The group promised its backers that it would use all available avenues to comply with the regulations set forth by the Hong Kong authorities. The “Floki Staking Programme” and the “TokenFi Staking Programme,” two potentially hazardous investment products, have drawn the attention of the Hong Kong Securities and Futures Commission (SFC). Both products are associated with the procedure known as Floki.
These products, according to the SFC, promise annualised returns of over 100% and provide staking services. The watchdog noted that none of these goods has been given the go-ahead to be sold in Hong Kong to the general public.
Through staking, users can increase the security of the blockchain and receive incentives. Like putting money into a savings account, people who stake cryptocurrencies contribute to a staking pool. The blockchain’s security and decentralisation are guaranteed by the proof-of-stake mechanism, which validates transactions. The regulatory body stressed that neither of these two products’ governing bodies had provided the Hong Kong SFC with a credible explanation of how they planned to meet their declared high annualised return targets.
The progress of the Hong Kong SFC was discussed by the Floki crew in their weekly review live spaces on the X social media platform. The cryptocurrency platform made it clear that the staking programmes’ excessive performance is the sole grievance raised by the SFC.
Although Floki was unable to disclose details on the talks it had with the SFC, it did clarify that it worked with a marketing firm to launch the advertisements for the TokenFi Staking Programme and the Floki Staking Programme. The agency got media coverage, and the Floki crew thought they had the go-ahead. The Floki team, however, stated that they were unable to comment on whether the marketing effort would continue in Hong Kong for the time being. The group gave its investors the assurance that it would use all available means to comply with the regulations set forth by the Hong Kong government.
The SFC emphasises that the public in Hong Kong can access information on these two products online. As a result, on January 26, 2024, the SFC added both goods and the pertinent information about them on its Suspicious Investment products alert list. Investors are advised by the SFC to exercise caution when engaging in transactions involving virtual assets, since they may be illegal collective investment schemes. Due to the considerable risk involved in these arrangements and the possible lack of protection provided by the Securities and Futures Ordinance (SFO), investors may lose all of their money.
The SFC has also underlined how dedicated it is to upholding legal requirements and shielding investors from dishonest schemes. It stated that necessary legal action will be taken in response to any legal violations, including the marketing of unauthorised collective investment schemes.