Kik Fights Back; Submits Exhaustive Report Against SEC’s Cryptocurrency Lawsuit
Kik Interactive’s instant messaging mobile app- Kik Messenger faced complaints from SEC which were filed against the company in June this year. During the lawsuit, which was filed by the U.S. Securities and Exchange Commission (SEC) against the Canadian messenger company, the platform aggressively defended itself and clarified its image.
The background of the Lawsuit filed by the SEC-
The complaints were more like bits and pieces that were taken from different times and situations and were produced together to paint a contrived image of the messenger company. The complaint projected that the messenger company due to the scarcity of funds is reaching out to an ‘unregistered securities’ which is offered through Kin tokens sale. Basically, such measures were taken to save the company from the financial crunch, as per the complaint filed in the month of June.
The apparently insurmountable mountain-
The U.S SEC deduced the situation of the company based on the 18-months-long investigation through interviews, document investigations. This naturally put the company in a tough spot. And when strong authorities such as the SEC sue any company, the situation naturally becomes quite heavy and difficult to handle.
The messenger company lashed out in defense-
After learning about the forthcoming lawsuit, the messenger company promised to defend itself hard, and it also made up its mind for claiming multi-million-dollar legal defense fund. The intention of the messenger company is to defend cryptocurrency. The companies who supported the cause initially derailed from their support, but Kik forged ahead and moved ahead strongly while keeping true to its intent and promise made in June.
The Battle Royale-
The messenger company lashed out in defense with a detailed report of 117 pages which had a three-page-long introduction section. Getting such a detailed report from a defendant is an unusual seen in the court, as these kinds of details usually are expected from the plaintiff. In the report, Kik explained how the facts had been twisted, and the way in which they are presented is misleading and contrives the reality in a very unrealistic direction. The report said that the SEC had made a-
“[…] highly selective and misleading depiction of the record.”
As per the SEC’s report, one of the Board members of Kik says that the company-
“[…] decided to ‘pivot’ to entirely different business and attempt what a board member called a hail Mary pass.”
In answer to this allegation, Kik’s report opened up the entire context through which these above bits were taken. The report explained that the ‘actual’ quote was as follows-
The more I think about it, and I think this is a great idea. People call a cryptocurrency a hail Mary, but to me, that is a long shot, and I really do not think it is a long shot.
Splash on the SEC?
The three-page-long introduction is filled with such shocking defense. The fact that the reality was contrived and the bits from facts were used in the collage that narrates an entirely different picture shouts bad image on SEC’s report competence. In the introduction, there are two more such explanations where the facts were twisted. Whether the messenger company sold the unregistered securities, is still a question to be answered, but before that, such twisting of facts is pulling off other ugly realities too.
The big question- ‘What is the main purpose behind selling Kin Token, after all’?
Further, the complaint continued that on one hand, the core principles of the messenger company revolve around being ethical, but “the philosophy of the acquiring company was to collect and sell user data,” as per the SEC report. In answer, the report from the messenger company states that it is not clear why the Commission is having an ‘apparent contempt’ against Kik for generating revenue from Kin. The token’s main purpose was not just to fund operations, as per Kik’s report. The company nullified the comments from a low-level employee about the selling of the sticker to satisfy the lawyers and stated that it was completely wrong, as the employee had no clue what he was talking about.
Let the dust settle, Truth will reveal itself for sure!
The iron is hot from both sides. Both the sides are claiming strong facts, and it will take time to allow the dust to settle before reality presents itself to us. How dramatically one states the facts, or an imagined-up story is of less importance when it comes to the truth. Soon, we should get to know the real story about Kin token, what is its utility, and the application. Whether the final judgment will declare Kin as a currency or not, or whether SEC will need to re-work on its fundamentals, is a thing that awaits us in the future.
If Kik is playing smart by playing on reverse psychology of the allegations put by the SEC, it can put itself into deep troubled waters, given the SEC is here since a long time and holds the experience to tackle all kinds of situations. The dramatic reports may have the capacity t stretch the case for a tad bit longer than other cases, but one must not forget the famous saying- ‘A Lie Can Travel Halfway Around the World While the Truth Is Putting On Its Shoes.’