Shares of Eastman Kodak more than doubled after the company
waded into the digital-currency world with plans to launch an initial coin
Tuesday said the coin, KodakCoin, would be the backbone of a new platform that
will help photographers license their work and track the unlicensed use of
their images. The coin uses the technology behind bitcoin, called blockchain,
to keep a digital ledger of the photographs.
In an initial coin offering, a firm
creates its own bitcoin-like digital token and offers it publicly for sale. The
token is usually designed to unlock some service on an online platform, like
with Kodak’s project.
“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,” said Kodak CEO Jeff Clarke in a statement.
Kodak’s foray into crypotcurrencies
boosted shares 119% on Tuesday and put the company’s market value at $290
million, according to FactSet. More than 65 million shares changed hands on the
day, and the stock soared another 46% in after-hours trading.
Since emerging from bankruptcy
protection in 2013, its highest-volume day before Tuesday occurred when 2.15
million shares changed hands, according to FactSet. Even with Tuesday’s rise,
Kodak is down more than 50% over the last 12 months. The company has struggled
to adapt to new technology in recent years.
For the past several years, people have
been experimenting with ways to use blockchain. At its essence, blockchain is
an open record of transactions, maintained in an online ledger that is
distributed across a network of computers, that cannot be tampered with. That
makes it like an indelible time stamp, which could be useful in a case of
copyright and digital-rights management.
Initial coin offerings are a relatively
new phenomenon that exploded in 2017, raising more than $4 billion last year,
though regulators like the Securities and Exchange Commission have warned about
the risks and have shut down some egregious malefactors.
Kodak is the latest company to see its
shares soar after publicizing plans to explore the world of bitcoin, blockchain
and initial coin offerings. On Tuesday, Kodak’s shares climbed $3.70, or 119%,
Others getting into the area include a
former electronic cigarette company, a biotech firm, and an entity formed last
year through a reverse merger with a sports-bra maker.
A company that owns several burger restaurants, Chanticleer Holdings, saw its shares rise more than 40% on
Jan. 2 when it announced that it would use blockchain technology to provide a
currency for its customer loyalty programs. A firm formerly known as Long Island Iced Tea managed to avoid getting its
shares delisted after it changed its name to Long Blockchain Corp. last month
and said it was pivoting to investing in blockchain
Sometimes, even rumors are enough to send a company’s shares
higher. Western Union and Seagate
Technology PLC have both popped in the past few days after
little-known websites claimed the companies had ties to a digital currency
called ripple. Western Union and Seagate didn’t respond to a request for
comment. Ripple, the company, declined to comment.
KodakCoin’s initial coin offering, or
ICO, will begin on Jan. 31 and is open to accredited investors from the U.S.,
U.K., Canada and other select countries. A Kodak spokesman said the ICO is
being offered by WENN Digital, a technology company that created the KodakOne
platform and the KodakCoin cryptocurrency. Kodak and WENN entered a licensing
partnership for the platform and KodakCoin.
here for the original article from The Wall Street Journal.