‘Hawk Tuah’ star Hailey Welch’s multimillion-dollar memecoin disaster has gone from bad to worse after a damning lawsuit was filed Thursday.
The group behind social media star Hailey Welch’s memecoin, which dramatically collapsed just hours after its launch, is being sued after failing to register the cryptocurrency, according to court records.
The lawsuit, filed by investors, accuses overHere Ltd., its founder Clinton So and social media influencer Alex Larson Schultz, as well as the Tuah The Moon Foundation of illegally promoting and selling cryptocurrencies that were allegedly never recorded properly.
Memecoins, which rely on cultural references and online fandoms to gain traction, are accessible and have a low barrier to creation, investors said, adding that Welch’s “frantic” marketing of the token contributed to its broader appeal.
Welch herself, however, is not named as a defendant in the lawsuit.
The coin, known as ‘$HAWK token’, quickly rose to a market capitalization of $490 million, before eventually falling more than 90 percent to less than $100 million within hours of its launch on the 4th. of December.
‘Hawk Tuah’ star Hailey Welch’s multi-million-dollar memecoin disaster has gone from bad to worse after the dubious group behind the failed cryptocurrency was hit with a damning lawsuit on Thursday.
The coin, known as ‘$HAWK token’, quickly reached a massive market capitalization of $490 million, before ultimately plunging more than 90 percent within hours of its launch on December 4.
Now, the plaintiff’s attorneys allege that a pre-sale of the coin had raised approximately $2.8 million, at a valuation of $16.69 million, before the release date, according to the lawsuit.
The investors are now seeking more than $150,000 in damages.
Thursday’s complaint also alleges that the day after the failed launch, So, who initially launched the coin, converted the Tuah Foundation into an offshore entity and sold 17 percent of the tokens through the organization to a subset of people. to circumvent securities laws.
However, the defendants continued to trade the remaining 83 percent of the tokens, making “no serious attempt” to restrict buyers outside the US.
“The project was clearly intended to take advantage of the US market,” the complaint said.
By linking the success of a social media influencer like Welch, he literally said that token holders would essentially be shareholders,” the investors said.
“Despite these clear indications of its status as a security, the $HAWK token was not registered by the defendants,” they added.
‘We have been extremely transparent about the limited scope of our participation in the Hawk Tuah token project. “We are confident we have done nothing wrong,” an overHere spokesperson said in an email.
The failed memecoin was inspired by the internet celebrity who rose to fame earlier this year after a cheeky comment during a TikTok video that went viral.
Welch has since faced harsh backlash online, as critics accuse the 22-year-old and her team of participating in the “money grab” scheme, which she later denied on X.
“As for any litigation, we will let the process take place in court.”
Welch has since faced harsh backlash online, as critics accuse the 22-year-old and her team of participating in the “money grab” scheme, which she later denied on X.
‘Copy and paste: Hawkanomics: The team did not sell a single token and not 1 KOL received 1 free token. We tried to stop the snipers as best we could with high fees at the start of the launch on @MeteoraAG. Rates have already been reduced,” he published.
“We tried to stop the snipers as best we could by using high fees at the beginning of the launch.”
The failed memecoin was inspired by the internet celebrity who rose to fame earlier this year after a cheeky comment during a TikTok video that went viral.
Since then, she’s made the most of her stardom by launching a custom products company and a hit podcast, ‘Talk Tuah,’ which has featured comedians such as Hannah Berner and Whitney Cummings, pop star JoJo Siwa and entrepreneur Mark Cuban.