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Kodak Announces Cryptocurrency and Bitcoin Mining Machine at CES, Shares Soar.

US photo firm Eastman Kodak has become the latest company to see its shares soar after revealing plans to hold an initial coin offering (ICO) for its own cryptocurrency, the KodakCoin.

Kodak also revealed plans at CES in Las Vegas on Tuesday to lease bitcoin mining capacity via a machine named the Kodak Kashminer.

The company, whose stock price jumped by nearly 120 per cent following the announcement of its ICO, said it would offer customers the opportunity to rent a bitcoin miner on a two year contract, for $3,400 in an upfront payment.

In return, users would make $375 per month. This would equate to a profit of $5,600 at the end of the two year period.

Observers on Twitter were quick to point out several flaws in Kodak's plan.

"At current prices, Kodak gets half of all bitcoin you produce," said journalist Chris Hoffman.

Bitcoin expert Saifedean Ammous said: "There is no way your magical Kodak miner will make the same $375 every month, unless bitcoin mining difficulty stays the same. It is currently increasing at around 15 per cent a month, so mining output should drop around 15 per cent a month, too."

"Good luck to everyone who bought this deal!" he added.

Taking in to account the 15 per cent difficulty adjustment, the actual returns on the Kodak miner will be $2,457 on a $3,400 investment, according to Ammous.

Mining bitcoin becomes more difficult as more miners join.

Kodak, most famous for its cameras, announced on Tuesday that it was partnering with London-based Wenn Media Group to carry out the ICO, which will form partof a blockchain-based initiative helping photographers control their image rights.

It is the latest in a series of companies to see its value jump after revealing plans for blockchain-related activity.

"This is a phenomenon we saw back during the dot com days in the late 1990s where traditional companies would mention some kind of internet strategy and their stock price would jump up," Garrick Hileman from the University of Cambridge told the BBC.

"When you see stock prices moving like this it does appear to be troubling - it's hard to say if there's a bubble but it certainly is indicative of a frothy investment market," he added.

Source: Gulf news

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Publication:Albawaba.com
Date:Jan 10, 2018
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