Shareholders of Canada One Mining Corp. (TSX-Venture:CONE) hit the buy button on news that the company had initiated a strategic review of their existing portfolio of assets in the Province of British Columbia, with a view to reducing carrying costs and consolidating existing mineral assets into a package which can be more easily advanced.
In connection with that review, the board of directors also intends to evaluate potential strategic acquisitions for the Company, as well as potential transactions in the blockchain and cryptocurrency sector, to determine whether such transactions are in the interests of shareholders.
Now to be fair, the company basically stated that its current business model needs tweaking and since the investment flavour of the month continues to be blockchain and cryptocurrencies, officials will look into that sector to see if they can build a business around that.
Further into the press release, the company stated, "at present, management of the Company remains committed to the development of the Company's core assets in British Columbia. While a review of potential acquisitions and transactions within the blockchain and cryptocurrency sector is ongoing, there can be no assurance that any transactions within this sector will be consummated or will receive the required regulatory approvals."
So, basically the company was looking to re-energize a sagging and quiet mining stock by providing shareholders with an ounce of hope that they MAY get into the blockchain and cryptocurrencies industry. Shareholders ate the news up like candy by sending shares of CONE up 79.17% at last check in mid-afternoon trading on the highest trading the stock has had in close to 10 years.
Let’s be reasonable. The company could pivot to blockchain and cryptocurrencies in the near future, and in that case, if the sector continues to be hot and the company executes correctly, this could turn into a gem.
However, the likelihood of all those things happening perfectly are quite slim, and what’s more likely was the company was looking for a quick pop in their stock price, and they knew what lever to pull. Are cryptocurrencies in a bubble? It’s announcements like this that make us wonder how it’s possible that it isn’t?