The cryptocurrency fazes in the financial and investment has remained unclear even when the prospects are exciting and rewarding. Investment experts do not know how long the bubble will take before it bursts and is divided on the topic. What worries is that companies are launching cryptocurrencies with the same expectations as Bitcoin and Ethereum. When Eastman Kodak Company decided to enter the blockchain, the move has not worked as expected. According to Sahm Adrangi, Kerrisdale Chief Investment Officer, the move to launch KODAKOne and KODAKCoin are flawed and will not provide material benefits to shareholders. The partnership seeks to initiate a photo-centric cryptocurrency and blockchain-enabled image licensing platform.
He observed that the share that was below $3 by the end of 2017 rose dramatically to $13.28 when the company announced its KODAKOne and KODAKCoin representing a 400% increase. The hype was short lived as the share closed at $5.85 on February 5 and Sahm Adrangi believes Kodak announcement cannot solve their unsustainable financial structure and business model. Kodak needs to address their mounting default risk, negative free cash flow, and declining revenues, rather than use a business model that does not work, advised Sahm Adrangi.
He adds that members of the company’s board of directors awarded themselves restricted stock a day prior to launching KODAKOne. It brings in suspicion that can lead to SEC investigation. Sahm Adrangi and Kerrisdale offered a negative report on the partnership between Kodak and WENN Digital Inc., the lead developer of KODAKOne, saying it has a dubious background. The same case applies to AppCoin Innovations Inc., which is the KODAKCoin strategic advisor.
Sahm Adrangi is the founder and chief investment officer of Kerrisdale Capital overseeing the company progress from a $1 million to $ 50 million manager from 2009-2017. He is known for sharing research on stocks especially under-followed longs and hyped shorts. Kerrisdale mission is to correct misconceived aspects about business prospects.
By exposing fraudulent Chinese companies in 2010 and 2011, Sahm Adrangi earned himself a name as the companies faced charges from the Securities and Exchange Commission. Kerrisdale is focused on the biotechnology sector developing expertise in the area, as well as the mining industry.