Kik has announced a Crowdfunding of up to $5 million USD to assist in a project they name Defend Crypto that was initiated to fight against the U.S. Securities and Exchange Commission (SEC) in court over the 2017 Kik ICO which SEC dubbed a security.
The project aims to not only help Kik against the troubles being experienced from SEC but to also help many other crypto projects facing the same problem. Kik emphasised that many other projects are going through this trouble but handling it in silence, so it is high time they came out and announce to be able to win the fight.
“In January 2019, Kin came out publicly to share what has been going on behind the scenes with the SEC. This has been a burden for not just Kin, but many others in the space who are optimizing for regulation before innovation. Everyone is always asking “what will the SEC think?” instead of “what is best for consumers?”
Despite the fact that last month over 300,000 people earned and spent Kin as a currency, the SEC is still saying that it might be a security. After months of trying to find a reasonable solution, Kin has been unable to reach a settlement that wouldn’t severely impact the Kin project and everyone in the space. So Kin is going to take on the SEC in court to make sure there is a foundation for innovation going forward.” Kik said on the Defend Crypto website.
Unchained reported: “Ted Livingston, CEO of Kik and the founder of the Kin Foundation, and Patrick Gibbs, partner at Cooley, announce the formation of the $5 million DefendCrypto.org fund at Coinbase Custody to fight the SEC in court. Kik and Kin are hoping that a lawsuit would eventually result in a new Howey test for crypto tokens, to determine which ones are a security”.
Kik is however emphasising that their token is not a security but a currency, but SEC doesn’t seem to agree and has been coming back to hunt the project. Kik claimed they first reach out three days after the ICO and since then have never backed out even though kik has been complying with all rules and trying to have the case resolved. The Website displayed a timeline of all events with SEC and stated:
“The SEC first reached out to Kin three days after the token sale, and since then Kin has continued to comply with all of their requests and work hard to find a path forward with the SEC. Despite the regulatory overhang, the Kin ecosystem continues to grow with more and more developers building with Kin, and more and more people using Kin as a currency. Below is a timeline of events going all the way back to the token sale. During this entire time, Kin has been trying to find a reasonable settlement but has been unable to do so. “
SEC many really not back out because it seem to be their policy, SEC chairman Jay Clayton has been previously quoted as saying:
“I believe every ICO I’ve seen is a security.” He added: “I want to go back to separating ICOs and cryptocurrencies. ICOs that are securities offerings, we should regulate them like we regulate securities offerings. End of story.”
Kik Stated that they already set aside a $5 million fund to tackle the case but it seem to not be enough so hey decided to do a Crowdfunding to gather another $5 million.