Welcome to the first in a series of tech FAQs where we post responses to the most frequently asked questions. We appreciate the support of the community and of everyone who sees the great potential of Kin. We are very excited to be able to engage with the community on a daily basis and to have the chance to talk with Kin holders from around the world!
And if you haven’t already done so, please join our community channels:
Reddit: https://www.reddit.com/r/KinFoundation/
Telegram: Kin Announcements: https://t.me/KinAnnouncements
Kin General: https://t.me/Kinfoundation
Kin Currency: https://t.me/Kincurrency
Kin Technology: https://t.me/Kintechnology
Github: https://github.com/kinfoundation/; KRE RFC: https://github.com/kinfoundation/kin-rfcs/blob/master/Kin-Rewards-Engine/Kin-Rewards-Engine.md)
If you have any suggestions for future blog posts, please make your suggestions in the Kin Foundation telegram group!
Kik related questions
Q: Do you think there is a need for 10 trillion kin?
A: Kin supply will be used to power the whole ecosystem — not just Kik. As mentioned in the whitepaper, our goal is to drive mainstream adoption of a cryptocurrency, and in order to do that, we need users to be able to transact in whole numbers, not fractions.
Q: Why does Ethereum even matter if most of Kin’s velocity is off-chain on Kik?
A: While we stated in the whitepaper that we will pursue a hybrid solution (off-chain/on-chain), we’re currently exploring how we go on-chain immediately.
Q: How will Kin maintain user wallets across many apps?
A: That’s a great question. This will be partially managed by the Kin SDK, which we’re working on at the moment. It will allow the various digital service developers to integrate Kin and identify users.
Q: When will people who bought Kin after the token distribution event (TDE) be able to link their ether wallets to the Kik app?
A: We’re working on it. We can’t commit to an exact date but most likely very soon after the alpha is rolled out in December.
Q: When will microtransactions be possible with Kin in Kik, and how will it be implemented in general?
A: We will rollout the first microtransactions before the year ends. At first, we will launch the alpha on the Ethereum network, which will be able to support the expected amount of transactions. In parallel we’re researching other blockchains should Ethereum not be able to hand our scale at a higher-throughput chain.
Q: How will the average Kik user liquidate their Kin?
A: We’re working through these solutions. We’re initially focused on starting marketplaces where users can earn and spend Kin. We know that a lot of people will be interested transferring Kin or converting it to fiat currency, and we’re working through solutions.
Q: Is there a particular business/industry best suited to benefit from Kin?
A: Any type of digital service where users can earn and spend. We list some examples in the whitepaper such as VIP groups, premium user-generated content, shoutout messages, tipping, bot monetization and brand mission.
Q: What, if any, solution have you guys created in regards to the amount of transactions that could potentially take place within Kik everyday?
A: This is a great question. Given the limitations with public blockchains, we’re taking a slow Gmail-style rollout that will be controlled so that the network doesn’t crash. In the beginning, we’re planning to start with an on-chain solution. We’ll publish everything openly, similar to how we published the KRE as an RFC.
Q: Will users be able to transact Kin from Kik’s internal wallet to exchanges in the future? Or only to other Kin wallets?
A: From a product perspective, we want the ecosystem to be as open as possible and to provide the most value to users. Features like trading Kin from a Kik internal wallet to an exchange inside of the app, or even buying Kin through in app purchase (IAP) fall under this category. We believe that certain users will want these features and limiting desired functionality is usually a bad idea. It is important to note though that external conditions may prevent us from providing some of these features. Transactions with exchanges may be regulated in different ways in different geographies as well as use of IAP.
Development Questions
Q: Is there a development timeline or a rough progress schedule?
A: Yes, we releasing the alpha before the end of the year. We are going to publish what exactly it will contain, the roadmap, and how we plan to achieve it very soon.
Q: Devs, will you be providing app documentation for DSDs (digital service developers) anytime soon?
A: Yes, but we can’t commit to when exactly.
Q: How many developers are working on Kin? How long has the KRE project been going? What has been developed (besides the whitepaper)? When will the issues submitted on github be addressed?
A: There are currently about 150 employees working at Kik. There is already a group of more than 30 employees that focus on Kin entirely. KRE research took months to accomplish, and you haven’t yet seen all of its technical documents.
As for the KRE, we actually completed its design a few months ago, but we sought feedback from our advisors and a few academics. Going forward, our intention is to be open from the start, drafting these documents together with the community even if ideas are only half-baked.
Q: I am a bit concerned as to what is exactly happening in terms of progressing Kin, it seems that after the big hype the creator of Kik, is nowhere to be seen.
A: Rest assured we are not standing still. Kin is an extremely complicated project as we’re dealing with both infrastructure challenges (Ethereum cannot scale to our needs) and product challenges (creating a crypto product designed for mainstream consumers). We currently have about 30 devs working full time on Kin and are shifting more teams to work on it. As you know training and hiring takes time, especially in crypto.
Q: Will you guys add a fiat to Kin option in the messenger? How would this exchange rate be determined? Would you provide the liquidity or could anyone using the messenger offer to trade (effectively creating an in-app exchange). What level of reserves would Kik dedicate to such an exchange?
A: Yes, most likely. First and foremost, we want to make sure you can earn and spend Kin inside of the app. We might consider ENS integration, and we’ll publish blog posts on our blockchain research.
Q: App and Bot Developers — If I do X or Y will I get rewarded?
A: The goal of the KRE is to be open to as many digital service developers as possible. Developers will be compensated based on their contribution to the Kin Ecosystem. Currently, this is measured by the volume of Kin transactions they facilitate. If you are a developer of a digital service that successfully facilitates Kin transactions, you will be rewarded. Bot developers are a special class because they don’t create a standalone digital service but operate within one.
For example, bot developers within Kik work within the Kik digital service. Every digital service is free to choose how to divide its reward with its own developers. The current plan within Kik is to give all rewards generated by a bot to that bot developer. So yes, if you are a bot developer within Kik that facilitates Kin transactions, you will be rewarded.
Q: Are we incentivizing the right things, and will it contribute to the growth of Kin?
A: We are doing our best to incentivize the right things that will contribute the most to the growth of Kin. Since it hasn’t been proven our current plans are indeed optimal, we are seeking feedback from the community regarding these plans. If you have an opinion regarding what should be incentivized, we encourage you to share it with us.
Currently, we are trying to incentivize adoption and usage of Kin by rewarding digital service developers in accordance to the volume of Kin transactions they facilitate between their users. We believe transaction volume is a good metric because it measures not only how many users actually use Kin, but to what degree. Since this metric can easily be gamed, we have mechanisms in place to guard against sybil attacks (in the form of the voting algorithm, see the RFC for details). Other suggestions for metrics to incentivize include the number of active Kin users. For example, we could define a user as active if they performed at least one Kin transaction in the last X number of days.
Blockchain Questions
Q: I see that earlier you have stated that you guys might move away from the Ethereum network. If this happens, how are you going to credit the owners of Kin today with the new network you plan to implement?
A: If this happens, every possible migration flow will make sure that your Kin balance(s) and history remains the same.
Q: If you move to another platform and are no longer on Ethereum, would you convert existing tokens to the new platform?
A: Of course. The infrastructure keeps on moving forward, so we may find ourselves replacing the infrastructure over time. We would never do that without migrating all balances!
Q: How is blockchain going to be integrated into Kik?
A: We will publish the technical study in the near future. Stay tuned. It’ll be also addressed in the roadmap.
Q: So you guys are developing your own blockchain?
A: We are currently researching other blockchain platforms that can meet our scale and needs.
Q: Why are you so quick to move from Ethereum? What happens during migration?
A: First and foremost, we want the Kin Ecosystem to scale to many participants and huge transaction volumes sooner rather than later. Ethereum might not be the right solution. This is why we are researching and investigating other models, including moving to different public blockchains. In any case, any future migrations, if at all, will be seamless and everyone’s balances will be preserved.
Q: Would the total supply be less on the new platform?
A: Whenever we migrate, it will always be full migration of all balances. The total supply would remain at 10 trillion tokens.
Q: What blockchains other than Ethereum are you contemplating?
A: Great question, I’ve just started working on a series of blog posts on that issue.
Ethereum can carry us to the 1000s of tx/day levels. Beyond that we need to migrate and we think no unpermissioned platform is good enough at this point. We are planning to migrate to one of the permissioned platforms (PBFT).
Q: What transaction per second is the specification requesting?
A: This will be an ongoing thing with multiple versions. In the beginning the tx rate requirement will be limited but following version it will increase. The end goal of course is to support something very big (e.g., 3x times Bitcoin tx rate). See the section of the whitepapre on our Kik Points experiment.
Q: Kin doesn’t have an active product yet and so zero volume. Why have you decided that ETH (Ethereum) isn’t capable of handling volume transactions?
A: As of mid-2017, Ethereum can’t carry Kin’s expected volume. When the volume is small, Ethereum can work well and this is exactly why our alpha is running on it.
Q: So there are currently no exchanges that will support “Kin 2.0”?
A: We’re not using any second token. When migrating it will remain the same Kin.
Kin Rewards Engine Questions
Q: Who are the capitalists? The people who invested before the sale?
A: Yes and no. The capitalists are also the developers of services which will participate in the Kin Ecosystem and who will be incentivised to keep Kin in order to fuel their services.
Q: Capitalists are individuals with significant holdings of Kin. What counts as significant?
A: The distinction is not critical. It’s important to understand expected behavior of archetypes. If you have enough Kin where your behavior will try to maximize its value, you’re a capitalist. If you mostly care about using Kin inside an app, you’re a user.
The main idea is that to stimulate growth of the ecosystem. We need more users creating value, and capitalists need to be content so they don’t try to manipulate the incentives.
Q: Am I a capitalist because I am in the top 20 (50,100) of Kin holders?
A: Not necessarily. Capitalists are defined as users who are willing to manipulate their behavior (how they spend Kin) in order to maximize individual returns from the KRE. Regular users (non-capitalists) are defined as users who just spend Kin on things they would have consumed anyways even if the KRE did not exist. You can be a capitalist even if you hold a small amount of Kin, and you can be the largest holder of Kin without being a capitalist — it mostly depends on your actions.
Generally speaking, we expect many of the top Kin holders to be capitalists. These users are normally mindful to the value of their Kin holdings and are willing to protect themselves against inflation by adopting certain behaviors to keep the reward for their own holdings. The KRE is designed to accommodate this behavior.
Q: What is the reward for capitalists? Except the normal gains of market cap (minus the devaluation each day)
A: The KRE is not designed to reward capitalists. Capitalists are only enjoying the normal gains of market cap. The KRE is designed to reward digital service developers as they are actively contributing to the adoption of Kin by growing the ecosystem. Although capitalists can receive Kin from the KRE, we don’t view them as really taking part and being rewarded. When a capitalist votes for themselves, it’s the equivalent of opting out of the KRE entirely and taking their relative holdings from the reward pool. Since the reward is essentially generated by inflating the coin, a capitalist is essentially avoiding inflation for their holdings by voting for themselves and canceling the effects of this inflation with the relative reward they gain.
Q: “To enable this goal, Kik will opt out of participation in the rewards mechanism for no less than 12 months from time of the Rewards Engine launch, passing it on to third party developers of Kik bots. “ Page 5. Explain this? Why would Kik not be involved?
A: We believe that it isn’t fair for Kik to participate directly in the KRE and compete for its rewards for an initial period of time. Kik is already receiving Kin vesting from the predefined allocation during the TDE. Receiving Kin from the KRE well would be “double dipping.” In addition, as the first large-scale digital service to adopt Kin, Kik will have an unfair advantage in the competition and is likely to perform better than other digital services on the grounds of helping create Kin. By waiting an initial cooldown period of at least 12 months, other digital services will have enough time to adopt Kin, and we’ll reach a level playing field.
Q: Can the Kin team please confirm when the official clock for token allocation in circulation started? As in, are we already on the clock for the 3 month mark or does that clock start once technical paper published, listed on major exchanges, etc?
A: The first three-month mark started at the end of the token sale, on September 26, 2017.
Q: How do we (well..your team, etc.) correctly incentivize all parties along that spectrum?
A: The KRE RFC is our first attempt in creating such incentive structure. This model gives developers rewards on how well their apps create activity in the ecosystem — the rewards themselves can serve as an app’s monetization strategy.
Q: Can you mine Kin with GPU?
A: No. With Bitcoin, the network needs miners in order for it to be secure and in order for it to succeed. Kin needs digital services to grow in the ecosystem in order to succeed. The Rewards Engine pays developers whose apps create value in the ecosystem. So instead of mining, if you want to earn Kin, you need to create value in the system.
Not a developer? Apps will provide ways for you to earn Kin by creating value inside the app. You can see some examples of earning Kin in the whitepaper.
Q: If the KRE model suggests that inflation taxes will allocate real funds from investors to devs how are investors supposed to retain and increase value of their investment?
A: The idea of the KRE model is to create miniscule inflation on users so they will hardly see it, but the reward will be significant in luring developers into the ecosystem. The KRE RFC even discusses solutions that capitalists may use to protect themselves against that inflation — and we think it will still be OK.
Q: The inflation you proposed is much more than a little.
A: We disagree. The prices are not determined only by the supply. They are determined in the conjunction with supply and demand. The inflation schedule listed in the whitepaper specifies how the Kin supply grows over time, but the prices are also affected by the growth in demand, which is what we’re trying to stimulate with the rewards engine.
If the model we’re proposing is not good enough for that, hopefully we can improve it or adopt a better model. In the end, a reasonably stable economy (not inflationary or deflationary) is crucial for markets to succeed.
Q: Do any of the presale investors offer assistance to the team? If so, in which way?
A: Yes, many of the presale investors are strategic partners and continue to help Kin.
Q: Where does the demand come from (i.e., where is price established)?
A: Demand comes from opportunities to spend Kin inside apps. Kik is working with bot developers on such opportunities within the Kik messenger, and we expect other digital services besides Kik to join.
Q: Hi, I read the Rewards Engine whitepaper a few times. I get the sense that we are still far away from a working system, even an alpha release. At this point, it’s not clear to me why, as a developer, I would want to invest in applications for the Kin Ecosystem as opposed to doing that for an ecosystem such as BitClave (www.bitclave.com).
A: We are indeed very far from the end of Kin development, but we’re very close to an alpha release. We will have a full working cycle where users can earn and spend Kin soon.
A full working system will take much much longer. We will achieve this once we have enough opportunities to earn and spend within the ecosystem. We’re looking to add prominent digital services to the ecosystem, while we activate Kin over a blockchain platform that scales better. We’re also working on a user experience that enables mainstream consumers to earn and spend crypto easily and safely. So there’s still much work ahead.
Q: After the KRE is running, what services within Kik are guaranteed to remain free (e.g., messaging individual users, being in a normal group, etc.)?
A: We plan for existing free services to be remain free within Kik, even after the KRE is running. We see Kik as a testing ground for the KRE — a place for us to experiment and develop best practices for digital services. We want to help build economies, mostly between users and content creators inside of Kik. For example, an artist creating digital content, such as stickers, could share those for Kin, or a private group owner could limit participation in the group for Kin. In all of these scenarios, Kin is traded between Kik users, not paid by the users to Kik.
Q: Wouldn’t it be possible to add a proof of stake Reward Engine as well to give back to the token sale participants? Or does the Kin Foundation just expect us to vote for ourselves everyday?
A: This is an interesting idea that is worth discussing. We’re not sure rewarding Kin holders (such as token sale participants) just for holding Kin will promote the growth of Kin. Let’s assume the entire reward goes to all Kin holders in proportion to how much they hold. It’s not difficult to see that this is a zero sum game and this action will not change the value each user holds. If we had only two users (one holding 20 tokens, the other holding 80) and divide a reward of 50 tokens between them , the first would get 10 tokens and the second would get 40. The result is still a 20/80 split between the users — there will just be more tokens overall. The actual value each user is holding will not change.
The true purpose of the KRE is to incentivize digital service developers. We can view digital service developers as the “miners” of the network, where the work they do is bringing more of their users into the Kin Ecosystem and growing Kin adoption. We believe that increasing adoption and demand for Kin will eventually contribute more to the long term value each token sale participant holds.
Q: Could the KRE be used to launder money?
A: No. We are working through a KYC (Know Your Customer) process for Kin Ecosystem participants to mitigate money laundering. Since digital service developers are not mainstream consumer, and their number is fairly limited, adding KYC will not introduce significant friction that will be harmful to the ecosystem.
Thanks again to all the people on Telegram and Reddit for these great questions, and to our dev and community teams for the answers!
