US SEC Takes on Kik Project with Accusations of Selling Unregistered Securities
Kik counteracts the claims of the Securities and Exchange Commission, even raising $5 million to mount its own lawsuit.
The KIN digital asset project launched by the Canadian chat app Kik is set for a serious fight with the US Securities and Exchange Commission. As seen in a recent lawsuit filing by the SEC, Kik Interactive, Inc. may have sold unregistered securities in the period between May and September 2017.
Kik’s CEO Ted Livingston spoke against the accusations in a recent press release explaining why the KIN token was not a security, and that the project should be given leeway for innovation.
“We have been expecting this for quite some time, and we welcome the opportunity to fight for the future of crypto in the United States. We hope this case will make it clear that the securities laws should not be applied to a currency used by millions of people in dozens of apps,” said Livingston.
While KIN remained one of the more obscure ICOs and the asset is far from the center of the digital asset community, the launch of a lawsuit may have repercussions for other ICO projects conducted during the boom times of 2017 and 2018.
In the past weeks, the KIN project admitted to having attended multiple hearings with the US SEC over the past months. The project went as far as to open a fundraiser to defend itself in court, as the SEC moved closer to an opinion that KIN tokens fit the definition of a security.
The KIN digital asset remains something of an anomaly, despite the claims of Livingston that the token actually achieved widespread adoption:
“Kin is being used by more people in more apps every day, and come trial, Kin may be the most widely used cryptocurrency in the world. While the SEC's actions are a challenge to overcome, they won't affect the use, transferability and characterization of Kin, and we expect momentum in the Kin Ecosystem to only continue to grow.”
Currently, the KIN token is in a process of migration, switching the Ethereum-based tokens with a new asset based on the Stellar technology. The actual blockchain built by Kik is a whole new system of servers, choosing a higher level of centralization to achieve higher speed.
The KIN asset is barely represented on exchanges, and has remained lower than its ICO price. The current news with troubles from the US SEC crashed the price by 29% overnight, to $0.000025. During peak times, KIN moved closer to the one-penny range, but has remained stagnant since.
KIN reports decent transaction activity, as it is used within Kik-based apps, as a reward token. Blocktivity indeed lists KIN as the second most active digital asset after EOS, with more than 5 million transactions per day.