- Veltyco said it has “commenced discussions with blockchain and cryptocurrency providers” about potential partnerships.
- Stock jumps 20% at the open in reaction to the news, before settling back to a 14% gain.
- A growing number of small, listed businesses are pivoting to cryptocurrencies and seeing a bump in their stock, as investors clamour to get a slice of rocketing bitcoin prices.
LONDON – Gaming company Veltyco saw its stock price leap higher on Thursday after telling investors it has “commenced discussions with blockchain and cryptocurrency providers” about potential partnerships.
Veltyco, which provides online marketing services to gaming companies, said it hopes to create a cryptocurrency wallet that it can market to its customers.
The company said: “Veltyco is planning to offer its customers the use of a crypto wallet that can be used across the platforms of all of Veltyco’s partners, allowing customers access to each platform without having to make separate deposits on the individuals platforms as well as enabling Veltyco to cross-sell the different platforms to its customer base.”
The announcement sent Veltyco’s shares, which are listed on London’s AIM growth market, jumping 20% at the open. The stock has pulled back a little since then but, as of 9.05 a.m. GMT (4.05 a.m. ET), it is still up around 14%:
Cryptocurrency has become one of the hottest areas of investment in 2017 thanks to the rapid rise of bitcoin, up over 1,500% against the dollar this year, and the proliferation of new digital coins created through “initial coin offerings”, where companies issue their own digital currencies.
Blockchain refers to the cryptographic technology that underpins digital currencies, allowing them to be decentralized, open systems. Investors see huge amounts of potential for this technology in everything from healthcare to voting. (UBS said this week it believes bitcoin is a bubble but urged clients to back blockchain.)
Veltyco is not the first company to see its stock jump after piggy-backing on the recent cryptocurrency boom. On-line, another AIM-listed company, saw its share price rocket 394% after adding “blockchain” to its name. Fintech business LongFin rallied 2,600% in a week after buying “a blockchain-empowered global micro-lending solutions provider” that handles cryptocurrencies.
Bloomberg on Wednesday highlighted a current craze for small-cap companies to pivot to cryptocurrencies, with everything from furniture manufacturers to gold miners, and even a sports bra designer, getting into digital currencies. In most cases, the move has resulted in a bump in the stock price.
Business Insider Emails & Alerts
Site highlights each day to your inbox.