Floki Inu Rises Despite Hong Kong Regulator Warning
Hong Kong’s Securities and Futures Commission issued a warning about Floki Inu staking program today. But that wasn’t enough to stop the token from rising more than 3%.
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Popular memecoin Floki Inu rose almost 4% in the past 24 hours despite regulatory scrutiny from the Hong Kong Securities and Futures Commission. The SFC warned about two investment products - the Floki Staking Program and the TokenFi Staking Program.
According to the statement from the commission, the products don't have authorization to operate in the city-state and could be risky for investors.
Despite the public callout, FLOKI rose from 0.00002815 to $0.00002936 today. It has since dropped to $0.00002917 on CoinMarketCap, but the memecoin is still maintaining its gains in the last 24 hours.
The price increase is likely a result of the general market rally led by Bitcoin. BTC returned to $42k today, rose 6%, and other cryptocurrencies followed immediately. ETH gained 2.4%, AVAX 8%, and SOL went up 7%. Floki Inu dropped 2% compared to BTC in the last 24 hours.
Regulatory Scrutiny
The concerns about Floki Inu's investment products are mostly because of their promising high returns. The Floki Inu and TokenFi staking programs are offering high returns. This has led the SFC to question the legitimacy of the products and raise the possibility of fraudulent activities.
"These investment products ostensibly have some characteristics of collective investment plans or structural products supervised under the Securities and Futures Ordinance… but they are not recognized by the Securities Regulatory Commission," it said.
Hong Kong has become an attractive jurisdiction for crypto projects in recent years due to its welcoming regulatory environment. However, regulators in the country have also tried to prevent the influx of unlicensed digital assets products.
The SFC recently partnered with the Hong Kong Police Force to establish a working group on Virtual Assets Service Providers (VASPs). The essence of this group is mostly to protect investors from fraudulent activities related to digital assets.
Floki Performance and New Initiatives
Despite its positive performance today, Floki Inu has been on a bad run. The memecoin was one of the top performers before but has now dropped out of the top 100 cryptocurrencies by market cap. It has fallen 20% year to date and has a 24-hour trading volume of just $11.77 million.
However, the project has been working on turning things around with several initiatives, including its controversial staking program. The staking program offers APY ranging from 2% to 10% for holders based on the length of their staking. The period could be between 3 months to 4 years.
Besides that, Floki also launched Valhalla. It describes it as a play-to-earn NFT metaverse game powered by the FLOKI token. Players must hold a specific amount of FLOKI for characters to be playable and earn FLOKI from playing the game. The game also comes with NFT and a marketplace and is currently on the testnet.
