Kik is Canadian technically no?
If you sell a security to a U.S. Citizen then the SEC can come after you no matter where in the world you're based.
SEC Charges Kik With Conducting $100M Unregistered ICO
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Re: SEC Charges Kik With Conducting $100M Unregistered ICO
#212This filing makes it appear that Kik was attempting to scam investors. That is simply not true though. Take a look at the Kin Foundation’s github repos. This is one of the most active crypto projects there is. My company implemented Kin into our app with over 10 million users. 40 other apps have also implemented it. There are over 400,000 users spending Kin within our apps each month. Kik might have broken securities law in their offering to the public, but don’t confuse that with the resulting project also being fraudulent or a scam. It’s not.
Re: SEC Charges Kik With Conducting $100M Unregistered ICO
#213This filing makes it appear that Kik was attempting to scam investors. That is simply not true though. Take a look at the Kin Foundation’s github repos. This is one of the most active crypto projects there is. My company implemented Kin into our app with over 10 million users. 40 other apps have also implemented it. There are over 400,000 users spending Kin within our apps each month. Kik might have broken securities…
Is the technology a scam? You say no.
Is the ICO a scam? Yes, it wasn't legal.
"This filing makes it appear that Kik was attempting to scam investors."
Yes. They were. They pretended their ICO wasn't going to break securities law.
Re: SEC Charges Kik With Conducting $100M Unregistered ICO
#214Their market cap took a beating today:
https://coinmarketcap.com/currencies/kin/#charts
Kin ROI: -75%
Re: SEC Charges Kik With Conducting $100M Unregistered ICO
#215This filing makes it appear that Kik was attempting to scam investors. That is simply not true though. Take a look at the Kin Foundation’s github repos. This is one of the most active crypto projects there is. My company implemented Kin into our app with over 10 million users. 40 other apps have also implemented it. There are over 400,000 users spending Kin within our apps each month. Kik might have broken securities…
Is the technology a scam? You say no. Is the ICO a scam? Yes, it wasn't legal. "This filing makes it appear that Kik was attempting to scam investors." Yes. They were. They pretended their ICO wasn't going to break securities law.
In hindsight that seems to be the case, but in 2017 at the time of the ICO, the laws and how the SEC would interpret them was much more uncertain. They clearly decided to take a huge risk and it backfired. I’m not saying that it’s a risk I would have ever taken myself though.
Re: SEC Charges Kik With Conducting $100M Unregistered ICO
#216Earlier 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
They are looking for a test case because, per the SEC document, they were bankrupt and have literally no alternative but to fight it, as any settled penalty will sink their business.
They're so fucked. Good riddance.
Re: SEC Charges Kik With Conducting $100M Unregistered ICO
#217This filing makes it appear that Kik was attempting to scam investors. That is simply not true though. Take a look at the Kin Foundation’s github repos. This is one of the most active crypto projects there is. My company implemented Kin into our app with over 10 million users. 40 other apps have also implemented it. There are over 400,000 users spending Kin within our apps each month. Kik might have broken securities…
Is the technology a scam? You say no. Is the ICO a scam? Yes, it wasn't legal. "This filing makes it appear that Kik was attempting to scam investors." Yes. They were. They pretended their ICO wasn't going to break securities law.
> Is the ICO a scam? Yes, it wasn't legal.
Not everything that's illegal is a scam. If somebody sells me cocaine and I'm happy with the product, it's illegal but nobody was scammed.
Re: SEC Charges Kik With Conducting $100M Unregistered ICO
#218Earlier quoted context omitted.
Can you give an example of something that fails the Howey test, but is required to follow the SEC regulations that govern ICOs?
A few things to clarify: The SEC's position is that tokens are "securities" under the Securities Act and the Securities Act says that all securities must be registered if they're going to be sold to the public. Since the SEC views the tokens as securities (no different from company stock), and securities must be registered to be sold to the public, then (according to the SEC) an ICO of an unregistered token violates…
Thanks. So since cryptocurrencies aren't specifically listed but just fall under "investment contracts," and investment contracts have to pass Howey to be considered securities, doesn't that mean that cryptocurrencies which fail a Howey test are in the clear?
(I guess the SEC could claim they count as "any interest or instrument commonly known as a security" on the grounds that the SEC themselves consider them securities, but that seems a stretch. I don't know why the courts would have bothered making the Howey test if they just wanted the SEC to rule however it liked.)
Re: SEC Charges Kik With Conducting $100M Unregistered ICO
#219Earlier quoted context omitted.
This was my issue at the time too.. It was a horribly vague situation. The SEC usually acts but the penalties are usually for 1/100th of the profits. If Kik loses here they're just going to make them pay $1M 'penalty' and move on.
Why should penalties necessarily bankrupt the company? Shouldn't the penalty be proportional to the damage they created by doing things improperly?
If I have nothing and rob a bank, should I get get to keep half? Why should the penalty bankrupt me?
Re: SEC Charges Kik With Conducting $100M Unregistered ICO
#220Earlier quoted context omitted.
Why should penalties necessarily bankrupt the company? Shouldn't the penalty be proportional to the damage they created by doing things improperly?
If I have nothing and rob a bank, should I get get to keep half? Why should the penalty bankrupt me?
No, that's a much different situation. Kik could have acted legally and still made a profit on this idea, although maybe less. In your example, clearly there is no "legal" way in which you could have robbed the bank