Hawk Tuah Memecoin Faces Legal Scrutiny After Price Drop
Hawk Tuah Memecoin– The launch of influencer Haliey Welch’s Hawk Tuah (HAWK) memecoin on December 4th sparked outrage across social media platforms after the token briefly surged in value before experiencing a sharp drop. Allegations of insider trading, sniper bots, and questionable wallet activities have created a firestorm of criticism surrounding the coin’s debut.
Hawk Tuah (HAWK) Memecoin Briefly Hits $490 Million Market Cap, Then Crashes
The HAWK memecoin launched at 10:00 pm UTC on December 4 and quickly soared to a peak market cap of $490 million. However, the euphoria was short-lived. Less than three hours after its debut, the token’s value plummeted by 91%, trading at just $41.7 million at the time of publication, according to data from DexScreener.
The sharp drop raised concerns about potential manipulation, as aggregated data from Bubblemaps and DexScreener revealed that a mix of insider wallets and sniping bots controlled a large percentage—between 80% and 90%—of the total HAWK supply shortly after the launch.
Insider Allegations and Claims of Sniping Bots
While the price surge and subsequent crash raised eyebrows, Welch was quick to respond to the accusations. On December 5, she posted to X (formerly Twitter), stating that neither she nor her team had engaged in any insider trading or sold tokens. She also emphasized that no key opinion leaders (KOLs) had received free tokens. Welch further explained that the team had used a decentralized liquidity protocol, Meteora, to reduce the risk of sniping.
We haven’t sold a single token, and not 1 KOL was given 1 free token, Welch wrote. We tried to stop snipers as best we could through high fees at the start of the launch on Meteora.
However, onchain data, available through Solana block explorer Solscanner, contradicted Welch’s claims. A wallet was identified as having sniped 17.5% of the total supply of HAWK tokens within seconds of the launch, purchasing the tokens for 4,195 Wrapped Solana (WSOL)—approximately $993,000 at the time. Over the next 90 minutes, the wallet sold 135.8 million HAWK tokens, pocketing a profit of $1.3 million.
Investor Losses and Legal Concerns Mount
The controversy surrounding the launch doesn’t end with allegations of sniping and insider manipulation. Some investors have claimed significant losses from their participation in the HAWK token. Notably, one investor reportedly swapped around $1.4 million worth of another memecoin, MOODENG, into HAWK—only to lose over $1.3 million in the process, according to onchain data shared by users on X.
With the drama surrounding the launch, many observers are questioning the legality of the token’s deployment. Some have even suggested that Welch and her team could face regulatory scrutiny for potential market manipulation.
SEC Complaints and Legal Action Against Hawk Tuah Memecoin
The controversy has not gone unnoticed by regulators. Several users on X have claimed to have filed complaints with the U.S. Securities and Exchange Commission (SEC) regarding the HAWK token. Additionally, law firms have begun reaching out to potential clients who may have lost money in the memecoin, offering their services for legal action.
On December 5, Burwick Law posted on X, inviting anyone who lost money on the HAWK token to contact their firm for a consultation about their legal rights.
Anyone who lost money on this coin is encouraged to reach out to Burwick Law to learn about their legal options, the firm’s tweet stated.
Will HAWK Memecoin Face Legal Action?
As the situation develops, it remains to be seen whether the HAWK token launch will result in legal ramifications for Welch and her team. Some analysts suggest that the memecoin’s controversial launch could be a precursor to a larger regulatory crackdown on similar projects, especially if further evidence of market manipulation or fraud comes to light.
Investors and participants in the HAWK memecoin are advised to monitor the situation closely, as the legal and regulatory landscape surrounding cryptocurrency projects continues to evolve.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrencies and stocks, particularly in micro-cap companies, are subject to significant volatility and risk. Please conduct thorough research before making any investment decisions.
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