Kodak creating KodakCoin, develops its own cryptocurrency system

Sean Lahman | Rochester Democrat and Chronicle

Show Caption Hide Caption Kodak announces plans to launch ‘Kodakcoin' Joining the cryptocurrency craze.

Shares of Eastman Kodak stock were up more than 100% in afternoon trading after the company announced a new cryptocurrency initiative.

On Tuesday, the company unveiled a licensing partnership with Wenn Digital to launch an image rights management platform called KODAKOne and a photo-centric cryptocurrency called KODAKCoin.

The stock price opened at $3.10 a share Tuesday and rose as high as $7.47 after the announcement was made at the CES technology show in Las Vegas.

In a release, the company said the KODAKOne platform will be an encrypted, digital ledger of rights ownership for photographers to register both new and archival work that they can then license for use.

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The company describes KODAKCoin as "a new economy for photography," which will allow photographers to receive payment for licensing their work immediately upon sale, sell their work confidently on a secure blockchain platform.

The system will be open to both professional and amateur photographers.

Initial reactions from financial analysts were mixed.

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CBS Marketwatch said Kodak was "boarding the blockchain bandwagon," hoping to capitalize on the cryptocurrency trend to boost its stock price.

Bloomberg said "The move comes as investors snap up virtually any asset related to digital coins or the blockchain technology that underpins them — no matter how tenuous the tie."

The Financial Times was more blunt in its criticism, calling it "Kodak's last desperate bid for relevance."

Kodak makes last desperate bid for relevancy with “photo-centric cryptocurrency” https://t.co/hE7ZDHuqNv — Financial Times (@FT) January 9, 2018

"The real concern in the financial community is whether Kodak's senior management has come up with this idea as a way to boost the stock price and let short term holders cash out," said George Conboy, chairman of Brighton Securities.

Conboy says that analysts have been concerned for several quarters that Kodak's core businesses didn't seem to be taking the company in a positive direction. He's skeptical whether this cryptocurrency initiative represents a sustainable business.

"It appears that Kodak is jumping on a bandwagon that has lately been driven primarily by hysteria, and smacks of a move that suggests that management doesn't have any better options."

In a press release announcing the move, Kodak CEO Jeff Clarke acknowledged the current cryptocurrency craze, but said the launch of the KodakOne platform was an extension of the company's 130-year long tradition to help empower photographers.

"For many in the tech industry, ‘blockchain’ and ‘cryptocurrency’ are hot buzzwords, but for photographers who’ve long struggled to assert control over their work and how it’s used, these buzzwords are the keys to solving what felt like an unsolvable problem," Clarke said. "Kodak has always sought to democratize photography and make licensing fair to artists. These technologies give the photography community an innovative and easy way to do just that."

The KODAKOne platform will provide continual web crawling in order to monitor online use of images that have been registered. When unlicensed use is detected, the platform can help photographers reach licensing arrangements and get rewarded for their work.

The initial coin offering will open on January 31, 2018 and is open to accredited investors from the U.S., UK, Canada and other select countries.

The company also announced a website, KODAKCoin.com which they say will have more details in the coming days.

SLAHMAN@Gannett.com