News by Altcoin Buzz: Rickie Quist
The SEC has filed a suit against Kik for their unregistered ICO during the launch of the token in 2017. Kin is currently down more than 36% following the announcement.
The SEC is accusing Kik of raising $100 Million through a digital token sale in 2017. The SEC says that the token sale was done without following section 5 of the Securities Act of 1933, which requires offerings to be registered. The Kin messaging app hasn’t been a success from a financial perspective, and therefore, the SEC is speculating that the $100 million is being used to cover debt caused by the Kin app. The problem for Kin isn’t that they raised funds via an ICO, but what the SEC is accusing Kin of, is that they were raising the money through false marketing, by offering different services that weren’t there or didn’t even exist.
Kin has been in trouble with the SEC before and that has now lead them to create a site called DefendCrypto.org; a project raising money to fight back against the SEC.
Kin was popular when it was first launched, however, it is trading at a fraction of its all-time high. The lawsuit from the SEC has affected the price in a very negative way and it is currently down more than 36%. With Bitcoin down more than 10% in the last 24 hours, Kin is struggling even more. The market cap before the announcement was approximately $27.000.000 and now as low as $11.300.000 – a huge decrease due to some bad news for Kin.