Eastman Kodak Co. (NYSE:KODK) share price surged as much as 281% in the last two days alone, driven by the company’s announcement of launching its own form of blockchain technology. After the yesterday rally, KODK share price gained 70% in the early trading session and the momentum looks unstoppable. Its share price is currently trading around $10 a share, representing a growth of more than $7 a share in the last two days.
In the last two decades, photographers have notably struggled to receive payment for their work and to control the rights of their images. In response to this issue, Eastman Kodak has announced its partnership with WENN Digital to create the new digital currency which will protect photographer’s image rights
This announcement turned out to be a life-saving injection for Kodak, whose share price tumbled 84% in the last three years. But now shares are rallying.
Kodak’s move to blockchain and a cryptocurrency platform for photographer’s, looks like a solid strategy for the company compared to the Long Island Iced Tea transformation.
The partnership between Wenn Digital and Kodak is likely to use the Ethereum blockchain. However, they will issue a separate currency called the Kodak Coin.
The company’s CEO said they will receive a royalty from these transactions based on some percentage that is not disclosed yet. Some investors believe that the latest rally is offering a selling opportunity, due to Kodak’s poor financial numbers. They believe that the royalty payments wouldn’t be enough to cover Kodak’s losses.
“When you consider the use case they have to improve ownership rights for image owners in the digital space it’s got a good reason to be involved,” observes ETX Capital analyst Neil Wilson. “To what extent it will improve earnings I simply don’t know and I doubt anyone really does,” he adds.
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Time will tell the actual impact of the Kodak coin. If it doesn’t have a real impact on its financial numbers, Kodak’s share price won’t be in a position to hold gains.
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