It seems like all it takes to jump-start a sluggish stock these days is a single mention of cryptocurrency. Now Eastman Kodak Company (NYSE: KODK) says it has created its own cryptocurrency called “KodakCoin,” sending the stock’s price soaring.
KODK stock went up more nearly 120 percent on Tuesday, and opened Wednesday up another 82 percent.
According to the company, Kodak has used blockchain technology to build KodakCoin to serve as a cryptocurrency platform for digital photography. Kodak said its new KodakOne website will be a “new economy” in which digital photographers can sell and license their photos.
Blockchain technology is the same type of community verification system that makes popular cryptocurrencies like bitcoin so secure.
“Kodak has always sought to democratize photography and make licensing fair to artists,” CEO Jeff Clarke says in a statement.
Kodak also said it would be installing a row of bitcoin mining machines at its headquarters.
Kodak isn’t the first company to seize the opportunity of blockchain technology and the cryptocurrency craze to reinvent a struggling business. Biotech stock Bioptix rebranded itself as Riot Blockchain (RIOT) last year, and beverage company Long Island Iced Tea Corp recently pivoted its business to blockchain technology when it changed its name to Long Blockchain Corp. (LBCC). Both stocks have more than doubled in the past three months on cryptocurrency momentum.
The volatile price action in many of these cryptocurrency-related stocks may be driven in large part by the lack of available cryptocurrency investment options. It can be difficult for investors to buy and sell bitcoin and other cryptocurrencies directly, and the U.S. Securities and Exchange Commission has yet to approve a bitcoin exchange-traded fund to trade on a major exchange due to concerns over investor safety. The Bitcoin Investment Trust, which trades over-the-counter, has delivered a stunning 1,790 percent return in the past year.
For now, it seems as though cryptocurrency-starved traders are piling into the GBTC fund, Kodak and any other remotely viable plays on the hottest trend in technology.
University of Cambridge economic historian Garrick Hileman says this type of trend should be familiar to investors.
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