Despite the service having millions of active users around the globe, Kik Messenger shuts down.
The firm said the messaging service was being shut down so it could focus on the Kin cryptocurrency that it also created.
Kik Interactive said in a blog that a legal dispute with the U.S. Securities and Exchange Commission (SEC) over Kin had compelled the decision on it. The choice also implies letting go of 80 employees who maintain Kik running. No date was provided for the closure of the Kik app.
Kik Messenger introduced in 2010 and was widely popular as it allows individuals to register and use it without offering a phone number or other credentials. The app also proved controversial, and a 2018 BBC News inquiry indicated that it had been featured in the previous five years in 1,100 UK child sexual abuse cases investigated by police.
Kik replied that it was “continually evaluating and improving its confidence and security measures.”
Writing about its choice to change focus, Kik Interactive founder Ted Livingstone said the firm had made the “difficult choice” to shut down Kik because it wished to devote all its attention to the Kin cryptocurrency.
By shutting down Kik and shrinking to 19 employees, the company could cut its overheads by 85 percent, he said, giving it a much better chance of winning the legal battle with the SEC. He acknowledged the difficulty the decision would cause as it would mean laying off people who had families and who had “poured their hearts and souls into Kik and Kin for over a decade.”
The legal row blew up because the SEC wished to categorize the Kin crypto-cash launch in the same manner as the original inventory offer for businesses floating on the stock exchange. It said it had effectively conducted an “unregistered” stock offering of $100 m (£ 80 m) when Kik Interactive launched Kin.
Mr Livingstone said it had to resist the classification of Kin as “safety” because it would “kill” its usability and that of other similar crypto-cash systems. “We decided to move forward and fight,” he said.
Kik Interactive would also work, as well as fighting in court, to convert the millions of existing Kin users into more active customers and buyers, Mr Livingstone said. Kin currently had two million “active monthly earners” and six hundred thousand “active monthly spenders.” And considerably increasing the community of Kin customers would make it much more difficult for the SEC to prevail.
“We’re going to win together,” Mr Living added.
Article originally featured by BBC.