Floki Responds to Hong Kong SFC Warning on Staking Programs

Following a cautionary notice issued by the Hong Kong Securities and Futures Commission (SFC) regarding Floki and TokenFi staking programs, the Floki team has responded with a comprehensive statement. 

This move comes as the regulatory body expressed concerns about the purportedly high Annual Percentage Yield (APY) offered by these staking initiatives. 

The Floki team addressed these concerns by explaining how their high-yield programs are sustainable and how they align with regulatory requirements.

Hong Kong users will no longer be able to access staking programs after the SFC's warning on Friday. Floki has implemented visible warnings on both the Floki and TokenFi staking sites, advising Hong Kong users that they are not eligible to stake.

Acknowledging the concerns raised by the SFC, Floki has temporarily suspended its offline marketing campaign in the city. 

‍

Dissecting the SFC's Warning

The Securities and Futures Commission earlier raised alarms regarding the Floki Staking Program and TokenFi Staking Program, both of which tout annual returns ranging from 30% to over 100%. The SFC emphasized that these products have not been authorized for offering to the Hong Kong public.

As a response, the Floki team expressed their disagreement if the APY-driven selection was solely motivated by social media and market forces.

Floki explains the intricacies of their staking programs to provide clarity. The programs, they assert, offer high returns due to a distinctive funding approach. 

Unlike traditional models relying on venture capital or presales, Floki's staking program reportedly rewards participants with $TOKEN, the utility token of the TokenFi platform, without resorting to minting new supplies.

This strategy ensures that a large portion of TokenFi's supply will go to users who stake Floki, in line with the project's ethos. The volatility in rewards, denominated in $TOKEN, is subject to market forces, allowing for fluctuations in APY based on TokenFi’s market capitalization.

Floki aims to maintain the decentralization of their staking programs, assuring users that they retain complete control over their tokens, irrespective of the team’s involvement.