More likely "no chip". The "KEY" button does nothing with/for/about the RFID chip. It merely enables or disables the SKS system. The RFID chip should allow operating the car regardless of "KEY" button position, unless either the chip isn't present or was never registered to the car. Or, maybe the key slot/receiver is not functioning....... Do you have a second FOB to test?
Does the key fob have the original "shell" ? (has the Toyota logo on it?) If the shell or housing for the fob has been replaced, most do not know that the RFID chip has to be swapped over in addition to the remote circuit board. Posted via the PriusChat mobile app.
Right, the key button enables the SKS. I do not have another fob, the one I have is recognized by the car as a master, to my knowledge. I have not cracked it open to check if it has an RFID chip, however if it does that is confusing. Additionally holding my fob against the start button does nothing either which leads me to think it’s not just the slot.
The Gen 2 fob has to be inserted into the FOB slot for the RFID chip to be detected. It wasn't until Gen 3 that you could place it by the start button for detection.
Actually, the key button disables the SKS when it is pressed in. Toggle it to the 'out' position to re-enable SKS.