One of the biggest stories of 2019 within the crypto world was Kik, a popular Canadian messaging app choosing to take on the SEC in a lawsuit that would help properly define what constitutes as a security token. The SEC had determined that Kik had organized an unauthorized security sale of the Kin token which is native to the app. Kik responded saying that the Kik token was a utility token and not a securities token and then sued the SEC for false categorization. The legal battle to follow was, naturally, going to be a complicated one but it seems that Kik has taken a significant hit as a result.
On September 23, 2019 a report was published which alleged that Kik was considering shutting down its mobile app on this came allegedly from two anonymous sources within the company as of late.
The Death of Kik
Unfortunately, these rumors appear to be true as a blog post by the CEO Ted Livingston was recently published which confirms that the Kik app will be shutting down and also that the company’s employees will be reduced to 19 people in total. 70 people have already been laid off but have also been given the option to transfer to another firm that works within the same sector. This marks the death of one of the most popular messaging apps in the world.
The reason for the shut down is because the company wishes to manage its resources while gearing up for a legal battle against the SEC over the issue of registered or unregistered securities tokens. The SEC says that Kik denied investors important knowledge about the tokens when they invested in them, mainly that it was a security and a non-registered one at that. Kik has also alleged that the SEC has taken deliberate efforts to sabotage the Kik token an even as a lawsuit rages on.
“While we are ready to take on the SEC in court, we underestimated the tactics they would employ. How they would take our quotes out of context to manipulate the public to view us as bad actors. How they would pressure exchanges not to list Kin. And how they would draw out a long and expensive process to drain our resources,” the blog post says.