The once legendary camera company is getting into cryptocurrencies, and its stock is soaring.
- The camera company Kodak is partnering with a company to get into bitcoin mining.
- Kodak's stock soared more than 100% on Tuesday after it announced it would launch a cryptocurrency.
- Critics have attacked the company over the mining scheme amid fears of a cryptocurrency bubble.
Another day, another unusual company taking the dive into the cryptocurrency space.
Kodak, the once iconic camera company, is licensing its brand to Spotlite, which builds computers designed to mine bitcoin, for a new line of bitcoin-mining machines that they plan to rent to the public for thousands of dollars. Although just how associated Kodak wants to be with the device is an open question.
On Tuesday, at Kodak's booth at CES, the tech industry trade show in Las Vegas this week, the company showed off the new mining computer, then dubbed the Kodak KashMiner, and company's representatives handed out flyers to promote the arrangement with Spotlite. The device on display and in the flyer had the Kodak logo featured prominently.
But when we returned to Kodak's booth on Thursday, Kodak's logo was noticeably missing from the bitcoin miners. Instead it carried Spotlite's brand.
In addition to still trying to figure out the branding on the miner, the companies are also apparently still trying to figure out the terms under which they'll rent the machines to customers.
On the flyer, the companies said they'd ask prospective customers to sign a two-year deal and pay $3,400 up front to rent the mining machines, which are used to support the bitcoin network and create new coins. As part of the agreement, Spotlite would gets to keep half of all proceeds the machines generate by mining bitcoin.
Spotlite and Kodak estimated customers would earn $375 a month, making $9,000 over the two-year rental period.
But a Kodak representative later said the deal terms were preliminary and weren't necessarily what the companies would offer customers.
After seeing the announcement and the terms in the flyer, some people harshly criticized the new service on Twitter. Some argued that Kodak's jumping into bitcoin mining was evidence of a bubble in cryptocurrencies. Others said that because mining bitcoin gradually becomes more difficult over time, Kodak KashMiner customers may see far smaller returns than they anticipated.
Such concerns, however, haven't put off some customers — Spotlite's existing capacity is already sold out, a representative told the BBC.
"At this time we have 80 miners, and we expect another 300 to arrive shortly," the representative said. "There is a big pile-up of demand."
The new bitcoin-mining rental service was one of two blockchain-related announcements from Kodak at CES on Tuesday.
The company also said it would team up with Wenn Digital to launch a blockchain-based rights-management service and related cryptocurrency. The service is aimed at tracking the online use of licensed photographs and ensuring photographers get paid for their works.
Kodak's stock skyrocketed more than 117% on Tuesday.
The company is the latest to see its stock soar after announcing bitcoin- or blockchain-related news. Shares of Long Island Ice Tea Corp. tripled in price after it renamed itself Long Blockchain last month, and those of a franchisee of the Hooters restaurant chain jumped last week after it said it would move into the space.