Lemonade (NYSE:LMND) certainly isn’t the first company you think of when you think crypto. It’s a better fit when thinking about renter’s insurance, term life insurance and the like — things the company has been offering since its inception. But, Lemonade is expanding into the blockchain space this week with a new announcement. LMND stock is gaining on the news.
So what do you need to know?
Lemonade is a newer kid on the insurance block, but it has quickly built up a devoted following. That’s because it has carved out a niche of young customers — its clientele majorly skews toward those under 35 years old. It also takes a unique approach to the claim filing process, using artificial intelligence (AI).
Unfortunately, the company has seen its fair share of woes since its initial public offering (IPO) in 2020. Shares have tumbled sharply from all-time highs, bottoming out below its IPO price of $29.
Now, the company is working to combat volatility through crypto.
How? An announcement today sees Lemonade forming partnerships with some of the biggest blockchain projects in the world in an effort to alleviate issues inflicted by climate change.
Lemonade (LMND) Stock Gains on New Crypto Partnerships
Lemonade is looking to boost interest in LMND stock through an entirely new venture into the ever-trendy world of digital money. More specifically, the company is looking to reduce the effects crypto has on climate change through its own initiative. This initiative includes the establishment of a Lemonade crypto coalition.
Essentially, the company announced it is establishing the Lemonade Foundation. This new organization will see Lemonade tap blockchain technology to reduce negative effects of global warming. Its first step in doing this is through the organization of the Lemonade Crypto Climate Coalition (L3C). L3C will, according to a press release, be instituted as a decentralized autonomous organization (DAO). This structure gives all participants a say in how the coalition proceeds with its goal.
The first major project L3C is undertaking is in helping African farmers. Lemonade says insurance companies often are dissuaded from providing their services in emerging markets due to a lack of reliable weather forecasts. This keeps the companies from knowing about potentially devastating weather events before they happen.
To alleviate this issue, Lemonade is partnering with several blockchain companies including Chainlink (LINK-USD) and Avalanche (AVAX-USD). These partners will use blockchain oracles to quantify weather risks in low-infrastructure areas in real time. Lemonade will then be able to use this data alongside its AI claim assessment capabilities to produce weather insurance products for farmers in underserved countries.
The new effort is a valiant one, and an interesting pivot for the company as it looks to get back on its feet. LMND stock is benefitting from the news today as well; shares are up 6% amid the announcement.
On the date of publication, Brenden Rearick did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
