The blockchain as a PR: companies capitalizing on innovative technologies

The blockchain as a PR: companies capitalizing on innovative technologies

Shenzhen stock exchange in China has been exposing companies that use the concept of the Blockchain to create excitement around their stock.

Companies use anything to ensure that their shares went up: from cost reduction to creating innovative new products. And more recently, they began to take manipulative steps, such as buying shares of companies related to blockchain technology, as well as false statements about the development of business models on the Blockchain, wanting to increase their visibility and attract investors.

A number of companies in the Chinese market, recently made similar statements that led to a sharp increase in the value of their shares. One of them is Zhejiang Enjoyor Electronics Co., Ltd, which was placed in social networks a message stating that one of the firms collaborating with the centre of forensic Sciences in Janssen to release electronic medical certificates based on the blockchain.

Needless to say, this caused an explosion of interest in the shares of Zhejiang Enjoyor Electronics Co., Ltd. This statement has led to increased sales and higher stock prices. The sharp increase in prices quickly attracted the attention of Shenzhen stock exchange, the lists of which is the aforementioned company.

The exchange asked the company to provide more information to verify that this information is true. A question was raised about the number of shares owned by Zhejiang Enjoyor Electronics Co., Ltd, blockchain, the company and a number of other financial issues. Zhejiang Enjoyor Electronics Co., Ltd. failed to provide a plausible answer and, in the end, I deleted your post in social networks.

Zhejiang Enjoyor Electronics Co., Ltd. not the only company that uses the blockchain as a means of self-promotion. Shenzhen stock exchange conducted a similar survey of 17 companies and found that 10 of them are misleading investors and nothing to do with Baccano.

This problem becomes increasingly important. This prompted the stock exchange to publish the following message:

“We will carefully review such statements and also to monitor the growth of shares in the secondary market. The companies that speculate on the Blockchain and mislead investors, will be subject to disciplinary sanction and serious violations, the exchange will inform the Commission for regulation of the China securities (CSRC).”

A similar phenomenon is occurring all over the world. Some companies just add the word “blockchain” to their names. For example, shares in a British company grew by 433% in just a few hours after the name change. Or American Long Island Iced Tea, which last year became Long Blockchain Corp., then its stock rose more than 200%. Although the company is still engaged in the trade of tea and has nothing to do with the technology of the Blockchain.

A number of companies that have announced plans for the development of business models related to blockchain technology, has demonstrated the increase in the value of shares. For example, shares of Eastman Kodak rose more than 100% after launching its own cryptocurrency KodakCoin.

The blockchain has huge potential and the introduction of this technology can significantly improve the efficiency of the companies. However, investors need to understand that most companies are willing to lie, and various tricks in order to attract interest and increase their income.

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