Floki has formally responded to the Hong Kong SFC's recent warning, reiterating their commitment to compliance across jurisdictions and explaining the rationale behind their staking program's high returns.
Cryptocurrency Project Floki Counters Hong Kong SFC's Warning
In a detailed blog post dated Jan. 29, Floki, the team behind the dog-themed memecoin, addressed the recent warning from the Hong Kong Securities and Futures Commission (SFC) regarding its staking programs. The SFC had earlier labeled Floki and Tokenfi Staking Programs as "suspicious investment products," cautioning users against their high promised returns.
Floki's response was a blend of regret and clarification, emphasizing their commitment to legal compliance across jurisdictions. The team outlined the steps taken to align with regulatory expectations, particularly in Hong Kong. These measures included warning notices on their websites, barring Hong Kong users from the staking program. The team also noted that they had already halted their offline marketing campaign in the region planned for mid-December 2023.
The SFC's main concern revolved around the annual percentage yield (APY) of the staking programs, which ranged from 30% to over 100%. Floki's response pointed to the uniqueness of their staking program, where rewards are given in TOKEN, the utility token of their sister project Tokenfi. They attributed the high APY to their decision to eschew traditional fundraising methods, opting instead to allocate a significant portion of Tokenfi's token supply directly to stakers.
Floki further explained that the volatility of rewards, denominated in TOKEN, is subject to market dynamics. The team also explained that the decentralized nature of their staking programs ensured operational continuity and user control regardless of the team's presence.
On the regulatory front, Floki reiterated its respect for regulatory bodies, saying, "We have huge respect for any and all regulators and will continue to engage with them to address any regulatory concerns they may have." The team, however, expressed disagreement if the sole basis for the SFC's warning was the high APY, influenced by market forces.
If, as it appears, a decision to single out the staking programs was made solely because of the high APY of our staking programs stated in social media posts and as moved by market forces, as explained above, then we will have to respectfully disagree.
Do you think Floki's response sufficiently addressed SFC's concerns? Share your thoughts and opinions about this subject in the comments section below.
Source: Bitcoin.com
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