- Bluesky Digital stock rose 10x in the past week.
- Investor confusion was likely the cause of the price surge.
- Cryptocurrency stocks have soared since Donald Trump’s election victory.
What’s in a name?
For Bluesky Digital, that’s a share price increase of 1,767% over the past month.
In a case of poor name recognition, the stock price of Toronto-based blockchain company Bluesky Digital jumped in November as investors may have confused it with social media platform Bluesky.
Since Donald Trump’s election on November 5, Bluesky Digital’s stock price has risen from $0.06 to $0.56, or approximately 833%.
The stock movements take place in a context of an increase in the number of users of the Bluesky platform.
A portfolio manager told Bloomberg that the stock price rise “could be due to a name confusion” with the social media platform.
At the request of Canadian regulators, Bluesky Digital clarified in a filing that these measures were not linked to securities transactions.
The blockchain company said that “management is not aware of any material changes in the Company’s operations that would explain the recent increase in market activity.”
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The rise in Bluesky Digital shares has coincided with the appeal of its namesake among social media users, particularly former X users.
Coincidentally, Jack Dorsey, co-founder of Twitter, the former name of X, also co-founded Bluesky, the social media platform.
Market watchers say people who left X to join Dorsey’s Bluesky are unhappy with the platform, as well as some who balked at Elon Musk’s role in supporting Trump.
Musk, CEO of SpaceX and Tesla, acquired Twitter in 2022 and changed its name to X the following year.
Musk’s critics say X has become a platform overrun by bots, fraudulent ads and extreme content.
Bluesky’s user base has grown to over 20 million – the platform had 6 million users three months ago. Much of this growth has occurred since Trump’s election victory earlier this month.
Part of the confusion for investors might lie in their shared decentralized technology goals.
Cryptocurrency-related stocks have risen significantly since Trump’s election victory. MicroStrategy, the company with the largest Bitcoin balance sheet, has hit a new all-time high stock price for the first time in 20 years.
Adding to the confusion: the trading symbol for Bluesky Digital, which allows businesses to adopt web3 technology, is BTC. BTC is also the symbol for Bitcoin.
Meanwhile, Bluesky, the social media platform, is developing a blockchain-based network for social media platforms.
The network aims to create a federated social media structure that would allow users to create an infinite stream of social media microsites within Bluesky’s open source network.
Since it is a federated system, each micro social media site can be populated by existing Bluesky users without any additional steps.
Osato Avan-Nomayo is our DeFi correspondent based in Nigeria. It covers DeFi and technology. To share tips or story information, please contact him at osato@dlnews.com.
