What happened
Shares of Chinese live-streaming platform operator Scienjoy Holding Corp. (SJ -13.41%) were trading more than 55% higher as of 11:55 a.m. EDT Tuesday after the company announced a new strategic alliance with Snipp Interactive (SNIP.F -3.37%).
So what
Scienjoy is partnering with Snipp, which helps its corporate clients run their loyalty and rewards programs, to develop two major initiatives. The first will be a new rewards system that will enable Scienjoy broadcasters and users to earn more points on its platform, which they can then exchange for digital awards.
Scienjoy and Snipp will also explore ways to allow Scienjoy users to create their own non-fungible tokens (NFTs), which are digital files such as art, video, and audio, stored on a blockchain -- the same digital ledger technology that underpins cryptocurrencies.
Image source: Getty Images.
The overall goal is to enable Scienjoy users to use the points they acquire through the new rewards system to purchase NFTs made from snippets of their favorite broadcasters' live-streams.
"With approximately 250 million users and 300,000 broadcasters across our ecosystem, we are well-positioned to help our partners increase their outreach efficacy," Victor He, chairman and CEO of Scienjoy, said in a statement.
Now what
The steep gains of Scienjoy and Snipp, which was also up by more than 23% Tuesday morning, were likely fueled by the NFT news. Investors have been pouring money into NFT stocks as the market for the digital assets has exploded in recent months.
However, NFTs are a very new and risky asset class. Most NFT-related stocks have been incredibly volatile, and I would expect the same from Scienjoy, so invest with caution.