Bitzlato temporarily suspends withdrawal amid ongoing legal battle

Hong Kong's financial watchdog, the Securities and Futures Commission (SFC), has issued a stern warning against two crypto investment schemes, namely the "Floki” and “TokenFi” staking programs. Offering high annual returnsThese programs, luring investors with enticing promises of annual returns ranging from 30% to over 100%, have triggered concerns within the regulatory authority due to their lack of authorization and questionable nature. In an update issued on Friday, the SFC emphasized that both Floki and TokenFi's staking offerings have not been granted approval for public offerings. Furthermore, the administrators of these programs have failed to provide convincing explanations about the feasibility of achieving such unusually high returns. The SFC cautioned that engaging in staking arrangements involving virtual assets without proper authorization may constitute unauthorized collective investment schemes.Photo by Sigmund on UnsplashUnsustainable yieldThe watchdog expressed its worry about the legitimacy of these staking programs, highlighting that neither has received the necessary authorization to provide services to the public in Hong Kong. Investors participating in these programs would not be protected under the SFC's regulations, potentially exposing them to significant financial losses. With the failure of many crypto platforms in 2022, a number of industry commentators began to question the sustainability of some public offerings. One such commentator, Allen Farrington, General Partner at bitcoin-native venture capital firm Axiom, repeatedly asked, “Where does the yield come from?” That appears to be the SFC’s concern in this instance. In its statement, it reaffirmed its commitment to upholding regulatory standards and safeguarding investors from fraudulent schemes. It warned that any breach of the law, including the promotion of unlicensed collective investment schemes, will result in appropriate legal action. Elon Musk-inspired meme coinFloki, initially conceived as a meme-coin inspired by Dogecoin, a project associated with Elon Musk, has evolved into a comprehensive Web3 project spanning decentralized finance, NFTs and the metaverse. TokenFi is a crypto and asset tokenization platform under the Floki umbrella, which aims to capitalize on the booming trillion-dollar tokenization industry. TokenFi, denoted by the ticker TOKEN, seeks to simplify the crypto and asset tokenization process with aspirations of becoming a leading platform globally. Launched last October, TokenFi operates as a multichain tokenization platform on both Ethereum and Binance Smart Chain. While both Floki and TokenFi offer distinct staking programs, they share a close integration. Stakers under the Floki scheme gain access to a significant portion of TokenFi's supply, while TokenFi stakers earn TOKEN rewards through a user-friendly interface. In the broader context of crypto staking, the practice allows users to earn rewards by contributing to a blockchain's security through the proof-of-stake mechanism. By staking cryptocurrency, users participate in a staking pool, similar to depositing money into a savings account. Staking rewards typically range from 5-20%, attracting investors seeking profitable opportunities. However, caution is advised against schemes promising unrealistic returns. The SFC, in collaboration with the Hong Kong Police Force, established a dedicated working group last year to enhance vigilance and enforcement in the evolving crypto sector. 

Singapore’s FOMO Pay Forges Collaboration With NotabeneFOMO Pay, a regulated digital payment and banking solutions provider operating under Singapore’s regulatory umbrella, has joined forces with Notabene, a platform tailored for crypto-industry decision-making.Photo by Towfiqu barbhuiya on UnsplashPre-transaction decision makingThe strategic alliance was announced via a blog post published to FOMO Pay’s website on Thursday. Through that communication, FOMO Pay revealed that this collaboration with Notabene will be a key contributor towards the firm’s efforts to elevate its know-your-transaction (KYT) capabilities, ensuring access to accurate and verified business information.A focal point of this partnership lies in amplifying FOMO Pay’s compliance measures, bolstering customer security, and cultivating a foundation of trust in the domains of digital payments and digital assets.Wee Teck Lim, the Head of Compliance at FOMO Pay, emphasized that this partnership mirrors the company’s efforts towards full compliance with global regulations, enhancing anti-money laundering (AML) strategies and decision-making.Responding to regulatory pressureWith a regulatory spotlight on crypto and crypto-related businesses over the past year, market participants are making greater efforts to adhere to national and global compliance rules and guidelines. This move by FOMO Pay not only aids it in adhering to rigorous guidelines but also reinforces the battle against money laundering, terrorism financing, and other such concerns.Pelle Braendgaard, CEO of Notabene, articulated the symbiotic significance of this partnership. He noted that this collaboration stands as a tangible testament to the efficacy of the travel rule implementation, effectively fostering secure and streamlined digital asset transactions. This alignment of missions between FOMO Pay and Notabene, Braendgaard maintains, resonates with their shared aspiration to establish a digital asset ecosystem that is safer and more accessible.FOMO CryptoFOMO Pay, which has been licensed as a payment institution by the Monetary Authority of Singapore (MAS), boasts an array of products including FOMO Payment, FOMO iBank, and FOMO Crypto. Through FOMO Crypto, the firm is actively constructing Asia’s inaugural licensed gateway, which will offer a seamless connection between fiat and digital currencies.Notabene is headquartered in New York although it casts its operational net across several countries. The platform claims to empower real-time decision-making, while offering sanctions screening for counterparties and self-hosted wallet identification, all with a view towards enabling digital transactions.Partnership focusIn bootstrapping the business, it appears that FOMO Pay has been relying heavily on engaging in industry partnerships. In 2021 it joined the DBS Digital Exchange (DDex) as a member. Its purpose in doing so was to leverage the institutional grade digital custodian and exchange services offered by DDex, a service extended by DBS Bank, Singapore and Southeast Asia’s largest bank.Last year, the company partnered with Ripple, using Ripple’s On-Demand Liquidity (ODL) solution to support its cross-border treasury flows. Moving away from traditional payment rails towards Ripple’s ODL product meant that FOMO Pay could free up working capital and optimize business cash flow.As further evidence of FOMO Pay’s efforts to maintain regulatory compliance, in July the company partnered with Elliptic, a crypto asset risk management firm, in an effort to enhance its customer onboarding due diligence check process.

Next Month’s Web3 Event in Tokyo to Bridge Web3 and Traditional IndustriesCoinpost, Japan’s cryptocurrency and blockchain media outlet, is gearing up to organize WebX, an annual international Web3 conference, in Tokyo from July 25 to 26, according to a press release. Hosted by the WebX Executive Committee, the event aims to bring together a wide array of participants, including Web3 startups, established companies, and sponsors spanning various industries such as artificial intelligence and the metaverse.With this conference, Coinpost seeks to underpin the Japanese government’s Web3 initiatives and foster collaboration between the Web3 sector and traditional industries. Notably, Japanese Prime Minister Fumio Kishida is scheduled to deliver a video address during the conference.Photo by Jaison Lin on UnsplashDiverse programs and speakersWebX offers diverse programs for attendees, including presentations by esteemed Web3 projects and founders, networking opportunities, workshops, a Web3 hackathon, project exhibitions, and a GameFi event.The WebX website presents a lineup of more than 100 speakers hailing from diverse domains, including crypto exchanges, blockchain data analytics firms, gaming companies, cloud service providers, news outlets, and a political party. Binance, CoinDesk, and Square Enix are just a few examples of them.Wemade’s sponsorshipMeanwhile, South Korean gaming developer Wemade recently announced its sponsorship of the conference in a press release. At the event, Wemade CEO Jang Hyun-kook will deliver a talk titled “The Blockchain Games: Breaking Down the Boundaries of the Games.” Moreover, the Korean gaming company plans to host a networking event to promote its ecosystem among influential figures and major companies in the blockchain industry.