This is the prototype for Boom Knuckles action figure. These will be released in 2 sizes: 5 inch & 3 inch. (So about like Jazwares) These figures will be made by Tomy instead. This photo is from 2014 Toyfair. Yes, he's supposed to look like that, the "Boom" design changes Knuckles' body to basically a big cheese-wedge shape. It's clear that this figure is a prototype though. You can spot the inconsistencies that aren't finished:
Shoes are unpainted, bracelet is unpainted, upper arm bandages are missing/not sclupted on there, chest stripe is missing. It's good to see they're sculpting the excessive bandages, because if an art is going to have a gimmick, it's nice that it's done solidly/well. Notice that he has fingers too, as the Boomstyle dictates.