Company with no useful product worth $6 billion baffles experts
11 Jul 2014
A company with apparently no useful products is worth $6 billion today, with many people baffled at its rise, Digital Journal reported.
CYNK Technology, a company with assets worth $39 has seen its share price rise dramatically in the past week, hitting a valuation of about $6 billion in a matter of days.
At its 52-week low the firm was valued at about $18 million.
Despite having a valuation exceeding that of Groupon, CYNK was an unknown in the technology world. According to commentators, it was actually not a real business. The tech firm appeared to be operating a scheme to bounce its shares up by swindling those who bought into the company at inflated prices to the benefit of those orchestrating it.
According to the company's most recent quarterly report it lost $6,241 on revenue that appeared to be zero. The company recently moved its headquarters to Belize City, Belize and the largest loss appeared to be 'professional fees'.
CYNK has been recently pushed by ''paid promoters,'' a claim that made logical sense, according to media sources, however it also appeared to be using social media to boost the value of its shares, which did not appear to do much. It looked like a classic pump-and-dump scheme to analysts of the tweets and the stock prices.
The company had no assets, no revenues and no business plan to speak of, AFP reported.
Wall Street analysts had not been able to explain the spectacular 24,000 per cent increase in Cynk, which traded on the lightly regulated over the counter (OTC) market.
"We must sadly conclude that the company is nothing but a fraud," said the financial news website Zero Hedge.
"And it is nothing short of a testament to just how broken this excuse for a market is that a company with no assets, no revenues, no website and one employee can go from zero value to nearly $5 billion in market cap in a few days."
The stock trading at six US cents on 16 June saw an unexplained rise to $2.25 the next day, and $16 on Thursday, before slipping to around $14 at the close, which made its paper value still an eye-popping $4 billion or so.
The company had been able to avoid scrutiny until its disproportionate value drew the attention of Wall Street veterans.
The phone number listed on company documents is out of service and according to Richard Green of the market analysis firm Briefing.com, its regulatory filing indicated Cynk had no assets, no cash and an accumulated loss of $1.5 million.
