In a startling turn of events, Floki Inu (FLOKI), a prominent player in the meme cryptocurrency sector and a competitor of Shiba Inu (SHIB), is grappling with regulatory troubles unleashed by Hong Kong's Securities and Futures Commission. The regulator issued a public warning cautioning against two investment products associated with Floki Inu – the Floki Staking Program and TokenFi Staking Program.
The SFC, in an official note, revealed that these products offer staking services and claim to deliver annualized returns ranging from 30% to over 100%. However, the watchdog emphasized that neither of these products has received authorization for public sale in Hong Kong, and their managers failed to convince the regulatory body about the feasibility of achieving such high returns.
Adding to the scrutiny, the China Securities Regulatory Commission cautioned investors about virtual asset "pledge" arrangements, which may be unauthorized collective investment schemes carrying significant risks. Investors engaging in such schemes may receive limited or no protection under the Securities and Futures Ordinance, putting their entire investment at risk.
"Too good to be true"
The SFC affirmed its commitment to taking appropriate action against any illegal conduct, stressing that the Floki Inu products exhibit characteristics of a collective investment scheme. Violations, especially pertaining to the promotion of interest in collective investment schemes without proper licensing, are subject to legal consequences, reports the regulator.
This unexpected regulatory blow raises questions about the future trajectory of Floki Inu and the broader cryptocurrency market, as authorities intensify efforts to safeguard investors from "too good to be true" investment products.
Alex Dovbnya
Valeria Blokhina
