Blockchain-Related Stocks Frenzy In China, Proof Of Concept Or Real Actions

Talking about the buzzword of Year 2017, the eye-catching Bitcoin has been on the top list. In the first month of Year 2018, its underpinning blockchain technology has been the must-talk in the stock market in China.

According to media reports, since January of year 2018, blockchain-related stocks has risen sharply, with the index rising from 3,200 to over 3,700. After Bob Xu Xiaoping, a famous Chinese angel investor, gave out a message bullish on blockchain technology on January 9, many listed companies are riding the blockchain wave and putting them in the spotlight. They are simply releasing announcements with the keyword “blockchain” and their stocks are going crazy.

Bullish on blockchain technology

Xu’s bullish opinion about blockchain– “the blockchain revolution has already arrived. This trend goes forward with great vigor and strength. Riding the trend, you’ll prosper; off the trend, you are doomed” are crazily circulated and boost those to give it a go with blockchain. Although he stressed that it should “not be spread,” some pointed out that this is all planned for speculation of his invested blockchain companies as Yunphant and gongxinbao.

In the recent blockchain-related stocks frenzy, some companies are brutally change their name as Long Island Iced Tea Corp. has officially changed its name to Long Blockchain Corp (NASDAQ: LTEA), or adding “blockchain to their name, and some are saying they are exploring blockchain-related businesses. Others are supporting blockchain technology within their existing business frameworks. Even some companies give away their main business to focus ambition on blockchain.

A number of companies announced their blockchain business, while in effect few has generated income or profit for their company from their blockchain business on the evening of Jan.11. On its daytime the blockchain stocks spike 5.2% and 6.4% the day before it.

Yi Jian Supply Chain Management Co., Ltd. (stock code: 600093), as the first blockchain stock, reopened trading today after suspended for scrutiny with reaching several limit up. As the frenzy goes on, it has risen to the limit up for one more time at the press time. On its website, it writes that,

Yi Jian Supply Chain access optimal financing solutions through our supply chain finance platform.

Yi Jian provides supply chain management and factoring services through the use of innovative blockchain based solutions to control risks in traditional supply chains. We help companies access funding solutions, accelerate cash flow and reduce supply chain transaction costs.

Proper disclosure of company’s blockchain business

Compared with Yi Jian, some companies are less blockchain-related. Seeing the high sentiment of investors, they soon they made clarification and announcement that,

At present, the company’s blockchain business is in the period of incubation and exploratory, and it has not yet output relevant technology and products.

Their main idea is that the application of blockchain technology is still immature, and they are embracing blockchain technology with innovation and it is still under research and development.

As a revolutionary technology, blockchain draws a lot of attention. It may be too early to talk about its profitability in the context of application scenarios. In this way, proper information disclosure from these so-called blockchain-related companies are urgently needed. While there are no mandatory provisions requiring companies to disclose their financial information.

Shenzhen Kaifa Technology, a bitcoin miner manufacturer issued an public announcement saying the business hasn’t generated much profit for the company on January 14 and voluntarily disclosed their financial and other information via a statement on the company’s website clarifying that it is not a blockchain company.

Be alert and cautious

There are 33 blockchain-related stocks keeping rising out of 44 with change rate being 10.06% in recent five days, and more than 380 million CNY flows in at press time.

The current frenzy might obscure blockchain’s actual potential, along with the increase of stock price is the investors’ high spirit. Never be blinded by the full-eye red and be cautious of the risks of blockchain projects.

 

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