Bitcoin just hit $100,000.
Buoyed by the re-election of Donald Trump and the promise of cryptocurrency management, crypto investors are jumping on the digital currency. As the price of Bitcoin climbs higher, the cryptocurrency seems to be moving back into the public consciousness behind crypto. crash of 2022.
Also, it seems that the memecoin fad is starting again right now. On the same day Bitcoin hit its new six-figure high, viral girl “Hawk Tuah” Hailey Welch presented his cryptocurrency token $HAWK.
Who is the ‘Hawk Tuah’ girl, and what does she mean?
Upon launch, the $HAWK surpassed the $500 million market cap. Within minutes, the token crashed. Its current market cap is estimated at $36 million. Hawk Tuah’s fans quickly took to social media to share how they lost thousands of dollars.
Things are starting to look like 2021 again.
Celebrity crypto is a scam
during the the last crypto rush of 2021some celebrities and internet influencers quickly realized that there was money to be made. Some musicians, reality TV stars, and sports names have endorsed altcoins or gone on to create their own branded memecoins.
Cryptocurrency is a risky investment to begin with. Crypto tokens are highly volatile speculative assets. Currently there is very little government oversight or regulation when it comes to the crypto market. Even Bitcoin, seen as the most “safe” bet in the crypto world, has had a lot of volatility and flux. If you have to sell in one of the downturns, you may miss the turning point.
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In addition, now anyone can create a crypto token. Over the past few years, there have been platforms that have helped make the process much easier. Dogecoin, easily the most popular memecoin, sets a level of success that no other memecoin has been able to replicate.
However, the lure of making money easily and getting rich quick with crypto tokens and memecoins has attracted a lot of money from people.
Back in 2021, memecoins created by celebrities and the powerful were all the rage. As Mashable it was reportedmany turned into a scam.
Rugby is very common in memecoins, especially those created by influencers and celebrities.
Here’s what usually happens: A famous or prominent person launches a memecoin. Their fans are encouraged to shop to support their favorite creator while making money for themselves. However, before memecoin is officially launched, the creator of memecoin sets aside a certain amount of tokens for themselves or their friends. They offer this for free or offer an unadvertised launch auction below the price the token will fetch at launch. When the token is sold, the community buys, pushing the value of memecoin higher. But, as soon as that happened, those who got the coins before the launch dumped their holdings for profit, dropping its value and eventually beating memecoin. Fans of celebrities or fans are often left holding the bag, their money tied up in a now useless token that they will never be able to sell.
It may seem obvious that one should not accept financial advice from celebrities. Back in 2018, the Securities and Exchange Commission issued a strong warning about speculative public accounting tactics. “Investors should be skeptical of investment advice posted on social media, and should not make decisions based on what celebrities say,” Enforcement Division Co-Director Steven Peikin said in the same statement announcing Floyd Mayweather Jr. initial capital contributions. “Social media influencers are often paid influencers, not investment professionals, and the securities they promote, whether issued using traditional certificates or on the blockchain, can be fraudulent.”
However, in old age or in parasocial relationships, many fans feel like they can trust their favorite influencers. There is a feeling that they “couldn’t fool me.” But, time and time again, celebrity memecoins have failed, with insiders making money from the influencer’s followers.
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Take the aforementioned and recently introduced $HAWK. In a X Broadcasting of spacesYouTuber Coffeezilla who investigates cryptocurrency scams, confronts Welch and the developers behind his crypto token about how things have played out since launch. Its a legend we have heard before. Most of the tokens were held by several crypto wallets before the public launch. After it was launched, according to Coffeezilla, insiders dumped the token. The value of $HAWK has dropped and all those buyers who entered the launch are left with huge financial losses.
No response from those memecoin buyers. No refunds, no way for them to get their money back. Most memecoins have zero utility, so there is no charge to use the tokens. The only way they get what they put in is if Welch and his team somehow manage to convince another group of suckers to put their money into this worthless brand.
Hopefully, after reading this, you won’t be one of those breastfeeders.