The U.S. Securities and Exchange Commission (SEC) believes that any cryptocurrency initial coin offering (ICO) is an attempt to offer the sale of unregistered securities. It has already spoken up on the subject on numerous occasions, holding several companies accountable for their actions.
The SEC is in the process of going after Telegram over what it deems an unregistered securities sale, and has a separate action in place against social media company Kik for the same reason. Kik, which sold the Kin token through an ICO, is ready to defend itself as far as it can go, and wants its case to be heard in court as soon as possible.
According to a filing by the SEC from last week, things could start to come together in a court of law later this month. The commission states, “Kik requests that the Court set a trial date. The SEC takes no position on whether setting a trial date would be helpful at this stage and submits that the matter can and should be resolved by dispositive motion,” and would have all depositions completed before the end of this month.
From there, by the end of next month, the SEC and Kik would exchange reports so that the two entities can perform their due diligence. In a little more than three weeks after that, rebuttals would be filed, giving the two another month to complete their discovery processes.
If the timeline stays intact, May 8 could bring motions for a summary judgment and requests for certain pieces of evidence to be excluded. Oppositions would then need to be filed by June 3, with replies to those oppositions required by June 19.
As with other, similar cases, Kik has had a difficult time convincing relative entities that it didn’t hold an unregistered securities sale with its ICO, which attracted around $100 million. It has tried to assert that the SEC doesn’t provide a clear definition of a security, using this as a reason to have the lawsuit thrown out. However, the courts have disagreed with that argument, and Kik still plugs away at building a legal defense to challenge the mammoth financial regulator.
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