After SEC lawsuit over ICO, KiK considers shutting down its messaging app

It was reported recently that Kin, a subsidiary focusing on the crypto market, has laid off 70 employees. Ted Livingston, CEO of Kik Interactive, announced on Monday that Kik will also be shutting down its core messaging service.

KiK is a Canadian social media and messaging app company. According to CEO Ted's post on 9/23, as stated in the article, the ongoing dispute with the U.S. Securities and Exchange Commission (SEC) has forced Kik to shut its doors. He said:

This is a direct result of SEC's legal action.

He further mentioned that apart from shutting down the app, the company will reduce its crypto business to only 19 core developers to ensure that the KIN token can expand to become the true currency of the future internet. Employees who received layoff notices can choose to transition to a new company operating in the same field.

Legal Conflict

There was a dispute between KIN token and the SEC during its initial coin offering (ICO) in 2017, where approximately $100 million was raised.

Steven Peikin, Co-Director of SEC's Enforcement Division, stated that through the sale of Kin tokens, Kik deprived investors of material information that they were entitled to, hindering investors from making informed investment decisions.

Kik's lawyers stated:

SEC cherry-picked quotes, distorted facts to support their allegations, as they lacked strong evidence to support their claims.

Meanwhile, Kik initiated a $5 million crypto fundraiser to finance its lawsuit against the SEC, overseen by the Blockchain Association, an association that brings together many blockchain advocates.

Related Readings

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