Combine the yeast, the milk, the sugar, the egg and the butter in a large mixing bowl. Stir well and slowly add the flour after sifting it. Whip the mixture with a balloon whisk until thoroughly smooth and blended. Set aside in a warm place for 1 ½ hour to rise until bubbles start to form on top of the batter.
Heat the corn oil in a small saucepan and drop a small spoonful of batter in to fry. When the loukoumades are golden brown, strain them on paper towels. Heat the honey in a small pan. Serve the loukoumades in a platter drizzled with honey and sprinkled with the walnuts and the cinnamon.