After two decades of selling furniture, décor and anything in between, Overstock is finally selling off its retail business. And it’s doing this so that it can focus on cryptocurrencies and blockchain technology, the CEO revealed today. At a time when cryptos have experienced a bloodbath, Overstock’s decision to go all in will give many in the industry hope that the fortunes could turn as we head into the festive season. On the announcement of the new business path, Overstock’s shares surged 26 percent, a clear contrast to the performance of the crypto market today. The sale of the retail business is expected to be completed by February 2019.
All In On Crypto
Founded in 1999, Overstock served as a marketplace for surplus and returned merchandise at a time when online shopping was at a nascent stage. With time, its selection of goods has grown and is today the stockist of jewelry, kitchen appliances, clothes and apparel, furniture and more. However, the company’s founder and CEO, Patrick Byrne believes that cryptos and blockchain are the future, and he is going all in.
In an interview with the Wall Street Journal, Byrne revealed that the sale, which had previously been revealed, will go down by February next year. The possible buyers or the value of the sale were however not disclosed. And the reason the company’s doing this is that it intends to fully focus on its crypto ventures.
The shares of the Salt Lake City-based company surged 26 percent following the announcement. Despite the price rally, the shares are down 70 percent for the year from their January high of $80 and currently trade just above $20.
Overstock has been investing in blockchain startups through its wholly owned subsidiary, Medici Ventures. Founded in 2014, Medici has been Byrne’s pet project and he has injected $175 million into the firm, but it’s yet to turn a profit.
Medici has invested in multiple blockchain startups, one of which is Voatz. Voatz is a blockchain-based mobile voting system, perhaps best known for its use in the West Virginia midterm elections. Medici has also invested in Bitsy, a crypto exchange and wallet; Factom, a data processing platform; Settlemint, an enterprise blockchain provider and tZero, a trading platform aimed at invading the capital markets.
As reported by WSJ, tZero is yet to be launched commercially and is operating at losses, but this does not bother Byrne as he fully believes in its long-term potential.
I don’t care whether tZero is losing $2 million a month. We think we’ve got cold fusion on the blockchain side.
Overstock has been one of the most ardent believers in cryptocurrencies, and among the earliest merchants to accept Bitcoin as a payment method. However, like many other companies with ties to crypto, its shares have taken a beating this year as cryptos have tumbled. However, Byrne revealed to the company’s investors two months ago that the company doesn’t have significant holdings of Bitcoin. At a time when investors are having their faith tested by the tumbling market, the nod by Overstock is a welcome reprieve.