FLOKI

TokenFi

<p>Hong Kong’s financial watchdog, the Securities and Futures Commission (SFC), has issued a stern warning against two crypto investment schemes, namely the “Floki” and “TokenFi” staking programs.</p><h2 id="header-0">Offering high annual returns</h2><p>These programs, luring investors with enticing promises of annual returns ranging from 30% to over 100%, have triggered concerns within the regulatory authority due to their lack of authorization and questionable nature.</p><p>In an <a href="https://apps.sfc.hk/edistributionWeb/gateway/EN/news-and-announcements/news/doc?refNo&#61;24PR12" rel="noopener noreferrer nofollow">update</a> issued on Friday, the SFC emphasized that both Floki and TokenFi’s staking offerings have not been granted approval for public offerings. Furthermore, the administrators of these programs have failed to provide convincing explanations about the feasibility of achieving such unusually high returns. The SFC cautioned that engaging in staking arrangements involving virtual assets without proper authorization may constitute unauthorized collective investment schemes.</p><h2 id="header-1">Unsustainable yield</h2><p>The watchdog expressed its worry about the legitimacy of these staking programs, highlighting that neither has received the necessary authorization to provide services to the public in Hong Kong. Investors participating in these programs would not be protected under the SFC’s regulations, potentially exposing them to significant financial losses.</p><p>With the failure of many crypto platforms in 2022, a number of industry commentators began to question the sustainability of some public offerings. One such commentator, Allen Farrington, General Partner at bitcoin-native venture capital firm Axiom, repeatedly asked, “Where does the yield come from?”</p><p>That appears to be the SFC’s concern in this instance. In its statement, it reaffirmed its commitment to upholding regulatory standards and safeguarding investors from fraudulent schemes. It warned that any breach of the law, including the promotion of unlicensed collective investment schemes, will result in appropriate legal action.</p><h2 id="header-2">Elon Musk-inspired meme coin</h2><p>Floki, initially conceived as a meme-coin inspired by Dogecoin, a project associated with Elon Musk, has evolved into a comprehensive Web3 project spanning decentralized finance, NFTs and the metaverse. TokenFi is a crypto and asset tokenization platform under the Floki umbrella, which aims to capitalize on the booming trillion-dollar tokenization industry. TokenFi, denoted by the ticker TOKEN, seeks to simplify the crypto and asset tokenization process with aspirations of becoming a leading platform globally. Launched last October, TokenFi operates as a multichain tokenization platform on both Ethereum and Binance Smart Chain.</p><p>While both Floki and TokenFi offer distinct staking programs, they share a close integration. Stakers under the Floki scheme gain access to a significant portion of TokenFi’s supply, while TokenFi stakers earn TOKEN rewards through a user-friendly interface.</p><p>In the broader context of crypto staking, the practice allows users to earn rewards by contributing to a blockchain’s security through the proof-of-stake mechanism. By staking cryptocurrency, users participate in a staking pool, similar to depositing money into a savings account. Staking rewards typically range from 5–20%, attracting investors seeking profitable opportunities. However, caution is advised against schemes promising unrealistic returns.</p><p>The SFC, in collaboration with the Hong Kong Police Force, established a dedicated <a href="https://coinnesslive.page.link/yxyb4Bk8fRTSAJFx5" rel="noopener noreferrer nofollow">working group</a> last year to enhance vigilance and enforcement in the evolving crypto sector.</p><p><a href="https://medium.com/&#64;coinness.gl?source&#61;post_page-----981fdf40056a--------------------------------" rel="noopener noreferrer nofollow"> </a></p>

Hong Kong raises red flag on ‘Floki’ and ‘TokenFi’ staking programs

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