Overstock going all in on blockchain and cryptocurrency
"We think we’ve got cold fusion on the blockchain side."
Overstock.com CEO Patrick Byrne has been an outspoken proponent of cryptocurrencies and blockchain technology, and has recently decided to decisively put the company's money where its brand mouthpiece is. The company has plans to sell off the retail side and focus solely on blockchain technology through its wholly-owned Medici Ventures arm, Wall Street Journal reported last week.
It's been part of the plan since at least 2017, WSJ says.
Cold fusion... on the blockchain
The decision to focus on blockchain reportedly hasn't been especially profitable yet. On the contrary, Overstock properties, such as tZero, are burning millions of dollars a month.
Starting in 2014 with a $175 million investment, Medici Ventures lost about $22 million last year, and about $39 million in the first three quarters of this year, according to company filings. Overstock itself is similarly running at a net loss of $163 million in the first three quarters of this year.
Byrne remains unfazed though.
"I don't care whether tZero is losing $2 million a month," Byrne told the WSJ. "We think we've got cold fusion on the blockchain side."
If blockchain technology does live up to Byrne's expectations, cold fusion might be an appropriate analogy. tZero is a modular platform for security token trading, which can handle every step of the process. Other Medici ventures include a diverse range of startups, which might give wide coverage of emerging disruptions.
These include the Factom blockchain data tracker, the Bitsy crypto wallet and exchange, and many more specific applications – some of which might live and trade through tZero someday. Some examples include the VinX wine futures platform, which lets wineries streamline their funding by selling wine futures directly to future customers and investors, and the Symbiont ledger for securities tokenisation. Others might be a bit further down the line, such as the Voatz blockchain election app.
Byrne also has some personal holdings in different cryptocurrencies, including the once-enigmatic Ravencoin project – which has found itself moving into the spotlight since Byrne mentioned his holdings. The most recent feather in Ravencoin's plumage has being the first coin to receive a coveted zero-fee listing on Binance.
Overstock share prices rose over 25% on Friday as news of the shift broke, although its stock is still down 66% this year.
Even though Byrne has told traders that Overstock does not have significant bitcoin holdings, its share prices have tended to broadly mirror the crypto market anyway. And with its fortunes so closely tied, why not go all in?