"We finally have the opportunity to clarify for the industry. This is a very important point for the industry. We are excited to go to court with the SEC, and we are very confident that we can win. It is time to defend the cryptocurrency."
This is the response that Kik founder Ted Livingston sent on Twitter after the company was sued by the US Securities and Exchange Commission (SEC).
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The well-known cryptocurrency project was accused by the SEC of the ICO in the local time on June 4, local time, accusing it of illegally selling securities to the American public. The SEC accused Kik Interactive Inc. of violating the registration requirements of Section 5 of the Securities Act of 1933 and is seeking permanent injunctions, rate hikes and fines.
Kik: SEC's allegations have legal flaws
Kik Interactive Inc. responded to the US Securities and Exchange Commission (SEC)'s enforcement action against Kik's 2017 issue of KIN tokens. Ked CEO Ted Livingston said:
"We have been looking forward to it for a long time, and we are very happy to have the opportunity to fight for the future of cryptocurrencies in the United States. We hope that this case will make people understand that securities laws should not be applied to millions of applications in dozens of applications. The currency used by people."
“Kin is used by more and more people every day in more and more applications. Kin is probably the most widely used cryptocurrency in the world. Although the SEC's action is a challenge that needs to be overcome, it will not affect Kin's. We expect that the momentum of the Kin ecosystem will only continue to grow, using, transferability and characteristics."
Kile legal consultant Eileen Lyon commented:
“Based on the reasons we have listed in the Wells submission, the SEC’s allegations against Kik are based on a flawed legal theory. In addition, the complaint incorrectly assumes that any discussion of possible asset appreciation is equivalent to just another Providing or committing proceeds in one's efforts; they assume that having a consistent incentive is equivalent to creating a “common enterprise”; and that any contribution from the seller or sponsor must be the “necessary” management required to create an investment contract or Entrepreneurial efforts. These legal assumptions go far beyond the definition of the Howey test, and we believe that they cannot withstand judicial review."
"It's worth noting that in November 2018 Wells notified the Kik and Kin Foundation. However, after seeing our submission to Wells, the SEC chose not to mention the Kin Foundation, nor based on Kik's pre-sale in 2017. In the case of the Kin deal that took place after the token issue, any claim was made. In our opinion, the SEC’s decision not to make such an allegation is to admit that the transactions currently taking place in the Kin ecosystem do not comply with federal securities laws."
Finally, Livingston said:
"The SEC's allegations against Kik give us a highly selective and seriously misleading description of the facts and circumstances of our 2017 pre-sale and token-issuing activities. We look forward to telling the whole story in court. ”
Kik VS. SEC: Should we expect it?
One of the reasons why Kik’s fight against the SEC caught the attention of the community was that the company started raising funds from the community last week and said that once the SEC filed a lawsuit against it, the funds would be unlocked for the lawsuit. This also made the lawsuit a struggle between the cryptocurrency community and US regulators.
CNBC cryptocurrency show host Ran NeuNer said:
"The SEC filed a lawsuit against Kik for cryptocurrency without any harm. If the SEC wins, the industry status will remain unchanged. If the SEC loses, it sets a precedent, and the US cryptocurrency company has More opportunities. We should all support Kik."
But both Stephen Palley and Marc Boiron, both lawyers, said they were not optimistic about the lawsuit. Palley said that the SEC had a lot of time to gather evidence to prove that Kik ICO was a securities issue before filing the lawsuit. Boiron laughed and said that he hoped that Kik had enough money to fight the lawsuit.
Some netizens pointed out that Kik is not the best choice for the SEC, because all aspects of the company's ICO have problems that are easy to be discovered, such as the promotion of large-scale, the blockchain technology has not been deployed at the beginning, and the technology deployment is not true. And do not understand the applicable law.
In any case, this lawsuit will become the focus of community attention, or will lay the foundation for future cryptocurrency legislation in the United States.