The American stock exchange Supervisory authority has on 4. June announces that she’s suing the crypto Start-up KiK. Accordingly, the Securities and Exchange Commission (SEC) KiK have their Initial Coin Offering (ICO) in the amount of US $ 100 million performed illegally.
By Phillip Horch
5. June 2019BTC$7.697,00 -3.80%part Facebook Twitter LinkedIn xing mail
That you do not mess with the U.S. securities and exchange Commission without consequences, you can think of. But it is precisely this attempt has started, the crypto Start-up KiK already in January. However, the Messaging provider is trying to prevent a classification of the KIN-Tokens as a value document or Security Token. According to their view, this was seen much more as a Utility Token and does not therefore fall under the securities laws.
at the end of may KiK has launched a Crowdfunding campaign. For a lawsuit against the SEC, KiK tries to $ 5 million in crypto-currencies to collect.
the response of The SEC was, however, not have to wait long. The authority has issued a press release announcing that they have carried out their Token Sale is illegal. Accordingly, the authority does not deviate from its classification of the Token as the securities:
The SEC alleges that KiK has sold the Token to US investors without registering their offer and their sale in accordance with U.S. securities laws.
in addition, the indictment continues, have brought to the ICO investors for their deposits. Although this is a total of 55 million US were able to collect dollars from investors. Up to the time of the indictment, they had lost more than half their value. In addition, the company had committed Marketing errors:
The allegation is also that KiK had marketed the KIN-Token as an investment opportunity. KiK is said to have told investors that rising demand would increase the value of KIN, and that KiK would make a decisive work to stimulate demand, among other things, by the Integration of the Token in its Messaging App, the creation of a new […] transaction service, and the establishment of a system to reward other companies […].
KiK shines with empty promises
The promised services did not exist at the time of the offer, you have can buy with the tokens, nothing. The promise on the part of the crypto Start-ups have also included a sale of the tokens on the secondary markets, both KiK and investors would benefit from the alleged increase in value. Accordingly, the ICO securities include transactions:
By selling $ 100 million in securities without registering the offers and sales, we suspect, that, KiK has denied the investors the information to which they were legally entitled. In order to have prevented investors from well-informed investment decisions. Companies do not have a binary choice between Innovation and compliance with the securities laws,
so Steven Peikin, Co-Director of the SEC Division of Enforcement, the current judgment, the SEC sealed.
crypto Start-up fights back
A response from the company was for a long time. Ted Livingston, CEO of KiK said in a press release that they would continue to fight for the future of crypto-currencies in the United States, their KIN-tokens could establish itself soon to the world’s most popular crypto-currency:
Even if the actions of the SEC are challenges that must be addressed, they will not affect the use, Transferability and characterization of KIN […].
Further, the indictment in the view of the Messaging provider is based on false assumptions:
The prosecution is, among other things, incorrectly believe that any discussion of a possible increase in the value of the same, such as profits, offer or promise. […] These legal assumptions to strain the Howey Test far beyond its Definition and we do not believe that you will hold a legal procedure.
A date for the hearing is still pending.
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