In the volatile world of cryptocurrency, new tokens emerge regularly, each promising to revolutionize the market. However, not all are destined for success. Hawk Tuah, a memecoin birthed by viral influencer Haliey Welch, initially captivated investors but quickly became a cautionary tale. Within mere hours of its launch, the token’s value plummeted by an astonishing 91%, resulting in significant losses for many investors. This rapid decline has sparked a debate over potential insider trading and market manipulation, casting a shadow over Welch’s reputation.
Quick Rise & Sudden Fall of HAWK Token
When Hawk Tuah (HAWK) made its grand entrance on December 4, its market cap soared to an impressive $490 million. This surge was largely fueled by the social media clout of Haliey Welch, known for her viral catchphrase and successful ventures, including a merchandise line and a podcast featuring prominent figures like Mark Cuban. Welch assured her followers that HAWK was “not just a cash grab” and aspired to transform public perceptions of cryptocurrency. Her team committed to not pressuring anyone into purchasing the token and planned to distribute free tokens to fans and customers. Welch herself pledged to retain 10% of the tokens without selling them for a year.
However, the optimism was short-lived. Within hours, HAWK’s value plummeted dramatically, reducing its market cap to a mere $48 million. The token’s price nosedived to just $0.004826, leaving a trail of disillusioned investors in its wake.
Allegations of Insider Trading & Sniping
The abrupt decline in HAWK’s value has been attributed to allegations of insider trading and sniping. Sniping refers to the practice where certain entities purchase large quantities of a token’s supply immediately upon launch. Data from DexScreener and Bubblemaps indicated that insider wallets and snipers controlled up to 91% of HAWK’s supply at its launch. This raised suspicions of potential market manipulation, with many users pointing fingers at Welch’s team.
In response to these allegations, Welch and her team have vehemently denied any wrongdoing. In a recent statement on social media, Welch clarified that neither she nor any key opinion leaders (KOLs) received free tokens. Her team asserted that they attempted to mitigate sniping risks by imposing high fees on the Meteora platform at the token’s launch.
Major Loss for Investors
Despite these precautions, data from SOLScanner revealed a significant transaction where one wallet acquired 17.5% of HAWK’s supply within seconds of its launch. This involved the use of 4,195 Wrapped Solana (WSOL), equivalent to nearly $1 million. The wallet then sold the tokens for a $1.3 million profit within an hour, intensifying the controversy surrounding the launch.
Many investors who joined the HAWK bandwagon at high prices have experienced substantial financial losses. Some even exchanged other cryptocurrencies for HAWK, only to see their investments dwindle. In light of these events, several users have lodged complaints with the Securities and Exchange Commission (SEC), alleging potential violations of securities regulations. Legal experts are now offering assistance to affected investors, suggesting that Welch and her team might face legal ramifications.
