by Cindy Huynh
Kik’s CEO Ted Livingston does not believe that blockchain technology is for everyone. More to the point, the CEO appears pessimistic about the innovation underpinning bitcoin and other cryptocurrencies because he does not see the immense value it brings for many industries.
Blockchain is only for Cryptocurrencies
“Almost nobody should be looking at blockchain,” said Livingston. “Unless you’re trying to build one of the most-used cryptocurrencies in the world, it’s very low odds that blockchain is going to create value for you.”
According to the Financial Post, Livingston is convinced that there are few practical applications for blockchain other than cryptocurrencies. The CEO has however raised almost $100 million through an initial coin offering (ICO) for his Kik messaging application.
The CEO believes that the unique value from cryptocurrencies stems from the fact that it creates “digital scarcity,” allowing for limited tokens on a network which facilitates trust even though the participants do not trust one another. “What does blockchain do at the end of the day?” queried Livingston.
“It allows you to have a database that’s trustless. That can be applied in a bunch of ways, but most of those ways, you still need trust.”
Still Trust Dependent
To use an analogy, while blockchain technology can indeed create a transparent, indelible public ledger that informs customers and executives of a fish’s journey from ocean to store, it’s not much use when the fisherman can simply lie about where he initially caught the fish.
Livingston is not alone in his belief that blockchain technology is still dependent on trust. Dirk Baur, a professor of Finance from the University of Western Australia, along with Niels Van Quaquebeke, a Professor of Leadership and Organizational Behavior at Kuhne Logistics University, are also of the same mind.
According to The Conversation, both professors believe that “the blockchain does not create or eliminate trust. It merely converts trust from one form to another.” The professors go on to state that “this may not be ideal but a truly open public blockchain (that is, one without any central authority behind it) is unlikely to work.”
Competing with Tech Titans
While most members of the cryptocurrency industry are concerned with the titans of finance, Livingston is concerned with the titans of technology. “We were playing an impossible game,” said Livingston.
While Livingston is watching the competition closely, he is excited about the enormous incentives the world of cryptocurrencies has brought to the technology community. He believes that instead of mining through useless math problems, a lot of computational power could be used to solve a variety of real problems.
Livingston’s goal was to make Kin a digital currency for the messaging app and eventually other apps. Users could then pay one another and Kik could pay developers to create a variety of new features for the app.
Kik has, however, faced many tough situations. Despite raising $100 million via an ICO in 2017, they experienced significant technical problems. The company is currently building a hybrid blockchain of Ethereum and Stellar for the Kin token.