During the peak of business the messaging application of Kik had millions of users which helped the company to get a market evaluation of about $1 billion and made it one of the tech unicorns. Recently, Kik announced that it is shutting the chat application as it has got into dispute with regulators.
Back on Monday one of the spokesperson of Kik Interactive made an announcement that the company is shutting its messaging application. Moreover, it will cut down the staff number drastically, from 100 to 19 employees. It was also announced that Kik’s main focus will be on to grow cryptocurrency, recently a lawsuit was also filed by Securities and Exchange Commission.
In the month of June Kik was sued by SEC as it raised near around $100 million with the help of Initial Coin Offering and didn’t registered for the activity in a proper manner. On Monday, the founder and CEO of Kik stated that the company has been drained due to the legal battle which it had to fight with SEC.
After the launch in 2010, the company attracted many users as it offers them a chance to chat while being anonymous. To use the application of Kik users do not have to register officially. Back in 2015, Kik got funding of $50 million from Tencent which is a tech company in China.
Various other messaging applications were developed by it, including Facebook Messenger, Telegram, WhatsApp and Line. Being anonymous created great deal of problems for the application as minors were contacted by child predators with the help of this application and even law enforcement can’t track criminals.
As per the data, there were 300 million users who were using Kik till 2016. Since the last 2 years SEC is trying to crack the ICO. The chairman of SEC stated that companies which are offering ICO are being targeted by SEC. Jay Clayton further stated that most of the ICO’s are conducted illegally and companies have started to raise great deal of money with it.