Joining the cryptocurrency craze. Time
Investors can't seem to contain their excitement for Eastman Kodak's new cryptocurrency venture.
A day after Kodak announced the project, the stock price had more than tripled. Trading closed at $10.70 a share Wednesday afternoon, up from $3.10 when the New York Stock Exchange opened on Tuesday. At one point Kodak's shares were trading as high as $13.28.
This sudden surge of interest in the former photo giant's stock was prompted by Kodak's bold new digital play, unveiled at the Consumer Electronics Show in Las Vegas Tuesday,
The KODAKOne program will offer photographers a platform for protecting their digital rights and generating revenue from their images.
Underlying that platform will be KODAKCoin, which the company says will become "the currency of choice for the image economy." The system will use blockchain technology, which is a ledger where transactions of digital currencies, like bitcoin, are recorded
"Engaging with a new platform, it is critical photographers know their work and their income is handled securely and with trust, which is exactly what we did with KODAKCoin," said CEO Jeff Clarke.
The 130-year old company emerged from bankruptcy in 2013 with a new focus on digital printing and consumer packaging. But revenues have fallen each year, from $2.4 billion in 2013 to $1.5 billion in 2016. Quarterly reports for 2017 continued to show year-over-year declines.
Tech investors have been driving up stock prices for companies involved with digital currency or blockchain technology, even in cases where the link is tenuous.
Recently, Long Island Iced Tea Corp. said it plans to change its name to Long Blockchain Corp., as it wants to focus more on blockchain technology, while continuing to make beverages.
Chanticleer Holdings, which operates restaurant chains like Hooters and American Burger Co.announced last week it would use cryptocurrency for its customer loyalty programs.
Both companies saw share prices rise dramatically as a result.
Clarke acknowledged the buzz around these technologies but dismissed skeptics who said the KODAKOne announcement was a ploy aimed at giving the stock a short-term boost. Rather, he explained, it was the next step in what has always been part of the company's key mission: empowering photographers.
"For many in the tech industry, ‘blockchain’ and ‘cryptocurrency’ are hot buzzwords, but for photographers who’ve long struggled to assert control over their work and how it’s used, these buzzwords are the keys to solving what felt like an unsolvable problem," Clarke said.
The company plans an initial coin offering on January 31. Investors can learn more on the newly launched KodakCoin.com website.