FinTech Stock LongFin Surges 2,600% Following [Suspicious link removed]pany Acquisition
The cryptocurrency worlds recent heights, with Bitcoin surpassing $19,600 per coin, and Ethereum reaching a new all-time high above $850, are seemingly heavily influencing the way traditional investors look at some stocks. Fintech firm LongFin (Ticker: LFIN) recently saw its value surge as much as 2,600%, following a press release.
The press release revealed that LongFin bought Ziddy.com, a blockchain-empowered global micro-lending solutions provider. The announcement helped LongFin, which began trading last week, hit a $7 billion market value at its peak.
LongFin purchased Ziddu.com from Meridian Enterprises in exchange for 2.5 million company shares. The move and the subsequent stock surge were certainly sweet for LongFins CEO, Venkat Meenvalli, as he owns 95 percent of Meridian Enterprises, according to reports.
The stocks wild ride began last week when LongFin started trading on Nasdaq and closed at $5.15 on its first day. By the end of the week it was at $39, and got to a high of $129.84 before its price retreated to $72. Even the companys CEO found the rally surprising, as he told Bloomberg:
Its crazy, frenzied speculation on the cryptocurrency announcement, which we never expected (
) The fundamentals will slowly show, but this is crazy trading and has nothing to do with the companys fundamentals.
The company, which has financial results dating back to 2015, essentially offers small businesses financing options, and aims to base some of its services on blockchain technology with the Ziddu acquisition. Its goal is to offer micro loans issued in Ziddu coins, their own cryptocurrency, backed by goods in borrowers warehouses. The cryptocurrency can then be traded for Bitcoin or Ethereum, which can then be traded for fiat. The loans will need to be paid back in cryptocurrencies, and their interest will vary between 12 to 48 percent.
LongFin describes itself as a global fintech company providing finance and hedging solutions to importers, exporters, and small and medium enterprises across the globe powered by artificial intelligence and machine learning, and is one of the various companies that recently saw their value rise after announcing affiliation with cryptocurrencies or blockchain technology.
The trend has been so notable, that analysts now claim adding the words bitcoin, blockchain, or cryptocurrency to the name of a company will lead to rapid stock appreciation. Companies like Riot Blockchain, formerly a biotechnology firm, saw their value increase after adding blockchain to their name.
Notably, LongFins IPO filing contains a warning telling investors that they should be able to bear a complete loss of their investment. Moreover, the companys CFO, Krishanu Singhal, and COO, Raj Mondraty, resigned on December 11. Nevertheless, its trading volume has surged, just like the stocks value.
from
https://www.ccn.com/fintech-stock-longfin-surges-2600-following-[Suspicious link removed]pany-acquisition/
