In a blog post, Ted Livingston, Kik Interactive’s chief executive, explained that Kik Messenger’s demise is a casualty of the bitter legal stoush between the US Securities and Exchange Commission and the controversial Kin cryptocurrency.
“We set out to build a new economy that offered equal opportunity to billions of people,” said Livingston. “Today millions of consumers and hundreds of developers [use] Kin. When it comes to consumer adoption Kin is the most used cryptocurrency in the world.”
But the SEC was not quite as enthusiastic, and in June charged the company with “conducting an illegal US$100 million securities offering of digital tokens..without registering their offer and sale as required by US securities laws”.
Kik Interactive will cull 80 of its 100-person team, reducing its cash burn rate by 85%, so that it can channel funds into its legal expenses.
Livingston has positioned the battle as one that affects all cryptocurrencies, explaining that becoming a security would “kill the usability of any cryptocurrency and set a dangerous precedent for the industry.. So we made the decision to step forward and fight.”
The Kik platform has been dogged by controversy because its anonymised, uncontrolled nature has made it popular with teenagers, but also helped it to become a vehicle for the distribution of exploitative images.