over 2.5 million followers.

Leveraging her newfound popularity, she ventured into crypto, pitching the HAWK token as a community reward for her fan base.

The token, launched on the Solana blockchain, was marketed as an opportunity for fans to participate in giveaways tied to Welch's podcasts and merchandise.

However, the coin's value plummeted shortly after peaking at a £392 million ($500 million) market cap, leaving many fans and investors with significant losses.

Blockchain data from Bubblemaps revealed that nearly 90% of the token supply was manipulated by insiders or snipers who bought large amounts during the launch.

Welch claimed in a post on X (formerly Twitter) that her team had done its best to prevent snipers, but the damage was already done.

Insider Profits and Allegations of Misconduct

According to Bubblemaps CEO Nicolas Vaiman, the HAWK team orchestrated a "one-day pump and dump," pocketing £2.59 million ($3.3 million) in profits.

The data revealed that 17% of the token supply was allocated to 285 early investors, many of whom sold their holdings immediately, destabilising the coin's price.

The launch also saw only 3% of the tokens made available to the public through the Meteora exchange, contradicting Welch's claims that 20% would be distributed to fans as giveaways.

Additionally, the team collected an estimated £1.57 million ($2 million) in fees from the exchange.

Journalist Stephen Findeisen, known as "Coffeezilla," confronted Welch's team during a heated audio event on X Spaces.

He criticised the launch as "one of the most miserable, horrible launches I've ever seen" and accused the team of insider trading.

These allegations were denied by Alexander Larson Shultz, a team member nicknamed "Doc Hollywood," who has ties to Canadian entertainer Howie Mandel.

Legal Risks for Welch

As the controversy deepens, Welch may face legal repercussions. According to Scott Armstrong, a former US Department of Justice prosecutor, Welch could be subject to civil or criminal investigations for misleading her followers. "

The optics are obviously terrible and have the hallmarks of a rug pull," Armstrong said.

Welch's lawyer, Christian Barker, stated that she was paid £98,135 ($125,000) to promote the coin, alongside a 50% share of the net proceeds after expenses.

While Welch claimed ignorance of crypto regulations, such as those that led to legal action against Kim Kardashian for promoting unregistered tokens, many believe she was used as a marketing tool by experienced crypto insiders.

Rising Complaints and SEC Involvement

Disgruntled fans have filed complaints with the SEC, accusing Welch and her team of fraudulent practices.

Meanwhile, blockchain analysis suggests that the token launch involved coordinated efforts to maximise insider profits at the expense of public investors.

The HAWK debacle highlights the risks associated with speculative meme coins. With cryptocurrencies gaining mainstream attention from figures like Donald Trump and Elon Musk, experts warn that scams involving unregulated tokens are likely to increase.

Investors are advised to steer clear of volatile, low-cost tokens promising quick returns. Instead, experts recommend focusing on more established cryptocurrencies like Bitcoin and Ethereum, which offer stability and can be accessed through regulated exchange-traded funds.

Disclaimer: Our digital media content is for informational purposes only and not investment advice. Please conduct your own analysis or seek professional advice before investing. Remember, investments are subject to market risks and past performance doesn't indicate future returns.