Hailey Welch, known as the "Hawk Tuah Girl," has vanished from public life for two weeks, raising significant concerns about her memecoin project, Hawk Tuah (HAWK). This sudden disappearance follows the memecoin's sharp decline in value, with investors now pursuing legal action alleging fraud.
Following the Hawk Tuah token's devastating drop, investors have moved quickly to file a lawsuit against Welch and associated parties. The legal complaint names Welch, the Tuah The Moon Foundation, OverHere Ltd., its executive Clinton So, and promoter Alex Larson Schultz, accusing them of conducting a deceptive "rug pull."
Court documents, as reported by Newsweek, detail how the alleged "unlawful promotion and sale" of Hawk Tuah led to considerable financial losses. Novice cryptocurrency investors were particularly affected. Many were drawn to the project by Welch’s high-profile endorsements and her pivotal influence on its development roadmap. "The token's rapid collapse inflicted significant harm on investors relying on Welch’s involvement and the project’s outlined roadmap," the lawsuit articulates.
Initially, Hawk Tuah garnered significant attention among emerging community-driven memecoins. This was spurred by Welch’s robust promotion across social media and her podcast. Yet, allegations of mismanagement and deceit emerged as the token's value plummeted overnight, wiping out millions in investor funds.
On-chain analyst Coffeezilla has accused Welch and her team of fraudulent activities surrounding the token's launch. Welch had previously announced a partnership with Web3 platform OverHere, touting the Hawk Tuah memecoin as a revolutionary addition to the crypto space.
Despite a meteoric market cap rise to $500 million on its December 4 launch, the token quickly lost 88% of its value. Major holders sold off assets en masse, prompting suspicions of insider trading and a coordinated rug pull by the creators. Many investors affected were Welch’s supporters and newcomers to cryptocurrency.
Facing backlash, Welch revealed details about the token’s economics—coined "Hawkanomics." Only 2% of the total supply was available for public purchase. At the same time, 17% was allocated for a "strategic allocation," reportedly channeled to insider accounts upon full vesting at launch.
During an X Space conversation, Coffeezilla challenged Hawk Tuah’s team on over $1 million collected in fees and scrutinized their response to the crisis. He posited that the rapid sell-off was linked not just to market ambushes but potentially to insider trading among the creators. Critiquing the token's release, Coffeezilla labeled it as poorly managed, urging accountability for the presale funds, which totaled around $16.69 million.