Social messaging app Kik has just announced that the company is planning to make use of two different blockchains in order to power its “kin” tokens. Last year in September, the company managed to raise $98 million through an Initial Coin Offering (ICO) by launching the kin tokens on the Ethereum platform. Later in December, it announced that the company is looking ways to switch from Ethereum to Stellar network sighting issues of speed, reliability and costs.
Now, the Kin Ecosystem Foundation which is a nonprofit and independent governance body for Kin said that it will be using the Stellar blockchain platform to improve Kin’s accessibility and functionality for digital services. The Ethereum blockchain platform, on which the tokens were initially launched will be used for liquidity white Stellar will be used for transaction purpose.
Ted Livingston, CEO of Kik, the popular chat app and the first member of the Kin Ecosystem, said: “The goal of Kin is to create digital sharing economy where everyone is fairly compensated for the unique value they contribute. While Ethereum provides immediate liquidity for Kin holders, it’s not ready for mainstream consumer usage.”
The implementation of Stellar within Kin’s infrastructure will take place in two phases. In the first phase, Stellar-based kin tokens will be created separately as different assets from the original ERC-20 tokens. The newly created tokens can be used by users and also spend them on other digital services within the Kin Ecosystem. These tokens will then merge with their ERC-20 counterpart thereby creating a unified currency over two networks.
As the kin tokens will be used on both the blockchains, the company will be using atomic swaps, which is a new technology currently under development that facilitates cross-blockchain transactions. This is like considering the kin token to be split in two parts where the company will be locking the token’s Stellar half as soon as its ERC-20 half leaves the app, and vice versa. Livingston said: “Creating a bi-directional blockchain with Stellar will drive mass adoption of Kin by providing faster confirmation times, low transaction fees, and scalability that digital services in the ecosystem require.”
Jed McCaleb, co-founder of the Stellar Development Foundation supported Livingston’s comments by saying, “There are several barriers to entry that prevent the average consumer from using cryptocurrency in their digital lives. Kin simplifies blockchain for mainstream consumers and digital service providers, and we’re excited to work together to drive mainstream adoption of cryptocurrency through scalable, fast and low-cost transactions on Stellar.”
Currently. Kik users can ear and spend kin tokens with the latter facility available only to buy sticker packs of digital art that people can use in their chats. However, Kik aims to provide more digital services and has assured that much more physical content will be made available to users on its platform. The digital service could include games, private chats of collectibles like Cryptokitties.
While on the physical part, manufactures of physical goods will be integrated on its platform who will be accepting payments in kin tokens.