Kik, the first mainstream company to complete an initial coin offering (ICO) on ethereum, is reportedly considering whether it might migrate its token network to a new blockchain.
The social messaging platform, which raised $98 million in its token sale earlier this year, first broached the subject late last month on the Kin Foundation’s Telegram tech channel. There, Kik’s head of blockchain engineering and security, Leonid Beder, said the firm was interested in “kin” token buyers’ views on possible alternative blockchains that could replace ethereum.
“Since we first and foremost want the Kin ecosystem to scale to many participants and huge transaction volumes sooner rather than later, we realize that ethereum might not be the right solution,” Beder said at the time.
In statements to CoinDesk, Kik representatives cautioned that “nothing [is] confirmed” in regards to the potential move, but that the company is indeed exploring the idea of how such a transition might be executed.
A spokesperson said:
“We’re exploring our options as part of due diligence. If we did make this move, we’d ensure there’s a process in place to ensure all Kin holders have the new token for the correct amount.”
The move, while notable given Kik’s role in popularizing the ICO concept, is not unique for blockchain startups. For example, in the past, startups architecting token networks on top of the bitcoin network have migrated to other alternatives, most often ethereum.
If carried out, though, the decision could do much to impact the perception of ethereum – widely seen as the go-to blockchain on which to launch new tokens. At time of publication, nearly 13,000tokens have been issued via smart contracts on the ethereum blockchain.
According to those involved, one of the chief reasons for the exploration are the costs inherent in using the ethereum platform, as well as Kik’s specific goals for its token.
Early applications for the kin token are likely to monetize what people already do on Kik for free. For example, artists currently create stickers that users can send with messages on the Kik platform. With kin, artists might then be able to exchange stickers for value.
At press time, the median cost of transaction fees on ethereum is $0.14, according to BitInfoCharts.
And while ethereum developers have discussed technical solutions that execute transactions off-chain to scale the protocol and lower transactions fees, those have yet to go live.
In his Telegram message, Beder wrote that neither networks like Raiden nor alternative blockchains like EOS are ready for kin, but he added, “Stellar is indeed one of the directions we’re investigating.”
The kin ICO attracted 10,026 people who invested 168,732 ether in the sale.