Bachchans’ Bitcoin mania gains wiped out in just seven days; here’s how
Two and a half years ago, the Bachchans invested in a company not known by many. The company was Meridian Tech Pte, a Singapore based company. Company’s main asset — Ziddu-.com — was acquired by other company LongFin Corp. Since Bachchans held shares in Meridian Tech Pte, they received 250,000 shares of LongFin after Ziddu-.com purchase. It looks like a simple investment story, but it did take a dramatic turn: Bachchans’ investment worth $250,000 gave them returns of $17,500,000 ($17.5 million), which also got wiped out within days.
The Blockchain, Cryptocurrency mania: What really happened
LongFin Corp bought Ziddu-.com, two days after getting listed on NASDAQ. The company described itself as “a Blockchain technology empowered solutions provider” that offers microfinance using “cryptocurrencies across continents.” And, then what the words like Blockchain and Cryptocurrency and the mania helped company’s share to dramatically surge 2,500% on December 15when the deal to acquire Ziddu.com was announced.
“It’s crazy… the global euphoria over Blockchain is sweeping the world…no intrinsic value can be attached,” said Venkata Srinivas Meenavalli who backs LongFin Corp and also the founder of Meridian Tech Pte. “In lieu of their holding in Meridian Tech, Bachchans received 250,000 shares of LongFin following the asset purchase,” Meenavalli told ET.
So, the investment of $150,000 from Amitabh Bachchan’s account and $100,000 by the joint account of Amitabh Bachchan and Abhishek Bachchan, surged to $17.5 million. But not for very long, Bitcoin shot above $19,000 for the first time on December 17, registering an all-time high this year on Coinbase Inc. Thereafter, the popular cryptocurrency sharply plunged to as low as $13,250 on December 22, just in seven days.
Since company’s shares rode on the wave of Bitcoin mania, with the plunge, its shares tanked too; wiping out the most of the gains made by the Bachchans — in just seven days.
Cryptocurrency vs Blockchain vs Bitcoin
Cryptocurrency: Cryptocurrency is a digital currency in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds.
Blockchain: Blockchain a technology in which transactions made in digital currencies are recorded chronologically and publicly. Blockchain as a technology supports Bitcoin trading, but it not synonymous with Bitcoin. Blockchain can be used for a wide variety of applications, such as tracking ownership or the provenance of documents, digital assets, physical assets or even voting rights.
Bitcoin: Bitcoin is a type of cryptocurrency, which operates on the encryption technique, but does not have a legal backing from the central bank. It is an unregulated digital private currency created by Satoshi Nakamoto in 2009.