Messaging App Kik Becomes SEC Casualty, Shuts Down Operations

Messaging app Kik, already embroiled in a contentious court battle with the SEC over the 2017 initial coin offering (ICO) of its Kin token, is shutting down. The company’s announcement was made in a blog post published earlier today, after reports surfaced online that it had laid off 70 people from the development team for Kin. The Kin Foundation team confirmed the layoffs as a “restructure” in their operations on a Reddit thread.

CEO Ted Livingston told online publication Coindesk that the decision to shut down Kik was “a direct impact from the SEC legal action.” After Kik filed a lawsuit challenging its classification of Kin tokens as securities, the federal agency filed its own damning lawsuit in the courts, charging the company with an unregistered sale of securities in its 2017 ICO. The suit quotes extensively from company email correspondence and presentations and accuses Kik of launching its token as a “Hail Mary Pass” measure to raise funds for its floundering business.  

While Kik may be shutting down, Livingston clarified that the company intends to continue development of the Kin blockchain and token with an “elite” 19-person team that will be focused on “converting Kin users into Kin buyers.”

“So, while the SEC might be able to push us around, taking on the broader Kin Ecosystem will be a much bigger fight,” he wrote. He also claimed that Kin has over 2,000,000 monthly active earners and 600,000 active spenders.

The Kik team tried to drum up support for their fight before the shutdown. They launched a website to soliciting donations for its case against the SEC but it found few takers. Prominent members of the crypto community also expressed reservations about being associated with it. Livingston also toured media outlets to make his case against the SEC but his efforts were not enough to save Kik.

After reporting on the shutdown, Coindesk wrote that Kik CEO Ted Livingston had apparently sent drunken texts by mistake to one of its reporters stating that he was quitting. The textmay have been originally intended for Kik Board member William Mougayar, but was sent to a Coindesk reporter named William Foxley. “Will, I know I’ve been drinking, but this ain’t the drink talking, I’m [fed] up with this shit,” he wrote. “We’ll talk more in the morning about replacement, but i quit.”

Livingston has denied sending the texts.

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