A former iced tea and lemonade manufacturing company, Long Island Iced Tea, is investing in Bitcoin mining machinery. This move comes after the company watched its stock price jump 500% following a name change to Long Blockchain. The company made the name change two weeks ago, capitalizing on the Blockchain euphoria sweeping the globe.
The company has announced that it will offer 1.6 mln shares at $5.25 per share, hoping to raise $8.4 mln. The company’s press release indicated that the stock sale would allow the company to move into the Bitcoin mining business.
“The Cryptocurrency mining equipment expected to ship in January 2018 for immediate deployment in experienced Nordic Data Center. This mining equipment is manufactured by Bitmain. Agreement with certain third parties to purchase 1,000 Antminer S9 mining rigs and 1,000 APW3++ PSUs.”
Other companies have also seen massive stock price increases on relatively unimpressive news related to cryptocurrencies. For example, Longfin, a small cap stock, recently exploded in value – rising more than 1,300 percent – after announcing it would buy a defunct cryptocurrency.
Other industry experts agree that euphoria is gripping the industry, though they see the potential for real Blockchain use cases to continue to gain momentum. Dominik Schiener Co-Founder of IOTA told Cointelegraph:
“The entire market as it stands today, is in a bubble with more than a few dozen projects having reached unicorn valuation. This obviously won’t last long, as 2018 will be a year where we will see a major consolidation happening, with every project having to prove its merit not just to the market, but also to the public. After all, only the projects with real-world adoption and true value will prevail.”