Kin Foundation Publishes First Transparency Report Amid SEC Court Fight
The Kin Foundation is offering a peek under the hood.
The group published a transparency report Thursday, laying out its structure and operations, in a partnership with Messari and its disclosure database.
According to the report, the Kin Foundation plans its budget a year in advance, with funds going to app developers, node incentives, user grants and marketing and operations. There are 1.45 trillion kin tokens currently circulating, out of 10 trillion created in all.
The foundation is currently run by a board of directors that consists of two members: Kik Interactive CEO Ted Livingston and William Mougayar, author of “The Business Blockchain” and one of the founders of the Token Summit annual conference. Kik created kin in 2017.
“The Board of Directors is appointed annually by the members,” the report said. There is also a Kin Representative, which the report says acts as “a conduit between the Kin Foundation and the community of developers and holders.”
Read more: Judge Approved Blockchain Association’s Brief in Kik Case Despite SEC Objections
Matt Hannam, who took the post last month, is the only representative at present, but the foundation plans to add another two or three over the next year. Kin also has an “informal” community of 10 delegates who oversee kin rewards and disagreements.
The foundation’s tokens are vested at a rate of 20% per year, though the report noted that the first year is only a partial year (kin was created midway through 2017).
The report claims that more than 28 million users have acquired kin in the last three years, using more than 50 different active apps. Active apps are defined as those with at least one user spending kin in the past 30 days.
According to the report, nearly 300 million kin were spent per day earlier this year.
Legal fightThe report comes amid Kik’s ongoing legal fight with the U.S. Securities and Exchange Commission (SEC), which sued the company last year on allegations the kin token sale was an unregistered securities offering.
Earlier this month, both parties filed their reply memos as part of the motions for summary judgement each party sought.
For its part, the SEC says Kik’s marketing of the kin token would have led purchasers to expect a profit, highlighting various online posts and a roadshow the company underwent.
In a statement, Kik General Counsel Eileen Lyon said, “Our take on the SEC’s opposition is that it relies heavily on the recent Telegram case, which we think was poorly reasoned and wrongly decided,” referring to the granting of a preliminary injunction against Telegram.
Read more: With Kik and Telegram Cases, the SEC Tries to Kill the SAFT
The Telegram case decision “is not binding precedent,” she said, “so it will be interesting to see what impact it might have, in light of the many other authorities we have cited and the significant factual differences in the two token offerings.”
Kik also felt that the SEC’s arguments about the “integration” issue “were conclusory and circular,” she said.
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