The Hong Kong Securities and Futures Commission (SFC) has issued a warning statement warning the public to be wary of high-yield crypto investment schemes such as the Floki Staking Program and the TokenFi Staking Program.
SFC warns investors
In a recent announcement, the Hong Kong Securities and Futures Commission (SFC) has revealed that both the “Floki Staking Program'' and the “TokenFi Staking Program'' lack authorization to offer to the public in Hong Kong. .
Regulators warn investors should consider these potentially questionable schemes as both services include crypto staking services that they claim deliver extremely high annualized returns ranging from 30% to over 100%. It states that you need to exercise caution and diligence.
Additionally, the managers overseeing these products were unable to satisfy SFC as to the likelihood of achieving high annual revenue targets.
Highlighting that Hong Kong citizens can access information about these products through the Internet, the SFC has taken proactive steps. On January 26, the Commission added both products and their related details to the SFC's Suspicious Investment Products Alert List.
The SFC has expressed concern and warned investors about “staking” arrangements related to virtual assets, noting their inherent high risk and potential for classification as fraudulent collective investment schemes.
Regulators say these investment products involve a high degree of risk and investors may have limited or no protection under the Securities and Futures Ordinance (SFO) and be exposed to the risk of losing their entire investment. ing.
The SFC advised investors to exercise caution when making investment decisions, especially when they come across investment products that promise returns that seem “too good to be true.”
It will be recalled that in a statement issued on 13 December 2022, the SFC reiterated its warning to investors about the risks associated with virtual asset investment schemes, with a particular focus on “staking” services.
The SFC emphasizes that such arrangements could potentially be classified as collective investment schemes (CIS) and draws this attention to both investors and individuals participating in these virtual asset arrangements. did.
In line with its commitment to regulatory oversight, the SFC asserted that it is prepared to take appropriate action if violations of the law occur.
Floki answers
In a recap of the live space on X (formerly Twitter), the Floki team reacted to developments involving SFC. The cryptocurrency platform emphasized that the SFC's main concerns revolve around the outstanding performance of its staking program.
Although details regarding the discussions with SFC could not be disclosed, Floki did reveal that it has begun promoting the Floki staking program and TokenFi staking program in partnership with a marketing agency. The agency secured media exposure and the Floki team thought they had approval.
For the time being, the Floki team declined to comment on the continuation of the marketing campaign in Hong Kong. They reassured investors of their commitment to navigating all appropriate channels to meet the requirements set by the Hong Kong authorities.
Additionally, the SFC reiterated its commitment to enforcing regulatory standards and protecting investors from fraudulent schemes.
Hong Kong parliament supports spot adoption of Bitcoin ETF
In related news, Hong Kong lawmaker Johnny Ng called on the government to quickly introduce a spot Bitcoin (BTC) exchange-traded fund (ETF).
The decision follows the recent approval of a similar product in the United States.
Hong Kong's first spot crypto ETF, expected to debut by mid-2024, is undergoing review by the SFC and the Financial Supervisory Authority.
The move is seen as an important step forward in keeping pace with global financial trends and cementing Hong Kong's position in the crypto industry. As noted by industry insiders and experts, the rapid introduction of spot Bitcoin ETFs in Hong Kong could also have a significant impact on the region.
The introduction of ETFs is seen as crucial in aligning regulatory and industry expectations regarding governance and compliance, a reality in Asian markets as Hong Kong aims to become a testing ground for the wider region. pave the way to
