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On January 9th, The Eastman Kodak Company announced that it would be launching its own digital currency called KODAKCoin. According to Kodak the cryptocurrency will, “allow photographers to take part in a new economy for photography”. However, talking to the New York Post Guy Gentile, CEO of SureTrader called the newest cryptocurrency “completely useless”.
The 130-year-old company partnered with London based paparazzi firm, WENN Digital. Together they will launch KODAKOne the image rights management platform and KODAKCoin. The exempt initial coin offering (ICO) opens to qualified investors on January 31. Weeks before, Gentile appeared as a guest on Bloomberg’s “What’d You Miss” and called such moves “pump and dump schemes”. The CEO said that companies in need of capital publish press releases announcing their move into the cryptocurrency industry to boost their stocks. Then eventually a secondary offering follows, leaving retail buyers holding the bag.
Before its announcement on Tuesday, Kodak’s stock was trading at around $3. After its announcement it jumped to around $6.80, rising again to $10.60 the following day. But, on Thursday as reports of doubts came in from Wall Street the shares dropped 21 percent to around $8.40. Gentile being a professional day trader began tweeting as the stock moved. On his Twitter (@GuyGentile) he warned, “This has the potential to be a super squeezer and could get over $20. But it will crash after the squeeze be (careful) shorting this”. Walking away with a gain after shorting the stock the expert trader tweeted, “Thank you for the easy money”.
But Gentile is not the only one calling out Kodak. Bloomberg’s columnist, Matt Levine also criticized the announcement. The former investment banker believes that the post-film photography company does not need to use blockchain technology or their own currency to operate a web crawler and central database for photographs or to create a market place to buy and sell images.
In his article,“Good Luck Spending Your KodakCoins” Levine points out that due to Kodak’s exempt ICO, middle class individuals will not be able to buy KODAKCoin stocks. All purchasers must be accredited investors, having either $200,000 in come or a net worth of $1 million. The former lawyer also highlighted the fact that the digital currency will be hard to sell for cash. The SEC warned about private-placement securities like KODAKCoin in 2014 saying, “you should not expect to be able to easily and quickly sell your restricted securities. In fact, you should expect to hold the securities indefinitely.”
SureTrader is a division of Swiss America Securities, Ltd. and operates as an online, discount stock and options broker dealer for active traders. Brokerage services are not intended for U.S. residents. SureTrader offers a trading platform accessible to all experience levels with market access to retail traders and investors all at a cost-effective price and with the latest technology. SureTrader’s platforms technology includes real-tie quotes and stock charts in web-based, downloadable or mobile applications for flexibility and convenience. It also features lightning fast stocks, options order executions coupled with real-time market data, advanced order types, multiple charting features, including technical indicators and more. For more on Sure Trader, visit www.suretrader.com.
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