Hong Kong SFC warns about Floki Inu staking program

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The Hong Kong Securities and Futures Commission has scrutinized the Floki Inu staking plan due to its high returns and lack of transparency.

FLOKI plans promise annual returns of 30% to 100% or more.

Hong Kong’s Securities and Futures Commission (SFC) has issued a warning to the public about suspicious investment products called “Floki Stake Program” and “TokenFi Stake Program.”

These programs, which include cryptocurrency staking services, claim to offer very high annualized return targets ranging from 30% to over 100%. However, the SFC highlighted serious concerns about the legality of these programs, citing unrealistic return promises and lack of approval in Hong Kong.

Hong Kong’s main financial regulator, the SFC, has raised a red flag over Floki Inu and TokenFi staking programs that have been luring investors with promises of high returns.

The lack of approval for these programs in Hong Kong adds to regulators’ concerns. The SFC has expressed doubts about the strategies used by these staking programs to achieve such substantial returns and highlighted the lack of transparency as a cause for concern about the viability and longevity of these schemes.

In the highly volatile area of ​​virtual assets, the SFC’s advisory urges investors to conduct thorough research and exercise caution when considering high-yield investment opportunities. Cryptocurrency staking, an increasingly popular way to earn rewards, has come under scrutiny by the SFC.

The Commission warns that such schemes could constitute unauthorized collective investment schemes and pose significant risks. Under the Securities and Futures Ordinance (SFO), investors who participate in these schemes have limited or no protection and face the risk of losing their entire investment.

The SFC notes that information about these suspect products and the products themselves are accessible to the Hong Kong public via the Internet. Accordingly, the SFC registered the two products and related information on the SFC’s Suspicious Investment Product Warning List as of January 26, 2024.

The Commission emphasized its commitment to take appropriate action if legal violations occur.

This announcement serves as a timely reminder that investors should approach cryptocurrencies and investments with skepticism and due diligence.

In response to the evolving challenges of virtual asset trading, the SFC has partnered with the Hong Kong Police Force (HKPF) to establish a dedicated working group focused on virtual asset trading platforms (VATPs).

This joint effort aims to strengthen vigilance and enforcement in the sector, ultimately protecting investors from fraudulent activities and other financial risks.

Recently, the Hong Kong SFC issued another warning about possible fraudulent activities involving BitCuped and the Hong Kong Digital Institute. This highlights regulators’ ongoing efforts to protect investors and maintain integrity within the cryptocurrency environment.