Floki Team Pushes Back on Hong Kong Regulator Warning

Published: Jan 30, 2024
Written By:
Vignesh Karunanidhi
Milk Road Writer

The developers behind meme-inspired cryptocurrency Floki Inu responded to Hong Kong regulators listing its staking program as a “suspicious” investment product, predominantly over advertised yield levels.

In a Medium post, the team highlighted steps taken while disagreeing with the “extreme measure” by the Securities and Futures Commission (SFC).

Actions taken so far include:

  • Blocking Hong Kong users from earning stake rewards
  • Pausing marketing campaigns in Hong Kong.
  • Asserting yields derives organically from the rewards ecosystem.

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Floki team says its yields stem from a unique incentive structure

Floki contends its staking annual percentage yields (APYs) stem from a unique incentive structure, not inherent manipulation.

It claims that distributing the majority of rewards from sister token project TokenFi to community members staking Floki Inu sustains exceptionally high interest without inflation.

By avoiding venture capital raises, founders say robust yields come from market exposure rather than pre-programmed, unsustainable inflation.

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The developers also underscored the decentralized nature of Floki Inu’s staking protocols themselves. They stressed that even if original creators abandoned projects:

  • Staking smart contracts would continue to function independently.
  • Admins cannot alter reward amounts or user deposits.
  • All stakers face the same locked durations and withdrawal fees.

Floki ended by saying that the team respected regulators but strongly disagreed with the idea that advertised APYs alone are reason enough to classify something as very suspicious, given the many levels of transparency and decentralization.

“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, Floki mentioned in the post.

Vignesh Karunanidhi

Vignesh has been a seasoned professional in the crypto space since 2017. He has been writing for over 6 years and specializes in writing and editing various types of crypto content, including news articles, long-form pieces, and blog posts, all focused on sharing the beauty of blockchain and crypto.

Vignesh Karunanidhi
Milk Road Writer
Vignesh has been a seasoned professional in the crypto space since 2017. He has been writing for over 6 years and specializes in writing and editing various types of crypto content, including news articles, long-form pieces, and blog posts, all focused on sharing the beauty of blockchain and crypto.