A New York-based company saw its shares spike almost 500% in pre-market trading Thursday after announcing its new focus would be exploring and investing in the technology that underpins cryptocurrencies like bitcoin-which wouldn't be so remarkable but for the fact that it previously made a name for itself selling iced tea. Just change your name to something blockchain. Shares spiked as much as 500 percent in premarket trading, eventually settling at a 275-percent gain, never mind that the company plans to maintain its focus on ready-made, grab-and-go drinks, and thus far has little to show for its supposed aspirations to expand into blockchain technology.
We may have reached peak cryptocurrency. Diagnostic company Bioptix's shares soared 400 percent after it changed its name to Riot Blockchain RIOT.O in October.
During the internet bubble, some companies were able to boost their stock prices simply by inserting a "dot-com" in their names or, virtually overnight, refashioning themselves as e-commerce companies. Long Island Iced Tea, the product of a 2015 merger with Cullen Agricultural Holding, has been funding operations through a combination of equity and debt sales.
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The "Long Blockchain Corp" name change is just the latest in a line of companies making questionable moves to ride the euphoria surrounding bitcoin and the blockchain technology backing it. According to Business Insider, shares were trading at around $13 prior to the opening bell Thursday morning, representing a more than 400 percent rise from Wednesday.
Long Blockchain is just the latest in little-known micro cap stocks capitalizing on blockchain to spin heads on the trading floor, leaving some investors anxious about possible fraud and unmerited valuations. The SEC suspended the trading in the company until January, citing "concerns regarding the accuracy and adequacy of information".
IBD'S TAKE: Amid the crpyto-frenzy, the SEC has this advice for investors.
One thing is sure, though, this type of activity reflects a very weird and wild crypto ride this year.