Monday, January 28, 2019

The Kik back 🥊

January 28, 2019

Kik is Prepared to Fight the SEC for its ICO

In September 2017, popular messaging platform Kik conducted an initial coin offering (ICO) that resulted in over $100 million in funding in exchange for kin tokens.

According to CEO Ted Livingston, kin tokens are meant to help attract developers by monetizing the platform. In addition, users could earn kin for performing various tasks like completing surveys.

But the Securities and Exchange Commission (SEC) sees kin a bit different and now Kik is being accused of running an unregistered securities sale.

The Howey Test breakdown

To determine whether or not an ICO was a securities sale, the SEC used a simple test that has stood since 1946.

According to the Howey Test, your project is a security if:

It is an investment of money
There is an expectation of profits from the investment
The investment of money is in a common enterprise
Any profit comes from the efforts of a promoter or third party

Basically, the SEC is saying that when Kik succeeds, kin succeeds, and investors knew that.

Kik doubles down

Kik won't go down without a fight though.

In December, the company filed a 39-page report to explain why its ICO falls under the realm of "utility" tokens rather than a security.

As of now, the SEC has yet to respond since it is likely reviewing the document.

However, Kik is pretty confident. If the SEC does respond with the same action, Kik's lawyers say it would be a "deeply flawed regulatory and enforcement approach."

OPINION

JP Morgan Chase: Crypto Will Only Have Value in a Dystopian Economy

When all the world's reserve assets like gold, euro, dollar, yen and the payment system crumbles, only then will crypto have real world value, according to investment bank JP Morgan Chase.

The bank went on to argue that although Bitcoin has a zero correlation to traditional financial markets, a falling value is useless to portfolio managers.

Restating the obvious

This isn't an anti-crypto argument.

Actually, Bitcoin was born out of the idea that there would be no trust in banks, the federal reserve, or any central entity because if things do go south quickly among these assets, Bitcoin will continue running its same code per usual.

Other cryptocurrencies would follow similar steps as well.

Bearish tones

Regardless, JP Morgan Chase has shown its fair share of bear sentiment over the years with its CEO actually calling Bitcoin a "fraud" in 2017.

Since then, he has retracted that statement but still warns investors to "beware."

RESEARCH

Wikipedia Page Views Don't Correlate to Market Cap

A new report by analytics firm DataLights shows that page views on the Wikipedia pages of different projects don't necessarily align with the market.

The top 8 projects by Wikipedia page views:

Bitcoin
Ethereum
Basic Attention Token
XRP
Bitcoin Cash
Monero
Dogecoin
Litecoin

Out of these, EOS, TRON, and Tether all lost their spots.

While bulls and bears alike point either way saying this means a project is overvalued or undervalued, DataLights thinks it's simply because older projects are more recognizable to the industry.

BITS