Hailey Welch, widely recognized for her viral internet fame, has broken her silence regarding allegations of involvement in a crypto “rug pull” linked to the $Hawk meme coin. This comes in the wake of a class-action lawsuit filed on December 19 by investors accusing Welch and others of deceptive practices surrounding the cryptocurrency project.
The $Hawk Collapse and Legal Fallout
The controversy began when the $Hawk cryptocurrency, launched by Welch in early December, suffered a catastrophic collapse. According to Newsweek, the token plummeted by over 95% in value within just 20 minutes on December 4, wiping out $440 million in market value. Investors accused the project of being a “rug pull,” a scheme where token creators dump large quantities of holdings to crash the value, leaving others with significant losses.
The lawsuit names OverHere Ltd, the company behind the token, along with its executives Clinton So and Alex Larson Schultz. It alleges that the $Hawk coin was unlawfully promoted and sold without proper registration. Tuah The Moon Foundation, the entity responsible for handling the proceeds from the token, was also implicated.
Hailey Welch’s role in the project has come under scrutiny, with plaintiffs claiming that her involvement lent a false sense of credibility to the coin, encouraging fans and investors to participate. Welch has been accused of using her celebrity influence to artificially inflate the token’s value.
Hailey Welch’s Response and Denials
On December 20, Welch addressed the allegations in a statement posted on X (formerly Twitter):
“I take this situation extremely seriously and want to address my fans, the investors who have been affected, and the broader community. I am fully cooperating with and am committed to assisting the legal team representing the individuals impacted, as well as to help uncover the truth, hold the responsible parties accountable, and resolve this matter.”
She also included a link for affected investors to contact Burwick Law, one of the firms representing the plaintiffs.
Welch’s spokesperson told Dexerto that she had no direct involvement in the coin’s creation or management and was only paid an initial sponsorship fee. They claimed the creators exploited her viral fame for their benefit.
Community Reaction
Despite Welch’s denials, online critics have been vocal, with many accusing her of complicity. A community note attached to her December 4 promotional tweet suggested she misled investors and profited from the scheme.
Welch, however, plans to move forward, continuing her podcast, Talk Tuah with Hailey Welch, while working to clear her name. A representative of Burwick Law described the situation as part of a broader pattern of memecoin projects leveraging celebrity influence to exploit everyday investors.
As the legal battle unfolds, Welch’s next steps and the investigation into the $Hawk collapse will determine the resolution of this high-profile crypto controversy.