Investors are taking legal action against the Hawk Tuah meme coin project after allegations surfaced of a rug pull that led to significant financial losses. According to reports, the lawsuit emerged following grievances from the investors who claim they were misled.
Launched in early December, the $Hawk token was introduced by Haliey Welch, known as the “Hawk Tuah girl.”Her initiative attracted a global audience, encouraging many fans to invest eagerly in the new cryptocurrency.
However, shortly after its debut, concerns regarding a potential rug pull began circulating on social media, as investors noticed the rapid devaluation of their investments. This prompted notable crypto investigator Coffeezilla to criticize the launch, describing it as “one of the most miserable, horrible launches” he had ever witnessed.
In a detailed analysis, he pointed out the alarming fact that the creators reportedly profited over $1 million in fees while investors faced devastating losses. He also raised concerns about claims of insider trading, directly tying these actions to the creators of the coin.
Investors File Suit Against Hawk Tuah Meme Coin Team
As detailed in a Newsweek report published on December 19, several investors have filed a lawsuit against the individuals associated with the Hawk Tuah project.
The lawsuit primarily focuses on the “unlawful promotion and sale”of the $HAWK token, which the defendants allegedly offered to the public without complying with proper registration protocols.
The companies and individuals named in the suit include Overhere Ltd, the firm behind the coin, as well as executive Clinton So and promoter Alex Larson Schultz. Interestingly, Haliey Welch is not directly implicated in the lawsuit.
Legal representatives state that the project incited a “speculative frenzy” that led to a significant temporary surge in the token’s market value. This rapid escalation created a notable market capitalization soon after launch.
The lawsuit alleges that the defendants capitalized on Welch’s celebrity influence, leveraging her popularity to bolster the token’s reputation and credibility. She was even featured in discussions on her podcasts, which included notable guests, further attracting potential investors.
Many of the investors lured into this venture were newcomers to cryptocurrency, drawn in by Welch’s involvement. The plummeting value of the token ultimately resulted in substantial financial damages to these individuals who had placed their trust in the project and its promises.
This controversy highlights a broader trend in the cryptocurrency space, where numerous projects have faced backlash. A similar situation occurred in December 2022 with Logan Paul’s CryptoZoo project, which also led to significant investor discontent, culminating in the launch of an NFT buyback program to assist those who had incurred losses.
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