Hawk Tuah Coin: The Risks of Investing in Celebrity-Backed Cryptocurrencies

Bitcoin has reached a milestone of $100,000. Driven by Donald Trump's reelection and the potential for a pro-cryptocurrency administration, investors are diving into the digital currency. As Bitcoin’s value climbs, cryptocurrency is making a comeback in the public eye after the setbacks of 2022.

It seems the memecoin craze is making a comeback as well. On the same day Bitcoin reached its new six-figure high, viral sensation Hailey Welch, known as the "Hawk Tuah" girl, launched her own cryptocurrency token, $HAWK.

Upon launch, $HAWK soared to a market cap of $500 million, only to crash within minutes. Its current market cap sits around $36 million. Hawk Tuah fans quickly flooded social media to share stories of losing thousands. It’s beginning to feel a lot like 2021 all over again.

Celebrity crypto is a scam

During the crypto boom of 2021, many celebrities and influencers quickly realized there was money to be made. Musicians, reality TV stars, and e-sports figures endorsed altcoins or even launched their own branded memecoins.

Cryptocurrency, by nature, is a risky investment. Tokens are highly volatile and speculative assets, with little government regulation or oversight in the market. Even Bitcoin, considered the safest bet in the crypto world, has experienced significant fluctuations. If you’re forced to sell during a downturn, you could lose a substantial amount.

Moreover, creating a crypto token is now easier than ever. In recent years, platforms have emerged that simplify the process. Dogecoin, the most popular memecoin, set a success benchmark that no other memecoin has been able to match.

The promise of easy money and quick riches through crypto tokens and memecoins has attracted significant investment from many people. Back in 2021, celebrity and influencer-created memecoins were all the rage. As Mashable reported at the time, many of these turned out to be scams.

Rug pulls are common with memecoins, especially those launched by influencers and celebrities. Here’s how it typically unfolds: A well-known figure introduces a memecoin, encouraging their fans to buy in, both to support the creator and to profit. However, before the token officially launches, the creator sets aside a portion of tokens for themselves or their inner circle. These are often given away freely or sold in a pre-launch sale at a fraction of the anticipated price. When the token hits the public market, demand drives its value up. But as soon as that happens, those who acquired tokens early sell off their holdings for profit, causing the price to crash. Fans who were left holding the bag find their money tied up in a now-worthless token, unable to sell it.

What is Haliey Welch's $HAWK token?

In short, it's just another memecoin on the Solana blockchain. Welch hinted at the launch in late November, discussing the possibility of releasing a memecoin during a podcast interview with businessman Mark Cuban. She also shared a thread on X (formerly Twitter) from a company called overHere, which claimed to be launching the token on her behalf.

"$HAWK isn’t just a meme coin; it’s a cultural movement," reads the token's description on overHere's website. "Haliey is using her meme to bring together her entire community—from TikTok followers and Talk Tuah podcast listeners to merchandise buyers and charity supporters. With $HAWK, hundreds of thousands of non-crypto users will be onboarded because Haliey is making it easy, fun, and engaging. If you love Haliey, you love memes, and $HAWK is where it all comes together."

OverHere's original X thread also emphasized that $HAWK "isn't just another token launch," claiming it would help onboard non-crypto users while prioritizing transparency.

So where did it all go wrong?

What happened with the $HAWK launch?

Soon after the $HAWK launch, Welch's X post received a Community Note warning that 96 percent of the token's supply seemed to be controlled by just 10 connected wallets. While wallets are anonymous to some extent, the risks are clear when such a large portion of a token is held by so few—if these holders begin selling, the token's value could crash.

As shown in the chart above from blockchain data analytics platform Bubblemaps, $HAWK surged to a market cap of nearly $500 million within minutes of its launch, only to drop just as quickly. As of writing, the token has a market cap of $36.6 million. In short, most people who purchased the coin during those early hours have lost money.

What has Haliey Welch said about $HAWK?

In the hours following the launch, Welch and the overHere team tried to manage the fallout, asserting that "Haliey’s team has sold absolutely no tokens" and attempting to shift the blame to snipers—individuals who use bots to quickly purchase tokens at the lowest price. They also released "Hawkanomics," which seems to show that Welch’s share of tokens (10 percent of the total supply) is locked for 12 months.

Eventually, they all joined an X Spaces to discuss the launch, but Welch left after an hour, saying she was "gonna go to bed." The overHere team assured listeners they would "come back tomorrow" and that they weren’t going anywhere. However, for those who bought the token shortly after launch, only to see its value quickly evaporate as others sold off their holdings, that might not offer much reassurance.

Editors opinion

Hawk Tuah, launched with zero taxes, burnt liquidity, and a renounced contract, claims to offer a secure and community-driven growth model​. However, its value has been highly volatile, spiking to significant heights shortly after launch only to see drastic drops shortly thereafter​. This rollercoaster price action is common among meme coins, where initial hype and speculative investment often lead to a quick surge in value followed by rapid corrections.

The coin's market cap, which peaked at almost $500 million after its launch, has since fallen significantly​. Critics argue that the coin's price volatility reflects a classic meme coin scenario: speculative buying and selling with little regard for long-term utility or project fundamentals. This dynamic often leaves early investors, particularly those who bought in during the initial surge, facing significant losses​.

While meme coins like Hawk Tuah are gaining popularity due to their association with viral personalities and trends, they also draw skepticism for their lack of substantive value propositions. These tokens often thrive on social media hype, community-driven efforts, and humor rather than a clear, long-term roadmap or utility​.

In summary, while Hawk Tuah may capture attention through its novelty and viral moments, its long-term viability remains uncertain. Investors should exercise caution, as the volatility and risks associated with meme coins like this are high, and most early adopters have yet to see significant returns.