Overstock has indicated it will, from next year, dive deep into the blockchain space after realizing its potential in turning the company finances back on track.
Patrick Byrne, CEO, Overstock, said that the e-commerce store will sell its retail unit by February 2019 although he did not quote any specific buyer.
The e-commerce store was born in 1999 with Patrick betting on the internet to sell jewelry among other things. After almost 20 years, the CEO is shifting his bet and placing it on the distributed ledger technology that holds cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), etc.
His ambitions on the blockchain sector will be driven through Medici Ventures, a blockchain start-up owned by Overstock and in which the e-commerce store has already pumped in 175 million U.S dollars.
However, from the balance sheets of Medici Ventures, since being founded in 2014, it has recorded losses to a tune of 61 million U.S dollars. Its parent company, Overstock, has also not been a stranger to losses seeing it has recorded a net loss of 163 million U.S dollars in 2018.
Another Overstock-backed start-up, tZero, is also not any better in terms of finances. But Byrne says:
“I don’t care whether tZero is losing $2 million a month. We think we’ve got cold fusion on the blockchain side.”
Some of the start-ups affiliated to Overstock are developing a smartphone application that supports voting on the blockchain.
Overstock’s share price has been moving proportionately with the highs and lows in the cryptocurrency market. For example, its share price rose by 400% when the price of cryptocurrencies like Bitcoin rose to almost $20K by the end of last year and surged to 80 U.S dollars in early this year. The share price is trading at lows of 18 U.S dollars.
Whether its decision to dive deep into blockchain will change the state of affairs is something to look out for.
Do you think investing in blockchain related projects can be a profitable venture for many traditional businesses?
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