o3n [ozone] blockchain layer

Blockchain source

Menu
  • Cybersecurity services
Menu

Social Media Platform Kik Promises to Challenge Proposed SEC Enforcement Against Its ICO

Posted on January 28, 2019 by nbelov

Kik says the SEC will be “doubling down on a deeply flawed regulatory and enforcement approach” if it pursues an enforcement action.

Tokenized social media startup Kik has warned United States regulators that they would fight back against a proposed enforcement action against the company, the Wall Street Journal (WSJ) reported on Jan. 27.

Canada-based Kik is facing a prospective enforcement action over an alleged securities infraction, after the U.S. Securities and Exchange Commission (SEC) judged its 2017 initial coin offering (ICO) to have involved the sale of unregistered securities.

The startup is reported to have raised around $100 million in “kin” tokens for its chat-based social media network — which can be earned on the platform, traded or redeemed for goods and services.

In a blog post published yesterday, Kik CEO and founder Ted Livingston stated that the startup was poised to fight against the action, arguing that the crypto space as a whole must challenge the application of securities laws to emerging assets such as decentralized platform tokens.

The enforcement action against Kik —  first recommended on Nov. 16 — is yet to be authorized by the agency’s commissioners. In the United States, if the SEC deems that a securities infraction has occurred, it issues an enforcement action recommendation, as well as a letter to the company under scrutiny — known as a “Wells Notice.”

The proposed action must subsequently be authorized in a vote by the agency’s commissioners, and the company in question is given thirty days to issue its response and/or rebuttal in a “Wells Response” letter.

Kik’s letter — submitted to the agency on Dec. 7 — argues that the SEC’s “‘regulation by enforcement’ approach has [to date] had a dramatic and negative impact on the development of blockchain and cryptocurrency technologies in the United States, as innovators have either directed their activities overseas or shelved their projects altogether.”

The letter notes that the U.S. regulators would be “doubling down on a deeply flawed regulatory and enforcement approach” if the recommended enforcement action was authorized.

The startup says it is emphatically not asking the SEC to change the law to accommodate disruptive technologies; on the contrary, it argues that the SEC has erred in stretching the definition of an investment contract under securities laws “beyond its original meaning and intent”:

“The Commission has strayed well beyond the scope of its statutory authority to regulate the offer and sale of securities. But [this] attempt to water down the Howey analysis to expand its regulatory authority will not stand up to meaningful judicial scrutiny.”

As the WSJ notes, this implies that if the SEC indeed pursues its enforcement action against Kik, the case is likely to culminate with a judge in a civil court case being called upon to rule on — and potentially set an important precedent for — the question of whether ICO sales are to be regulated as securities offerings in the country.

As reported today, Monero (XMR) core dev Riccardo “Fluffypony’” Spagni echoed Kik’s position in warning that innovators will increasingly turn to regulatory arbitrage and adopt jurisdictions that are more open to decentralized projects and crypto-friendly regulation.

Source: Cointelegraph https://cointelegraph.com/

Recent Posts

  • Blockchain in Education Market Expected to Witness a Sustainable Growth Over 2029 | Sony Global Education, odem.ioÂ, Open Source University – Designer Women – Designer Women July 1, 2022
  • Ripple: Government of Colombia Set to Utilize XRPL Blockchain for Land Registry – U.Today July 1, 2022
  • Blockchain Identity Management Market 2022-2028: Featuring Key Players Amazon Web Services Inc., Microsoft, IBM & Others – ResearchAndMarkets.com – Business Wire July 1, 2022
  • $23.3 Billion Global Web 3.0 Blockchain Market Growth with GAGR of 41.6% 2022-2028 | The Benefits such as Improved Privacy & Secure Network Driving the Market – GlobeNewswire July 1, 2022
  • Blockchain Bites: A$DC used in Carbon Credit purchase; Three Arrows to be liquidated in BVI; Laying the first blocks of US crypto regulatory reform; Hong Kong to licence VASPs and regulate market conduct – Lexology July 1, 2022
  • Minima's cooperative Blockchain network reaches 120000 complete nodes – IBS Intelligence July 1, 2022
  • 'Global Economy Can Be Fixed By Digital Transformation And Blockchain Technology' – Entrepreneur July 1, 2022
  • Global Blockchain Technology in Healthcare Market Report 2022-2027: Rising Application of Blockchain in Healthcare Claims and Billing Driving Growth – ResearchAndMarkets.com – Business Wire July 1, 2022
  • Laura K. Inamedinova on Maximizing Press for Blockchain Projects – Crypto Mode July 1, 2022
  • Coinbase denies reports of selling customer data to the US government July 1, 2022
  • Not giving up: VanEck refiles with SEC for spot Bitcoin ETF July 1, 2022
  • Bitcoin price: June close barely beats 2017 high as Coinbase Premium flips positive July 1, 2022
  • Key Takeaways | Crypto, Smart Contracts and Blockchain—Execution and Innovation – Lexology July 1, 2022
  • MakerDAO members shoot down proposal for more centralization July 1, 2022
  • OwlTing enlists Dow Jones database to enhance blockchain transaction security – DIGITIMES July 1, 2022
  • Multisigs mean funds in bridges are 'one small slipup' from being hacked July 1, 2022
  • Hundreds of Bored Ape owners sign up to hire out their NFTs to brands July 1, 2022
  • Better days ahead with crypto deleveraging coming to an end: JPMorgan July 1, 2022
  • Ethereum fork a success as Sepolia testnet gears up to trial the Merge July 1, 2022
  • Worst quarter in 11 years as Bitcoin price and activity plunges July 1, 2022
  • Societe Generale – FORGE selects METACO to manage blockchain asset capabilities – CryptoNinjas July 1, 2022
  • BnkToTheFuture unveils 3 proposals to rescue Celsius from oblivion July 1, 2022
  • EU agrees on MiCA regulation to crack down on crypto and stablecoins July 1, 2022
  • Kalima – A new way to collect, protect and monetize data using Blockchain for IoT – CryptoNinjas July 1, 2022
  • FTX Abandoned Discussions to Celsius Network Acquisition – Report – Blockchain.News July 1, 2022
  • Xinghuo BIF and Zetrix Jointly Introduce Web3 Services: Blockchain Identity/Verifiable Credentials and Contract Signing – GlobeNewswire July 1, 2022
  • Rewards4Earth plans to roll out crypto rewards to 1000 sports clubs in Australia July 1, 2022
  • Klever goes live with Mainnet of its native blockchain – FinanceFeeds July 1, 2022
  • CoinAgenda Announces First Round of Speakers for Ninth Annual Las Vegas and Sixth Annual Puerto Rico Web3, Blockchain and Crypto Conferences – GlobeNewswire June 30, 2022
  • Blockchain.com Cooperating With Investigations Into Three Arrows – Bloomberg June 30, 2022

Ad

Ad

©2022 o3n [ozone] blockchain layer | WordPress Theme by Superbthemes.com