Kik Interactive today announced plans to launch a new cryptocurrency, called Kin. Once it’s up and running, each Kik user will get a Kin wallet and opportunities to earn Kin for being part of the community. The currency can be exchanged for products, goods, and services within the chat app and any others that adopt the currency.
The move appears to be an attempt to monetize Kik’s young user base. Roughly 30 percent of Kik users are teenagers, and now minors ages 13-17 will be able to collect Kin currency, along with the rest of Kik’s users.
Today, you can make a purchase within a bot by entering credit card information through a webview. This allows you to do things like order clothes from H&M or Aerie bras, but no form of payment has been possible directly within the Kik app.
Kin, which will be created using an ERC20 token on the Ethereum blockchain, will act as the primary form of currency for transactions on the Kik platform.
In an interview with VentureBeat last month, CEO Ted Livingston stressed the need for bot platforms to provide payment methods and address monetization and scale for the developers and businesses making bots. But payments have presented a problem for platforms like Kik, whose teen users may lack access to more traditional payment methods like credit cards.
Kik is making its pivot now, says company CMO Erin Clift, because chat apps and their bot platforms are able to deliver a wide range of goods and services, but too much control in the hands of a small few can stifle innovation. “You sort of see that when you look across messaging apps or mobile apps in general. They’re all starting to adopt the same features, the same monetization formats, and we think that’s probably not the right thing for consumers, developers, creators, or brands,” Clift told VentureBeat in a phone interview.
“We believe an open, self-governing, and decentralized model could be the most sustainable, and what we think is the best path forward,” Clift said. “We think this is a better way forward from a consumer perspective because the more innovation that happens in the creation of content and the experiences and applications and services, the more delightful experiences consumers can have as these digital services become a more important part of their daily life.”
No news was announced today about when Kik will adopt traditional digital payment methods, such as debit or credit cards or payment services like Stripe or PayPal.
The swing to cryptocurrency is coinciding with what appears to be slowing growth on the Kik platform.
Teen usage, in particular, is down from 40 percent last year to 30 percent today.
“Over the past couple years we’ve sort of narrowed our focus into a more niche audience, which is a teen-focused audience specific to the U.S., so that’s where we are today,” Clift said.
Since last June, Kik has reported having 300 million registered users, a number it cited publicly as recently last month. The company declined to share current total registered user activity with VentureBeat, however, explaining that it now measures activity by monthly active users. Monthly active users is a key metric many bot and app users follow, while total registered users can obscure how many of those users actually use the app or whether they’ve churned out.
Kik currently has about 50 million monthly active users.
Kin will be integrated into the Kik platform this summer or later this year following a token distribution event and the sale of 10 percent of Kin reserves. Early adopters who also plan to use the Kin currency will be announced in the coming weeks, a Kik spokesperson said.
Additional early partners and users of the cryptocurrency will be announced in the coming month. Once Kin is integrated into the platform, its users will be able to earn Kin for participation in the Kik community.
The first order of business will be to create an economy inside Kik to help establish some fundamental demand and value for the Kin cryptocurrency before it’s spread to bots, apps, or others willing to offer Kin as a payment method.
Kik will provide Kin wallets for each user account to track withdrawals, deposits, and transaction history. Parents who want to turn off their kids’ Kin wallets will be given an option to do so after the token distribution event, a Kik spokesperson told VentureBeat.
To oversee the cryptocurrency — both its administrative core tasks and its growth — Kik also announced today the creation of the Kin Foundation.