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>The complaint further alleges that Kik marketed the Kin tokens as an investment opportunity. Kik allegedly told investors that rising demand would drive up th

>The complaint further alleges that Kik marketed the Kin tokens as an investment opportunity. Kik allegedly told investors that rising demand would drive up the value of Kin To be fair... Yes Kik did sell them as investments... claiming rising demand would drive up the price of Kin... which did indeed happen. The kin tokens increased in value over 10x from the price they were sold to investors at. It didn't last, of course. I still don't understand why they didn't get SEC approval before offering the token sale, however. They were savvy enough not to allow Canadian investors for that very same reason... because they're a Canadian company and did not want to get mixed up in unregistered securities sales in Canada.

btown 7y ago
From the complaint https://www.sec.gov/litigation/complaints/2019/comp-pr2019-87.pdf https://www.sec.gov/litigation/complaints/2019/comp-pr2019-8... : > Kik has agreed to jurisdiction in the United States concerning disputes relating to Kin. When selling Kin to the general public, Kik required investors to agree that all disputes about the purchase and use of Kin would be heard by an arbitrator or court in the United States, specifically in the State of Delaware. So they should have known. And maybe they did, thinking that if they tried to register with the SEC their fundraise would not be allowed and the company would almost certainly declare bankruptcy; but that if they did not register, even after the DAO report, they'd at least have a chance of sneaking through, and if they were caught, they might avoid personal liability. Many people disobey the law out of desperation, and if nobody goes to jail, then disobedience becomes even more likely for those in such a situation.
- flyGuyOnTheSly 7y ago
  >their fundraise would not be allowed and the company would almost certainly declare bankruptcy That was my best idea as well as to what they were thinking at the time. Take money now and worry about the consequences later, or go bankrupt now and worry about that now.
thesausageking 7y ago
> I still don't understand why they didn't get SEC approval before offering the token sale, however. Because what they did was illegal and the SEC would never have approved it. To do it legally, they would've had to only sell to accredited investors and there's no way they raise $100m doing that.
- xs83 7y ago
  And "accredited investors" only are the antithesis of crypto, the fact that people of any age are able to participate in this was the reason it was so successful as an ICO. They marketed the product offering specifically at teens (Kik's demographic).

btown 7y ago

From the complaint https://www.sec.gov/litigation/complaints/2019/comp-pr2019-87.pdf https://www.sec.gov/litigation/complaints/2019/comp-pr2019-8... : > Kik has agreed to jurisdiction in the United States concerning disputes relating to Kin. When selling Kin to the general public, Kik required investors to agree that all disputes about the purchase and use of Kin would be heard by an arbitrator or court in the United States, specifically in the State of Delaware. So they should have known. And maybe they did, thinking that if they tried to register with the SEC their fundraise would not be allowed and the company would almost certainly declare bankruptcy; but that if they did not register, even after the DAO report, they'd at least have a chance of sneaking through, and if they were caught, they might avoid personal liability. Many people disobey the law out of desperation, and if nobody goes to jail, then disobedience becomes even more likely for those in such a situation.

flyGuyOnTheSly 7y ago
>their fundraise would not be allowed and the company would almost certainly declare bankruptcy That was my best idea as well as to what they were thinking at the time. Take money now and worry about the consequences later, or go bankrupt now and worry about that now.

thesausageking 7y ago

> I still don't understand why they didn't get SEC approval before offering the token sale, however. Because what they did was illegal and the SEC would never have approved it. To do it legally, they would've had to only sell to accredited investors and there's no way they raise $100m doing that.

xs83 7y ago
And "accredited investors" only are the antithesis of crypto, the fact that people of any age are able to participate in this was the reason it was so successful as an ICO. They marketed the product offering specifically at teens (Kik's demographic).