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SEC Charges Kik With Conducting $100M Unregistered ICO

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Re: SEC Charges Kik With Conducting $100M Unregistered ICO

#171

Post by jeromegv »

nostrademons wrote: post #164
MagnumOpus wrote: post #154

Earlier quoted context omitted.

Except that they confirmed to laws and SEC regs and Kik didn't? That makes all the difference...

Uber "conformed to laws" is rich considering HN commentary on that company over the last 8 years... (To be fair, the SEC is pretty much the one government agency that Uber did not piss off - it's just the IRS, FBI, DoJ, and almost every local government in America that they're in trouble with.)

It's not rich when we talk about the SEC here. Uber conformed to laws of the SEC. The other agencies are irrelevant to that discussion.

Re: SEC Charges Kik With Conducting $100M Unregistered ICO

#172

Post by linuxftw »

penagwin wrote: post #109
linuxftw wrote: post #98

Earlier quoted context omitted.

Telling that all respondents so far named something completely different.

Telling in a good or bad way?

I'm in 'they're all scams' camp. All crypto coin backers have their pet crypto that's 'totally not a scam and it's going to the moon' apparently, and they're all different.

Re: SEC Charges Kik With Conducting $100M Unregistered ICO

#173

Post by DennisP »

berberous wrote: post #149
DennisP wrote: post #42

Earlier quoted context omitted.

First clause of the Howey Test is that there's an investment of money. Perhaps at some point the SEC lawyers will argue to a court that something can still be a security without an investment of money, but I don't think there's any particular reason to think a court will agree.

The Securities Act prevents the offer or sale of a security for "value" -- and there is precedent that giving away free securities can still be an offer of securities for "value". See this 1999 SEC press release: https://www.sec.gov/news/headlines/webstock.htm Whether something passes the Howey test and is deemed a security is a different matter, but you can "airdrop" a clear security (which certain cryptocurrencies…

In the cases described at that link, "the investors were required to sign up with the issuers' web sites and disclose valuable personal information in order to obtain shares. Free stock recipients were also offered extra shares, in some cases, for soliciting additional investors or, in other cases, for linking their own websites to those of an issuer or purchasing services offered through an issuer."

The airdropped tokens I've seen did none of those things. Someone simply created a token contract and granted initial balances based on the ETH balances of existing addresses. The new owners don't even have to know the tokens exist.

Re: SEC Charges Kik With Conducting $100M Unregistered ICO

#174

Post by loceng »

jki275 wrote: post #23
tadfisher wrote: post #14

Earlier quoted context omitted.

Because Bitcoin and Ethereum are not stand-ins for shares in a particular entity.

Eth and BTc are quite different and Eth is absolutely a security. Eth meets the Howey test. BTc arguably does not due to its manner of distribution and initiation.

Do we know for sure how it was distributed and initiated BT though? We don't even know who "Satoshi Nakamoto" is.

Re: SEC Charges Kik With Conducting $100M Unregistered ICO

#175

Post by TeMPOraL »

nostrademons wrote: post #164
MagnumOpus wrote: post #154

Earlier quoted context omitted.

Except that they confirmed to laws and SEC regs and Kik didn't? That makes all the difference...

Uber "conformed to laws" is rich considering HN commentary on that company over the last 8 years... (To be fair, the SEC is pretty much the one government agency that Uber did not piss off - it's just the IRS, FBI, DoJ, and almost every local government in America that they're in trouble with.)

Uber deserves to be burned to the ground just for the legal shenanigans it played, but if in this case they were above the board, then it's fair to say so.

Re: SEC Charges Kik With Conducting $100M Unregistered ICO

#178

Post by propter_hoc »

nprateem wrote: post #170
nyx_ wrote: post #2

"The complaint further alleges that Kik marketed the Kin tokens as an investment opportunity. Kik allegedly told investors that rising demand would drive up the value of Kin, and that Kik would undertake crucial work to spur that demand, including by incorporating the tokens into its messaging app, creating a new Kin transaction service, and building a system to reward other companies that adopt Kin. At the time Kik…

> Who even bought this stuff? North Korea probably.

Actually:

> 167. [...] Kik declined to sell Kin to investors from certain countries, including Canada, China, Cuba, and North Korea.

Re: SEC Charges Kik With Conducting $100M Unregistered ICO

#179

Post by basch »

nostrademons wrote: post #76
duxup wrote: post #70

Earlier quoted context omitted.

Well a messenger app for 8 years, but that's not really what the lawsuit is about.

They want to add payments to their messenger app. That's a known business model and a hot area right now - WeChat pioneered it, Line does it too, and Facebook is working on a cryptocurrency-based solution that does the same thing.

FBMessenger already has best in class payments built in, without crypto.

Re: SEC Charges Kik With Conducting $100M Unregistered ICO

#180

Post by Alex3917 »

mikeleung wrote: post #97
r00fus wrote: post #25

Earlier quoted context omitted.

Is their intention to set a precedent with a sympathetic court? I know a lot of other actions around the country are pushing the limits, hoping to get a favorable ruling and establish precedent (see: case vs. ACA being unconstitutional).

They are looking to be the test case to set a precedent in order to force clarity around securities laws that are outdated and unclear when being applied to cryptocurrencies

The law has been the same since the 1920s. Adding crypto to the mix has zero affect on whether or not something is a security offering.
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