Shares of Farmingdale-based Long Blockchain Corp., which on Thursday announced it would pivot its business focus from iced tea to digital currencies, fell Friday as the price of bitcoin, the most popular such currency, dropped as well.
Until this week, the company was named Long Island Iced Tea, and was known for its ready-to-drink beverages in flavors such as peach, raspberry, guava, lemon and mango. But Thursday it said that it was undertaking a rebranding.
The company announced it will change its name and, while still selling tea, it would shift its primary focus to “the exploration of and investment in opportunities that leverage the benefits of blockchain technology.”
LI Iced Tea to change name to Long BlockchainThe Farmingdale beverage company’s stock jumped 180% after it announced its “pivot” to focus on the technology behind bitcoin.
Bitcoin and other types of “cryptocurrency” are digital currencies that are not tied to a bank or government and allow users to spend money anonymously. The coins are created by users who “mine” them by lending computing power to verify other users’ transactions, and receive coins in exchange. A blockchain is a global running tally of every transaction in the currency.
As of Thursday, bitcoin has soared more than 1,500 percent in price since the start of the year. And shares of Long Blockchain soared more than 180 percent to $6.91 Thursday after the news of the name change.
But on Friday, bitcoin fell as much as 30 percent overnight in Asia. It later made up much of that ground, finishing with a decline of 9.5 percent to $14,042 Friday, according to the tracking site CoinDesk.
Shares of Long Blockchain, the iced tea maker, fell 13 percent to close at $6.01.
“There is craziness going on,” said Emin Gun Sirer, an associate professor of computer science at Cornell University. “There always is when there is exciting new technology.”
Long Blockchain did not return a call for comment.
The company has not earned a profit since going public in 2016. Its news release Thursday announcing the new focus did not offer definitive plans for the technology, saying only that it sees a “once-in-a generation opportunity” and that it is in the “preliminary stages of evaluating specific opportunities.”
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CORRECTION: Long Blockchain Corp. is headquartered in Farmingdale. An earlier version of this story misstated the headquarter’s location.