Hong Kong Regulator Flags Floki Protocol’s Pledged Products as “Suspicious”

The Hong Kong Securities and Futures Commission (SFC) has issued a stern warning to the public about two pledge products, the Floki Stake Program and the TokenFi Stake Program. The financial regulator called the two pledges “suspicious”, as they are both part of the Floki protocol.

Hong Kong SFC Issues Warning on Pledges

In a media release, the SFC mentioned that the Floki pledge program and the TokenFi pledge program claimed to offer “high annualized return targets ranging from 30% to over 100%”. However, the regulator emphasized that these two cryptocurrency products are not yet authorized in Hong Kong.

Pledging is a way for cryptocurrency holders to receive rewards while supporting the operation of the blockchain. When owners send their crypto assets to a pledge pool for a specific period of time, they can earn more cryptocurrency.

The SEC said the Floki agreement failed to satisfactorily demonstrate how its pledge program would achieve its high annualized return goals. As a result, the financial regulator added these products to its Suspicious Investment Product Alert list on Friday, January 26th.

In addition, the SEC issued a stern warning to investors about “pledge” arrangements related to digital assets, as they can pose high risks and lead to unauthorized collective investment schemes. The financial regulator added:

Investors should also be cautious of investment products that claim to offer “incredibly good” returns and be vigilant in making investment decisions.Bitcoin Miner

Ultimately, the SFC reinforced its commitment to ensuring compliance with regulatory standards and protecting the Hong Kong public from fraudulent schemes.

Floki team settles ‘dubious product’ claims

On Saturday, January 27th, the Floki team discussed the SFC’s statement regarding its pledged products in the Weekly Review space on Platform X. The statement implied that there was an ongoing agreement with the Hong Kong regulator. The agreement hinted at ongoing conversations with the Hong Kong regulator on the matter.ETC Miner

While the team didn’t reveal much about the negotiations with the SFC, it did mention working with the marketing agency and starting to promote the pledge product. The agreement claims that it believes it has received approval after the marketing agency secured media space.

Looking ahead, the Floki team noted that it is uncertain whether marketing activities for the Floki Pledge Program and the TokenFi Pledge Program will continue in Hong Kong. However, the agreement promises investors that it will ensure that all necessary terms from the regulator are fulfilled.