Results 1 to 7 of 7

Thread: Weird drama involving minor cryptocurrency causes closure of Kik, a huge messaging app

  1. #1
    Owner Dan Druff's Avatar
    Reputation
    4620
    Join Date
    Mar 2012
    Posts
    32,181
    Blog Entries
    2

    Weird drama involving minor cryptocurrency causes closure of Kik, a huge messaging app

    This is a really, really odd story, and I don't know what to make of it.

    For those unfamiliar, Kik is a messaging app with 300 million users. It's similar to texting, except it's free to download and use, and does not require a phone number. It's kind of like a more modern version of AIM.

    It is extremely popular with teens, but adults use it, as well. Created in 2010, Kik has had its share of controversy over the years. Some have criticized it as a way teens can exchange messages with strangers online without their parents being able to see. In many cases, parents aren't even aware that Kik is a messaging app. This has also led to a lot of sex crimes against minors committed via Kik. These crimes include pedos talking kids/teens into sending explicit pictures, as well as those same pedos actually meeting kids in person, after having spoken via the app. Kik, based out of Canada, has also been notoriously uncooperative with law enforcement, refusing to store messages on their servers, and sometimes rebuffing law enforcement requests for user information.

    Now Kik is closing down, but not for the reasons anyone would have ever expected. They're not shutting down due to any of the concerns noted above. Instead, they're closing down an app with 300 million users in order to go forward with a little-used cryptocurrency with seemingly no viable future.

    Kin (notice the very similar spelling to Kik) is a minor cryptocurrency which never really caught on. Each Kin is currently worth 0.0008 cents -- an all time low. You could have well over 120,000 Kin for a dollar.

    In January 2018, a Kin was worth 0.12 cents. It has since fallen in value by a factor of 150. Wow. It has even fallen in value by 9 times since March 2019. The daily volume is less than $1 million, and the market cap is laughably less than $7 million.

    Ted Livngston, CEO of Kik and creator of Kin, has some bizarre obsession with his failed cryptocurrency. He's apparently been in a long battle with the SEC regarding Kin and whether or not it's a "security". As a result, he has decided to shut down Kik and fire over 80% of his workforce, leaving just 19 people at the company, all of whom will be fighting for Kin's survival.

    It is true that Kik probably loses money, as Livingston alluded to in his September 23rd blog, where he announces Kik's shutdown and explains the reasoning.

    Kik's problem was that, despite its huge userbase, they never monetized it well. All major services on it are free, and there's no real advertising on the app. Presumably they are still looking to find a way to monetize it. Still, you'd think an app with a userbase that size would be of value, even if just to be sold. Instead, it's completely closing.

    The date of Kik's closure will be announced later this week, but it's expected to occur within 2 weeks, and perhaps before October 1.

  2. #2
    Owner Dan Druff's Avatar
    Reputation
    4620
    Join Date
    Mar 2012
    Posts
    32,181
    Blog Entries
    2
    So I've looked into this more, and I got a bit more clarity.

    In 2017, after 7 years of burning through investor money Galfond-style, Livingston invented Kin, and sold it via an ICO (initial coin offering).

    Amazingly, he raised $98 million. I hadn't even heard about this until now. These investors also lost their shirt, as I mentioned earlier that the market cap for Kin is now under $7 million.

    Separate from that, the SEC called this ICO an unauthorized sale of securities. In short, they felt that Kin was basically a sham meant to raise more money for Kik, and wasn't a real cryptocurrency meant for serious use or trading.

    From May to September 2017, Kik offered and sold 1 trillion digital tokens called “Kin.” More than 10,000 investors worldwide purchased Kin for approximately $100 million in US dollars and digital assets — over half of this sum coming from investors located in the United States. However, Kik’s offer and sale of Kin was not registered with the SEC, and investors did not receive the disclosures required by the federal securities laws.
    https://www.sec.gov/litigation/compl...-pr2019-87.pdf

    The SEC also called the offering of Kin a "hail Mary" attempt to save Kik, which does appear to be accurate.

    Anyway, this all makes a lot more sense now.

    However, I'm still wondering why they're giving up on Kik and focusing on Kin, rather than the other way around. Kik is the property with the real future, and at the very least, it should have some substantial sale value at this point. Shutting it down would greatly decrease that value, were they to sell it later.

    It's possible that they are facing such steep legal liability due to the ICO of Kin, that saving Kik is immaterial at this point, unless they can beat the SEC. So perhaps they really are just trimming the fat and giving up on Kik, in order to throw all of their remaining resources into fighting the SEC, and then going from there if successful.

    Either way, I can't see this ending well. Looks like they blew their load with their one good idea in Kik, and have nothing to show for it but a big SEC case against them. What a mess. How you can have a 300 million user app and virtually no income for 9 years is just shocking, if you really think about it.

  3. #3
    He must be blinded by a Micon-style crypto ascension to wealth and fame. Anyway, it sounds like a good thing the kik app is going dd.
    Ship it crucial

  4. #4
    Maybe this is your spot to get rich. Heck, it only costs a dollar to see. Might as well buy a dollar's worth.

    :P
    Ship it crucial

  5. #5
    I saw the truncated thread title in the new post list and thought this was going to be another story about a poker Facebook friend

    Weird story involving minor


    Isn’t that how it always starts? I clicked on it which probably says more about me.

  6. #6
    Looks like a desperate play to rebuff the SEC claim that KIN was a sham to fund KIK, by abandoning KIK, and thereby being able to assert that KIN is a genuine venture, and therefore the ICO wasn’t scammy.

     
    Comments
      
      BCR: My initial impression
    Quote Originally Posted by Tyde View Post
    I stay to myself and keep out of trouble and/or potentially problematic scenarios

  7. #7
    Owner Dan Druff's Avatar
    Reputation
    4620
    Join Date
    Mar 2012
    Posts
    32,181
    Blog Entries
    2
    Kik will shut down on its ninth birthday: October 19, 2019

    https://decrypt.co/9706/messaging-ap...ninth-birthday

Thread Information

Users Browsing this Thread

There are currently 1 users browsing this thread. (0 members and 1 guests)

Similar Threads

  1. Replies: 36
    Last Post: 09-18-2018, 03:55 PM
  2. The NBA relegated to a minor league sport
    By limitles in forum Flying Stupidity
    Replies: 3
    Last Post: 05-02-2018, 07:39 PM
  3. Cryptocurrency scams
    By CryptoNinja in forum Scams, Scandals, and Shadiness
    Replies: 13
    Last Post: 12-02-2017, 05:01 PM
  4. More drama on RealGrinders involving another possible scammer
    By ftpjesus in forum Scams, Scandals, and Shadiness
    Replies: 3
    Last Post: 04-04-2017, 05:55 AM
  5. LV tv station uncovers minor gas attack on the strip in January
    By LegallyNonBindingPosts in forum Flying Stupidity
    Replies: 2
    Last Post: 05-03-2016, 11:38 AM

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •