Back in 2017, messenger app Kik raised $100 million in an initial coin offering (ICO). The U.S. SEC believes the company issued unregistered security. Following Kik’s submission of a Wells Response last December, the SEC is almost out of time to decide whether to pursue an enforcement action against the company, a16z writes.
Kik explained the cryptocurrency had been created to integrate it with the platform. It also pointed out its good “good faith compliance efforts,” including KYC/AML and OFAC screening as well as paying taxes on token sale revenues. Kik argued currencies are not securities under existing law.