Kik spurns Canadian investors for ICO
CEO blames OSC regulators’ ‘weak guidance’ on the risky, new investment method
Kik Interactive Inc., a Canadian messaging app preparing to hold one of the highest-profile initial coin offerings (ICO) yet, said it won’t allow investors from its home country to participate in the offering.
Chief executive officer Ted Livingston blamed “weak guidance” from the Ontario Securities Commission for the decision.
“They have failed to give us clear direction on when Canadian securities law will or, more importantly, will not apply,” Livingston said in a blog post.
“To avoid risks arising from this uncertainty, we, a Canadian compa- ny, have decided to move forward without Canada.”
Regulators around the world have expressed concerns with ICOs. In Kik’s case, it plans to sell tokens that can be used to buy services on its platform. The idea is that as more people use Kik, the value of their tokens will rise.
The Canadian Securities Administrators said in August it would decide whether an ICO should be considered an offering of securities on a case-by-case basis.
The move could count as a strike against Canada’s efforts — spearheaded by Prime Minister Justin Trudeau — to style itself as a haven for young, innovative tech companies. Still, ICOs are generally seen as a risky new form of fundraising, especially by Canada’s traditionally conservative financial establishment.