The Hawk Tuah Memecoin Debacle: Here’s What Went Wrong
After initially surging in the minutes following its launch, the Hawk Tuah memecoin imploded in spectacular fashion, losing over 90% of its value in just 20 minutes.
Haliey Welch, famously known as the “Hawk Tuah Girl” from her viral meme, entered the cryptocurrency arena on December 4, 2024, the same day that Bitcoin (BTCUSD) broke through the $100k barrier, launching her Hawk Tuah (HAWK) memecoin. Within minutes, the Hawk Tuah coin, which was launched on the Solana (SOLUSD) blockchain, soared to a $500 million market capitalization. However, the euphoria was short-lived as the token’s value plummeted by over 90% in under half an hour, leaving countless investors reeling.
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Record-Breaking Rise and Fall
Hawkcoin’s launch was a spectacle, with the token’s price surging from its starting value of $0.000007099 to a peak of $0.00004028. This meteoric rise attracted over 16,000 holders but also sowed the seeds of its demise. Just 20 minutes after hitting its peak, Hawkcoin’s market cap nosedived to $60 million and has since struggled, now hovering around $37 million.
The rapid collapse raised eyebrows across the cryptocurrency community. Blockchain analysis by Bubblemaps revealed that a staggering 96% of the token’s supply was concentrated in a handful of wallets at launch, sparking allegations of insider trading and centralized control.
Insiders and Snipers: A Perfect Storm
On-chain data exposed suspicious activity involving both insiders and automated “sniping” bots. One wallet, for instance, purchased 17.5% of Hawkcoin’s supply within seconds of launch for $993,000 and then dumped these holdings for a profit of $1.3 million in less than two hours. This massive sell-off destabilized the token’s value, leaving ordinary investors to bear the brunt.
Stephen “Coffeezilla” Findeisen, a well-known crypto investigator, confronted Welch during a live stream, stating:
“This is one of the most miserable, horrible launches I’ve ever seen. I’ve been tracing it on the chain for a while. You guys generated over a million dollars in fees, while your fans got rug pulled. There were snipers, but there was also insider trading directly linked to y’all’s creator accounts.”
Adding fuel to the fire, 17% of the token supply was pre-sold to insiders without any lock-up period, enabling them to cash out immediately. Critics argue this “strategic allocation” created an uneven playing field, exacerbating the crash.
Source: voidzilla YouTube
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Welch’s Defense and Public Outcry
Faced with mounting accusations, Welch has denied any wrongdoing. In a post on X, she asserted:
Copy and pasting:
Hawkanomics:
Team hasn’t sold one token and not 1 KOL was given 1 free token
We tried to stop snipers as best we could through high fee’s in the start of launch on @MeteoraAG
Fee’s have now been dropped pic.twitter.com/E7xN9VmCrx
— Haliey Welch (@HalieyWelchX) December 4, 2024
Despite these claims, blockchain data suggests otherwise, as significant fees collected during the launch—totaling $2 million—were funneled to the creator’s wallet, reportedly controlled by a Cayman Islands-based foundation.
Welch also faced criticism for her choice of launchpad. Unlike platforms designed to mitigate risks like token centralization, Hawkcoin was launched via overHere, a web3 launchpad with less robust safeguards.
Investor backlash has been fierce. “I really lost $43k apeing in ‘Hawk Tuah’ coin,” lamented one investor on social media. Another claimed to have swapped $1.4 million worth of another token into Hawkcoin, only to lose nearly all of it.
i really lost $43k apeing in “hawk tuah” coin pic.twitter.com/9j4frI37p8
— lynk (@lynk0x) December 5, 2024
Legal and Regulatory Storm Brewing
The fallout has drawn the attention of both law firms and regulators. Burwick Law, for instance, has invited affected investors to explore legal options. Meanwhile, the US Securities and Exchange Commission (SEC) could potentially investigate, given its history of pursuing celebrity-backed crypto ventures.
If you lost money on $HAWK, contact our firm to learn about your legal rights.
Our firm represents thousands of nft and token investors in securities matters.
This is attorney advertising.
— Burwick Law (@BurwickLaw) December 5, 2024
Coffeezilla summarized the sentiment of many, saying:
“They sold 17% of tokens to insiders who had no lock-up period, while only releasing 3% to the public for trading.”
A Sobering Lesson for Crypto Enthusiasts
The Hawkcoin debacle underscores the risks inherent in celebrity-backed cryptocurrencies and memecoins. Welch’s viral fame brought unprecedented attention to her token, but it also highlighted the perils of speculative investments.
The Hawk Tuah debacle serves as a stark reminder of the importance of transparency and ethical practices in the crypto space. For investors, it’s a cautionary tale to approach such ventures with skepticism, regardless of their celebrity endorsements. Whether Welch can rebuild trust or if Hawkcoin becomes another footnote in memecoin history remains to be seen.
As the dust settles, one question lingers: Will the lessons from Hawkcoin’s catastrophic launch lead to meaningful changes in the cryptocurrency world, or will history continue to repeat itself?
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Disclaimer: Wealthy VC does not hold a position in any of the stocks, ETFs or cryptocurrencies mentioned in this article.
