Long Island Iced Tea Group, a business part-owned by expatriate New Zealand businessman Eric Watson, has tapped into the cryptocurrency craze by changing its name to Long Blockchain Group.
Blockchain is the technology behind the Bitcoin phenomenon, enabling any type of encrypted data – from electronic money to medical records – to be shared between members of a closed network.
Watson filed the name change with the United States Securities and Exchange Commission on December 6 under Cullen Holdings, the parent company of the business.
Watson, whose fortune was estimated at $420 million, entered into an agreement in early 2015 to merge his US dairy farming venture Cullen Agricultural with the Long Island Iced Tea corp. The combined business was subsequently renamed Long Island Brand Beverages.
The decision to now change the name to Long Blockchain has delivered an almost-immediate market response, with shares in the business rising six-fold, or 500 per cent.
This is the latest in a near-daily phenomenon sweeping the stock market, where obscure microcap companies reorient to focus on some aspect of the mania sparked by bitcoin's 1600 per cent rally this year.
According to the Telegraph, the company says it will change its name to Long Blockchain Corp because its parent company, Cullen Holdings, is shifting its corporate focus towards the "exploration of and investment in opportunities that leverage the benefits of blockchain technology".
The company, which will ask Nasdaq to change its trading symbol in connection with the name change, said it will continue to focus on the ready-to-drink segment of the beverage industry. It has also registered the new web domain www.longblockchain.com.
Long Blockchain so far has little to show for its aspirations. It has no agreements with any blockchain firms, and says "there is no assurance that a definitive agreement with these, or any other entity, will be entered into or ultimately consummated".
It follows a similar move by a British company in October, when On-line Plc announced plans to change its name to On-line Blockchain Plc, sending its share price soaring 394 per cent – the biggest one-day gain for the small-cap company since its first listing in 1996.
At the time, the company said: "Blockchain technology and cryptocurrencies are a new and exciting area we have been working on for some time. We feel the time is right to re-name the company to reflect these developments, where we believe the future growth will be in our sector."
On-line's share price has continued to climb since its name-change, from around 15p in October to a high of 134p this week.
Shares in Colorado-based Bioptix Inc also flew in the days leading up to its name change to Riot Blockchain Inc, nearly doubling in value, according to Bloomberg.
This move comes at a time when established financial bodies are looking at ways blockchain technology can be used.
Nasdaq has been investigating the possibility of creating distributed ledgers for private company share registers, while the Australian Stock Exchange is testing whether blockchain could be used to replace its existing clearing and settlement systems.
- Additional reporting from Washington Post and The Telegraph.