Live Q&A #2 with Ted Livingston, Kik Founder and CEO


Alright welcome everybody to the
monthly Kin question period so just
quick recap the purpose of this is once
a month I like to get on a live
video YouTube and take questions
directly from the community.
This is something we’ve been doing for a
long time at Kik now and people really
value it. So just to recap the way this works is
go on to Reddit ask any question in the
comments and then whatever gets upvoted
to the top I will answer as long as it
passes three tests.
So first of all it has to be on topic. Second it has to be constructive and then finally third it
can’t be about an individual person or
entity. So just for going forward we’re
gonna do these AMAs on a monthly basis
so we’ll do these on the second Tuesday
of each month at 2:00 p.m. Eastern and
we’ll open up the questions at least two
hours ahead of time. So with that we’ll
go for about half an hour and we’ll see
what questions we have today.
Okay, Dylan of course at the top.
Alright are the prospective partners satisfied
with the liquidity that is currently
available for Kin tokens? What processes
are you recommending for ecosystem
services to off-ramp their earned Kin
into dollars if they have to move from
Kin to a native asset and then move to
dollars? Wouldn’t that double tax the
accounting burden? Dylan you have good
questions you got a lot of questions.
So maybe let me take those one at a time so
the first one is that liquidity is
obviously really important when we talk
to partners of digital apps of small all
the way to huge companies we sort of get
a resounding excitement about Kin. You
know I think everybody has been sort of
fighting this fight against these
digital monopolies of Facebook and
Google and just struggling to do so and
this idea now that “Hey there’s a new way
to monetize that’s going to turn you
into sustainable business but not on
it will actually make your app better
for your consumers and it will align you
with your consumers,” gets people really excited.
And so as we work through that
there was a bunch of questions around
regulatory and tax and incentives and
how all these different pieces will work.
When it comes to liquidity that is
definitely a big question.
Okay I get all this Kin but at the end of the day I want to be able to take some of this Kin,
monetize that and use that to fund
my operations and as a reward for
building out this ecosystem and so for
this whole thing to work for this
ecosystem to work there needs to be a
lot of liquidity and so getting on major
exchanges is something that we’re
focused on that we need in order for Kin
to be successful.
Now to answer Dylan, your second
question – three questions. Next
time I’m only going to take the first one.
To answer your second question, a
question potential partners have after
this is “Okay I get all of this Kin.
Let’s say there is lots of liquidity but
I’m not used to managing these crypto
assets. What do I do?”
And so that’s part of the the platform,
the ecosystem we’re building out is
getting partners in place not just to
build these digital services but also to
build all those complementary pieces
that make the whole ecosystem work and
one of those is exchanges for
developers. So making it really easy for
them not necessarily to have to manage
their own cryptocurrency their own Kin
that they get from the reward engine but
also the option to have somebody manage
it for them and to make that really easy
for them. And then finally on the tax side,
tax is something we’ve spent a lot
of time looking at, a lot of time working on.
We’re sort of you know people from
KPMG from all over the world
contributing to how we can make the tax
side of this work for developers
for individuals and so I don’t have the
exact answer to the double taxing but
it’s definitely something we’re paying
attention to and making sure we’re doing
in a tax efficient way.
Okay, let’s refresh here.
I see, “Dylan, Dylan, Dylan.” Dylan I have to say every time when I see that there’s a thread from you
on Reddit I’m like this is gonna
be good so I’m not surprised.
If Kin is running in both Ethereum and Stellar, how will you prevent this from being a
user experience nightmare for those that
don’t know the difference? Will all Kin
entering the ecosystem be converted to
Stellar Kin?
So I think this is something.
that got us really excited is ,”Hey we
like Ethereum for all these reasons but
not these reasons, on the other side we like Stellar for sort of the
opposite reasons but we don’t like it
for other reasons as well. And I think
while we were originally thinking, “Hey we
had to be on one or the other,” we’ve come
to the conclusion that not only is it
possible but it would also be best if we
could be on both. If Kin as a token can
move across blockchains, move across
both Ethereum and Stellar. And the reason
for that is these two blockchains
target a different use case.
When you look at Ethereum,
what it’s really good for is it’s really
plugged into the crypto-investor market.
You know it’s exchanges all know how to
implement any ERC20 token, wallets –
hardware wallets that whole ecosystem
and infrastructure around tokens for
crypto investors is already built out
and very mature. But what Ethereum’s not
great at is high scale transactions with
low fees and low confirmation times and
that’s something that Stellar is good at.
You know Stellar we can do way more
transactions, way faster confirmation
times and way several orders of
magnitude lower transaction fees but
Stellar is not plugged into exchanges
it’s not plugged into wallets or
hardware wallets, it’s missing all these
other pieces and so what we decided to
do is we said, “Wait so Ethereum could be
great for investors,
whereas Kin could be great for the
average consumer. How could we use both
in a very simple way?” And I think one of
the big insights we had is these two
groups while there’s some investors who
also consumers and while there’s some
consumers are also investors,
by and large we can keep these running in sort of these two different networks and
support each better by combining these
two systems. So how we make this really
simple is, for the most part the
digital services that millions of
consumers are going to be interacting
with Kin on a daily basis in their
digital lives, earning it and spending
at these small amounts inside all these
different digital services that will
happen on top of Stellar so they’re
getting really high scale, really low
confirmation times and we the ecosystem
are getting really low fees so it’s
working really well for them. But at the
same time if those consumers, if you know
you get maybe one percent of them are
earning more, they could then always take
that and move it over to the Ethereum
blockchain, put it in hardware wallets,
put it on exchanges and vice versa.
A consumer could say wait a second I’m
using all this Kin inside all these
digital services instead of just earning
it and how could I buy more and so what
they’ll be able to do is they’ll be able
to go into Ethereum onto the exchanges,
by a bunch of Kin on Ethereum, and then
move that onto the Stellar board.
In this way we think we can use – combine the best of each blockchain
while getting rid of the disadvantages.
Okay.
Have you been in contact with the App
Store in the Google Play Store to make
sure Kin earning & spending will be allowed without
in-app purchase fees? Have any of the
applications received advanced approval
or will that just be determined when
they’re ready to release?
This is something we’ve been dealing with at Kik since we started nine years ago now
Building these applications,
putting them into the Apple App Store
putting them into the Google Play Store,
getting them reviewed, keeping them
on sign, etc. And so when it comes to a
cryptocurrency
inside of an app particularly on the
Apple platform there is a question mark
there because you can look at it in one
way and you say well this is sort of
like in-app purchase I’m using a
cryptocurrency to unlock a feature set
“Hey I want to get into this group chat
and I have to pay with Kin.”
Historically that would be something
that you had to pay with in-app purchase
but there’s a place that in-app purchase
doesn’t work for this digital sharing
economy we’re trying to build and
there’s two reasons. The first is that
the amounts are much smaller so now the
idea like if you want to get into a
group chat you have to pay a minimum of
$0.99 doesn’t make sense. People want to
pay 9 cents or .9 cents or .09 cents so we need
something that can go to much smaller
denominations and the second reason it
doesn’t work is because it’s not just
something we want consumers spending but
it’s more so something we want them
earning so it’s not just on one side
“Hey I want to spend .9
cents to get into that group chat,” but
it’s also, “I want to on the other side
earn that .9 cents when I charge
somebody to get into my group chat.” We
want it to be this medium of exchange in
this digital sharing economy where
people are both earning and spending in
these small amounts and so for these two
reasons in-app purchase doesn’t work.
Now, what does Apple think about that. We’re
having conversations with Apple about
this and the punchline I would say is, it’s early and we don’t know
But when I think about Apple and I think
about what they are known for I can’t
see anything that’s better for them than
something like Kin because with Apple
they’ve always been champions of the
rights of consumers
they’ve always been champions of the
rights of developers and they compete
with big companies, their biggest rivals
who do not champion the rights of those
two things. When you buy an Apple product
you are their user. You know they
say, “Hey let’s build a really good phone
and if we make it good enough then
people will buy it.” So the incentives of
what they’re trying to do are completely
aligned with what their consumers
are trying to get.
I want to build a great phone for you and I want to buy a
great phone from you.
Whereas when you look at Facebook and Google that’s no longer true. Facebook and Google are
trying to accumulate the attention of
consumers so that they can then extract
as much value from those consumers as
possible. “Hey come to Facebook we’re
gonna addict you as much as we possibly
can,
to show you as many ads
as we possibly can to get you to buy as much
stuff that you might not need as much as
we possibly can. So on something like
Facebook the consumer is not the target
audience, the consumer is actually the
product. They are misaligned with
their consumers. They aren’t trying to give
value to a consumer. They aren’t trying to
build something that’s amazing for their
lives. They’re trying to addict them more
so they can put more ads in front of
them so that they can get people to buy
more stuff so that they can make more
money. When you think about Apple
you’re saying, “Apple you are aligned with
your consumers, that’s your thing.”
Whereas Facebook and Google are not. So by adopting something like Kin, by allowing
something like Kin, by supporting
something like Kin, you are saying,
“Hey consumers we believe in your rights. We want to be aligned with you. Our goal is
no longer to extract value from you but
is to facilitate the exchange of value
between you.” And that I
think is just so fundamentally
different but there’s something more. By
adopting something like Kin, Apple can
also champion the rights of developers.
When you look at the most downloaded
apps in the Apple App Store last year,
all four of the four most
downloaded apps in the Apple App Store
as I read it, were all Facebook
properties. Facebook, Facebook Messenger, Instagram and Whatsapp. Facebook owns
Apple’s App Store and the way they do
that is by first giving themselves an
unfair advantage by choosing a
monetization model that gives them way
more ability to monetize versus anybody
else. They might only have a hundred
times more users than Kik but they make
way more than a hundred times more money.
But then Facebook turns around and they
use this to copy and crush their rivals.
They say, “Hey little developer. Great idea
but we know that you don’t have the
scale to monetize effectively so we are
going to turn around and copy and crush
you and they’ll even go so far as to
bankroll some of their other properties
to achieve this. So for example with
Snapchat – great product idea let’s do
Snapchat Stories. Instagram not only
comes out and says, “hey we’re gonna copy
this pixel for pixel and we’re super
open about it hey we thought it’s great
probably copied it why not why can’t we
do that.” Not only did they do that
but then when it came to monetization
and putting ads into stories, Instagram
said “you know what we’re
gonna wait to put ads into stories,” and
Snapchat saying “what do mean you’re
gonna wait like how are you gonna make
money?” “Oh we’re gonna make money from somewhere else. How are you guys gonna
make money?” “Well we only have one choice, we have to put ads in stories. That’s our
only revenue model.” Instagram goes “well
yeah that sucks like better put in some
ads and see how your users respond.” And
they can wait.
Snapchat puts ads in their stories, their
users get upset. Instagram lets that go
for a while and then Instagram a few
weeks later once everybody’s pissed at
Snapchat says, “Hey we’re gonna add some
ads as well because yeah we also want to
make money but don’t worry we’re not
going to put in as many
as Snapchat. And so the second beautiful
thing that Apple can do is champion the
rights of developers. “Hey developers we
believe that you’re an innovative group
we believe you can deliver value to the
world but all the monetization models
you have available to you today aren’t
working. But good news we’ve partnered
with Kin and there’s a new monetization
model. One which is premised not on
extracting value from consumers but one which is premised on
facilitating the exchange of value
between consumers. Not only that the
way that the monetization model set up,
the way that the Kin Reward Engine is
set up is if you have ten times the
number of transactions then you get ten
times the number of reward unlike
advertising where if you have ten times
the number of users you get a hundred
times or a thousand times the amount of
revenue because of these network effects
around scale and advertising and so
that’s where when I think about Kin and
I think about Apple it just like comes
across as like such a natural fit to me
so exciting and this is what we talked
about this is what we say. It’s like you
champion the rights of users, you always
want to do what’s best for the user. Your
privacy first you don’t collect all this
data on your user,. You end-to-end encrypt
everything. Second you created this
developer market. You said to the world
“Hey we believe developers can be
innovative,” but fast-forward to today and
these monopolies have taken over your
App Store. Here’s a way with Kin to put
consumers back in control, to put
developers back into control, and to say
to your two biggest competitors
“Hey we don’t think that’s right. We don’t
think that’s fair.” And so we think Kin on
the Apple platform is a super exciting
thing.
Okay
Dylan, you got all the questions.
I’m going from top to bottom
those are the rules here. Let me just
make sure Evan answered this one. Ah,
non-Dylan question. “Last AMA you
discussed how important liquidity and
thus exchanges are for the success of
Kin. Since this AMA there has been no
further communication
on this topic. Could you please provide
an update on the status of this subject?”
Liquidity is the only thing that’s going
to make this ecosystem work. If we don’t
have liquidity by the time we launch the
Kin Reward Engine then what are all
these Kin developers going to do with
their Kin? How is it going to be a
sustainable business model for them? So
getting on these major exchanges is a
major focus for us but given the state
of the crypto market we need to both
respect the requests of these exchanges
to keep everything confidential and we
also need to go about this very
carefully so that we’re completely
onside from a regulation point of view.
So I don’t have any updates today but
what I’ll say is this is a high priority
for us because it’s required to make the
ecosystem work by the time we launch the
Kin Rewards Engine.
“How has the KRE plan been amended
since the RFC document and what aspects
remain undecided? For example was a
reputation model adopted? Why is Kin
interested in using centralized services,
VCs, to accredit startups for added
incentives rather than organic growth
models?” To credit startups I’m not sure
what that means so maybe let me back up
here for a second and try to do my best
to explain our current thinking on this.
When we look at Bitcoin, what we look at
it is not as an application, not as a
blockchain,
but as they decentralized incentive
platform and what I mean by that is
what they’re trying to do is they’re trying
to build a solution to a problem in this
case moving value around the Internet
but in order to do that they need people
from all around the world to contribute
and the genius of Bitcoin is how they
set that compensation up for those
contributions because what they
basically said is, “hey we’re creating
this new cryptocurrency called Bitcoin
once it’s created there will never be
more. If you help us run the
infrastructure you could get your own
Bitcoin and by the way there’ll be
demand for Bitcoin because it will be
the only way by spending Bitcoin to use
the application.” Okay cryptocurrency
where there will never be more, a way to
earn some of it by contributing, and then
a way to create demand for it in the
final solution. If you want to use the
final solution you have to use the
cryptocurrency. And so that’s what we’re
trying to do with the Kin Rewards Engine.
We said how could we take that idea, that
philosophy, that decentralized incentive
platform idea and apply it not at the
infrastructure level but at the
application level and so instead of, “hey
if you contribute to help us you know
run the infrastructure, we’ll pay you
Bitcoin,” it’s “if you help us contribute
to creating these amazing places to earn
and spend Kin, you’ll get Kin from
the reward engine. Now I think to the
question of what has changed in our
thinking, it’s the thing that’s evolved
is how we pay out this Kin. You know when
you look at Bitcoin the amount of reward
you get as a percentage of all Bitcoin
that exists goes like this, so it’s a lot
in the beginning and then it sort of tails
off over time until all 21 million
Bitcoins are in circulation. So with Kin
with the Kin Rewards Engine, we took a
similar thing. “Hey we’ll start with all
Kin and then you know over time
they will be less and less but hopefully
it will be worth more and more as the
ecosystem grows. I think the challenge of
that at the application layer is you
could have some developers who in the
beginning create a very simple application
and maybe it’s even spammy in a way
or its gaming and yet they’re getting
this huge chunk of Kin and so we sort of
step back from that and said, “okay well
maybe in the beginning instead of making it
algorithmic like Bitcoin it’s just an
algorithm that pays out the Bitcoin,
it’ll make it more subjective. We’ll say, “okay in
the beginning until we get this
algorithm sorted out, we
will decide who to give what Kin to
in the beginning to get this whole ecosystem going and then we’ll make it more
algorithmic overtime. I think there’s
actually an interesting option in
between where instead of paying at large
amounts in the beginning we actually
start with smaller amounts so that
instead of making them subjective, we
control them. “Hey no spammy app is
gonna get all this Kin right off the bat.”
Then we can still make it
algorithmic so instead of the payout
going like this over time perhaps the
payout could go like this over time so
it starts small so we can weed out ways
to spam it and game it and but still
have it be algorithmic then over time as
we get confident that this algorithm is working –
it’s robust, it’s hard to game, or to spam,
the payouts start to ramp up.
The ecosystem starts to grow and those payouts became more valuable so then as those
payouts are getting really valuable we can
then tail off the payouts because well
the percentage we’re paying out is going
down, the ecosystem is growing, and the
value of those payouts is going up. So I
think just how we pay this out has
evolved. I think we want to keep it like
Bitcoin where it’s a decentralized
incentive platform. You know if you want
to contribute to it, you don’t have to
talk to anybody, you don’t have to petition anybody, you don’t
have to like do all this business stuff
of trying to say, “hey you know if you do
this for me then we’ll do this for you
and maybe we’ll fall through and
maybe we won’t.
Instead we take all that logic and we
put it in a piece of code so that as a
developer no matter who I am, how big,
how small, no matter what country I’m in, I know the rules of the game and I
know those rules are guaranteed that if
I create this output then based on the
algorithm I will be rewarded this much
Kin based on a cryptocurrency there will
never be more and then based on the
software the platform that there will be
demand for it because it will be the
only way to transact
in this Kin ecosystem. So that’s really
our thinking and that’s some of the
evolution we’re going through but I
think the thing we’ve been focused on
sort of before all that is how we get to
the scale. You know none of this matters
until we have the scale and so that’s
really been our focus with Stellar and
with Kik is having a blockchain that
can get scale showing how it can be used
at scale with Kik and then bringing in
partners with the Kin Rewards Engine to
then take the ecosystem to the next
level.
Okay
“Will the standalone app be
available for everyone to download in
App Store or only for select users?
What will the initial amount of Kin given to
new users be?” Okay I think this is a good
one to end on. So the question we had
with Kin is, “okay we can make in really
easy to use inside Kik, that’s what we
did with Kik points, we know how to do
that.” But how do we make it really easy
for developers to use it and for their
users to use it? So for example from a
developer point of view that’s why we
call it the five-minute SDK. In five
minutes as a developer you should be
able to integrate the SDK and have it up
and running for all your users.
From there you can customize it, you can
create custom ways to earn, custom ways
to spend, to build more transaction
volume, to get more of the daily reward.
But out of the box it’s only going to
take you five minutes. But the other
thing we had to do is make it really
simple for their users. For example if
now as a user, I use Kin inside Kik but then I want to use Kin
inside of another app. Well how do we tie
those two accounts together?
When I use Kin in that second app do I
have to create a Kin account to have to
link that to my first account, like how
does that work?
How do we make that really
simple and easy so as a developer
we’re not saying, “hey add this whole new login flow and signup flow.” Instead like
just right away right of the box I can
start earning and spending even if I’ve
never heard of Kin before no matter what
app I’m in. And so the way we solved that
is we said, “okay let’s have individual
balances in each of the apps a consumer uses,
So in Kik I can earn and spend and I have one balance in a
second app I can earn and spend Kin
and I have a different separate balance
What this means is I can get it up and
running on day one there’s no account
creation. I can start earning and
spending inside Kik and there’s
nothing else to learn and more
importantly from the sort of sort of
security point of view, the Kin I earn
inside of Kik can’t be sort of taken by
that second app I’m using because
they’re separate balances. But as a user
you’re saying, “well okay that’s good I
can get up and running right away.” As a
developer I’m saying, “that’s good I can
get up and running right away,” but then
as I say user at some point you say, “well
I have 100 Kin inside Kik and I have a
100 Kin inside the second app and
there’s something I want to spend on in
that second app that cost me 150 Kin. How
do I get all my Kin into one place so I
can buy this bigger thing.” That’s where
the standalone app comes in. What the
standalone app does is says, “hey you’re a
user, you’re earning and spending Kin in
these different places. Wouldn’t you like
to consolidate your balance into a
single account and be able to manage
that balance in a sort of simple yet
secure way. so you can earn it now in all
these different places, you can spend in
all these different places but you have
one balance and it’s all very secure and
easy to use. That’s the role of the
standalone wallet; this cross app earning
and spending. So when we create the
standalone wallet what we’re doing is
we’re not saying, hey you know we’re
doing this whole Kin thing and it should
be decentralized and nobody should
control the ecosystem but you know
wouldn’t it be great if everybody had
this
one app and then that one app becomes
the control point. That one app, that Kin
stand-alone wallet becomes the
centralized place that can hold,
has all the relationships with the users
all the relationships with the
developers, can direct all the traffic
then. We’re right back to where we
started where now as a developer in the
ecosystem I got to trust this Kin
standalone wallet, so that’s not the
point. If that’s not the point what is?
The point of the standalone wallet is
merely, is to
play a very important role
serving as a prototype and an example of
an application that anyone should be
able to build. So that as a developer I’m
saying, “hey I don’t like the Kin
standalone wallet but look here’s all
the code I have, all the code for it is
right there. I’m gonna take it build my
own standalone wallet and put my own
tweak on it. Maybe it’s really tight
integration into an exchange, maybe it’s
better key recovery, who knows what it is,
But then I as a consumer can go out and
I have all my choices around which
wallet I want to use. It’s sort of like
the wallet becomes the browser. On the
browser you know that’s the way we sort
of access and manage all these different
websites we use. That’s what the
standalone wallet becomes as a way to
access and manage the Kin we earn and
spend in all these different applications.
But just like the browser
the wallet should be an open standard
and anybody should be able to build
their own wallet and anybody should be
able to choose which wallet they want to
use. So that’s the purpose of the
standalone wall is to serve as a
prototype, an example for for this sort
of key piece of the ecosystem that
ultimately we hope there’ll be many
different options for consumers to use.
Okay that’s it for this month I look
forward to seeing everybody the second
week of March and we’ll go for there and
thanks for tuning in and we’ll see you
soon
Thanks.

22 thoughts on “Live Q&A #2 with Ted Livingston, Kik Founder and CEO

  1. Very excited for this! Any way you extend the Q&A to an hour? You do a great job explaining how you guys are going about developing. Keep up the good work!

  2. Wow. A company that did an ICO has visible actual human beings doing LIVE q&a? Is this real life? Most ICO teams just disappear with your money.
    .
    .

  3. Thx Ted. In your last answer, you mentioned the ability for multiple developers to think about creating their own wallet to hold Kin. Is this something that you are/will be helping create public and documented standards around?

  4. The Fairx exchange will cover your concerns regarding Stellar once it launches, but keeping it as an ERC20 token doesn't hurt for now. https://fairx.io/

  5. Im excited and i hold kin , but i had to go to a scammy broker to get them and i dont even want to go back to them to buy more or sell a bit.. It would be great if Kin put some efforts in getting listed on binance, bittrex, kraken, gdax or other trusted exchanges. That would help kin a lot and would protect the community agannst scammy websites and exchanges,

    Hope to see the announcement soon!

    Thanks!

  6. i feel like releasing tokens for sale may have ruined the whole idea. wouldnt it make sense to release them only via the rewards engine instead? now kin is forever tied to fiat rather than letting kin develop its own value organically

  7. Dude your are wayyyyyy cool for doing this, and thanks so much for the transparency. Great discussion on facebook and google and there practices and hey man you were spot on all the way, Great job!!!! This weeks news about facebook proves your every word spoken about there views and primary focus. So many people trusted them and never suspected that they were being targeted. They've had huge stock market drops as a direct result. We all here truly appreciate the in-depth chat about kin and your vision there at kik. You guys are indeed on to something very special. Thanks!!

  8. you should make it so anyone on kik or any other app which uses kin for tokens of pay can then take any kin tokens that they may of gained or earned and then send it to a ledger nano s or paper wallet or any crypto wallet. that would get users who invest into cropto using kik and all other apps that use kin for tokens because they would use your app for farming kin coins šŸ˜‰

    you can thank me later lol and maybe hire me if you want more great ideas in how to gain more exposure and use of your kin token.

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