ICO Overview, Kin (KIN)

1 SEPTEMBER 2017 - KIN (KIN)- DIGITAL DECENTRALIZED ECOSYSTEM - ICO

What is this? https://steemit.com/research/@juanplemus/research-summary
Most of the information below is either copied or paraphrased from official Kin documents and serves as a personal reference so that we don’t have to re-read the entire whitepaper when forming future opinions on the state of Kin.

Proposition: Kin is the cryptocurrency that Kik will use toward creating the first open and sustainable alternative ecosystem of digital services for people's daily lives. Economic incentives at the core of this ecosystem will ensure that all participants (users, founders, and digital service partners) will ultimately benefit from this work.

Basics: Promoted by the Kik messaging app, the decentralized Kin Ecosystem aims to become a sustainable autonomous economy that can empower the existing suite of chat, social, and other digital services, while building a platform for the best user experiences. It seeks to establish a global network of digital services, focused on the long term. Developers and service providers will enjoy the right and opportunity to innovate and compete for compensation, while users will benefit from a diverse digital experience, freedom of choice, and access to a broad range of commercial services. Kik will encourage a network effect for Kin by becoming its first large adopter and sponsor. It will also establish the Kin Foundation as the custodian of the Kin Ecosystem. Over time, the Kin Foundation will oversee the transition of the Kin Ecosystem to a fully decentralized model that can operate with no assistance from Kik or any other entity.

Functionality: At the heart of the Kin Ecosystem will be the KIN token, which is envisioned as a general purpose cryptocurrency for use in everyday digital services such as chat, social media, and payments. Kin will be the unit of account for all economic transactions within the Kin Ecosystem, and it will serve as the basis of interoperability with other digital services.

Value: Kin, an ERC20 token compatible with the existing infrastructure of Ethereum, is a pure cryptocurrency of fixed supply. It is fractionally divisible and long-term non-inflationary. 60% of the total supply of Kin will be secured in a smart contract, allocated to the Kin Rewards Engine. Every year, 20% of the remaining rewards allocation will be issued as periodic incentive payments, diminishing over time as the currency gains overall value. It will be distributed among ecosystem partners, favoring digital services in which the Kin cryptocurrency is highly utilized. Kik will introduce a number of marketplace use cases that will prompt consumers and brands to transact with Kin. Bots or content creators will create unique experiences and users will consume these products or services. The goal of the Rewards Engine is to create incentives for digital services and applications that create vibrant services within the Kin Ecosystem. The whitepaper states that 1 trillion, of 10 trillion total tokens, will be distributed in the ICO sale and will constitute the entirety of the initial liquid assets. Another 3 trillion Kin will be preallocated to Kik as the founding member of the Kin Foundation and subject to a long-term vesting schedule. In exchange, Kik will provide startup resources, technology, and a covenant to integrate with the Kin cryptocurrency and brand.

Innovation: Through the use of Kin, the Kik messaging app will permit users to transact value that is not restricted to use in one app, but connected to the broader cryptocurrency marketplace. Initial use cases the team envision are: VIP groups, premium user-generated content, shoutout messages, tipping, bot monetization and brand missions. The complexity of cryptocurrency technology is typically onerous for most consumers. Issues of transaction fees, private keys, and alphanumeric addresses create usability barriers for mainstream users. Kik will aim to significantly reduce these onboarding frictions as this process for users will not require prior expertise with cryptocurrencies before interacting with Kin. Kik will integrate wallets to support Kik’s millions of active users, and the team sees the potential for the Kin wallet to become the world’s most adopted and utilized cryptocurrency wallet. Kik will initially implement a semi-centralized hybrid on-chain and off-chain transaction service for scalable interactions with the Kin cryptocurrency. Users interacting with Kin inside Kik will have a managed experience with feeless transactions, faster transaction times, and encapsulation of complex features like private keys. The public Ethereum network, will serve as the currency’s decentralized settlement layer.

Team: There are two aspects when considering the Kin team. First, Kik has a proven track record as a successful messaging app and having experimented with their own form of currency with Kik points. As such integrating Kin with Kik looks like a manageable goal. The second step, setting up the Kin Foundation will provide more of a challenge. This includes the open governance of its resources together with other ecosystem partners; the support and advancement of the technology related to Kin’s implementation; and all matters related to ecosystem membership, including the Kin Rewards Engine.

Affinity: The “user first” approach to communications platforms that Kik is touting by incentivizing an open market and rewards through the use of cryptocurrency is very appealing to us.

First take: Messaging app that has over 15 million users plans to integrate an ERC20 token, sign us up!

Opportunity: Our main concern with the Kin ICO is the allocation of tokens. ICO participants will have access to 10% of the total supply, with Kik accounting for 30% and the remaining 60% allocated to the Kin Rewards Engine under the supervision of the Kin Foundation. The inflation schedule for the first ten years is as follows:

Kik will also be in charge of The Kin Foundation, which according to the whitepaper, will focus on delivering; (1) a transaction service that will enable centralized digital services to utilize Kin at scale, (2) an implementation of the Kin Rewards Engine, (3) a decentralized identity service for users of Kin. This entrusts Kik with an overwhelming amount of power over the value of Kin. To appease fears of being disingenuous in their intent to promote an open ecosystem they state that they envision the Kin Foundation’s governance system to evolve into a more decentralized model such as a DAO. They are pledging all of Kik’s resources to make Kin the primary transaction currency in its chat app and promote services from the Kin Ecosystem to its millions of users. They will incrementally transition to open source for the majority of their currently proprietary codebase, and envision Kik as one of many participants in the Kin Ecosystem rather than a landlord.

The risk of the Kik team not delivering on their promises is always there, but the main issue when investing in Kin can be summarized: is the price of each of the 1 trillion Kin, which constitutes only 10% of the total supply, low enough to justify participating in the ICO.

This is an opinion and we may have missed some very important information that can alter this overview of Kin. I'll gladly engage in discourse that can provide different viewpoints on the value of KIN. Please visit their site at https://kin.kik.com/ and https://www.kik.com/

If you plan to invest on this ICO do not take this as financial advice. It is important you do your own research before committing any money in any investment.