Overstock is gearing up to sell its retail business, with a deal taking place in the next few months as it focuses solely on its blockchain initiatives.
CNBC, citing comments Overstock chief executive Patrick Byrne made in an interview with the Wall Street Journal, reported the sale could happen as early as February. Overstock has previously announced plans to sell the retail business so that it can focus on blockchain technology. Byrne is a big backer of blockchain and cryptocurrencies. He wouldn’t name the buyer or potential buyers, noted the report. News of the impending sale did boost shares of Overstock, with CNBC noting the stock gained 26 percent late last week. Still, shares are off more than 65 percent since the start of 2018.
Overstock has been focusing much of its attention on Medici, the blockchain company that it has invested $175 million in over the years. The unit has been burning cash since launching in 2014, noted CNBC. For the first three quarters of 2018, it lost around $39 million. That compares to $22 million of losses in 2017, noted the report. Overstock has a net loss of $163 million for the first three quarters of 2018, reported CNBC. “I don't care whether tZero is losing $2 million a month,” Byrne told the Journal. “We think we've got cold fusion on the blockchain side.”
Medici acts a home for startups and not only cryptocurrencies. Voatz, for one example, developed a voting system via smartphone app that runs on blockchain, while another, out of Rwanda, is using blockchain to handle digital property rights, noted the report. “We believe [tZERO] is leading the pack globally in possibly the most lucrative of all blockchain applications (i.e., security tokens). I think the public may not understand our master plan in Medici, how the pieces all fit together, as well as how blockchain firms in this network are making similarly dramatic progress in their respective fields,” Byrne said in a recent letter to investors.