In January, a Bitcoin mining computer that was labeled the KodakMiner was on display at the CES technology show in Las Vegas. And truly, Kodak was going after the crypto market. Though this was an attempt by the company to enter the crypto mining industry, critics have labeled the device as a “scam”. When the critics crunched the numbers, they discovered that it projected profits are unachievable. And the price of the mining hardware has been concluded as impractical.
If you weren’t too careful and you bought the Kodak KashMiner, this would’ve cost you $3,400 up front for a 2-year rental period. In addition to this, you are going to provide them with a cut of the crypto mined by the device. According to reports, profits are expected at $375 monthly which could accumulate to around $5,600 in two years.
Plan Wasn’t Feasible
The numbers weren’t exactly adding up. In order to pay for the scheme, Bitcoin will have to be around $28,000. And unfortunately, this hasn’t even happened yet. Since January, Bitcoin was already on a slide. In fact, Bitcoin started 2018 at around $14,000 and even lost more than half of its value currently.
This scheme was shut down by the SEC. And also, the company chose to note finish the KashMiner website. It ended up with just some placeholder text in the site.
Also, Kodak mentioned that the third party company that was behind the mining rig, Spotlite USA, never had the Kodak brand officially licensed. And apparently, this was only a rebranded version of the Antminer S9. Now, Spotlite says that it is simply going to run its own mining operation than have the Kodak branded miners rented out publicly.
Kodak and Crypto
It isn’t the first time that Kodak has been involved in the crypto industry. Since stepping into the digital age, Kodak as a company has suffered from losses. What Kodak initially did was raise funds using an ICO scheduled on January this year. The initial plan according to their statement was to attract over 40,000 potential investors.
After the announcement, the share price of Kodak spiked up from just $3.10 to $11 the day after. However, they were criticized for taking part of the crypto market without any concrete plan. However, Kodak’s chief executive mentioned that the blockchain project is a genuine attempt in order to help photographers resolve ownership issues.
The ICO also suffered the same fate as the Kodak KashMiner because of the SEC. The company announced that the ICO was postponed to May because of this. In a statement released by KodakONE CEO Jan Denecke, “The Securities and Exchange Commission says every token is considered a security”. In addition to this, “ If you go out with a SAFT, you can still adjust to future views on how tokens are going to be considered by jurisdiction and authorities” .
Regulatory clarity is needed in order to stop scams in the crypto industry. Considering the interest is still quite high among investors, it is good news that the US SEC is actually doing its job well in regulating the market.
