Overstock’s Crypto Trading Subsidiary, tZERO, Hits Record High Volumes in August

  • tZERO, the crypto trading app backed by retail giant Overstock, has announced new record volumes in August.
  • This digital securities platform noted that both their crypto trading app and blockchain-built alternative trading system (ATS) experienced the highest activity since they were launched back in June 2019.

The month of August saw tZERO’s user base grow by 11% compared to July, marking an increase of more than 1,000 new users on the digital asset app. Notably, this year has been relatively bullish for tZERO with a total of 143% growth in user base since it began. The platform is now looking to give traditional brokers a run for their money when it comes to offering digital securities trading services to Wall Street.

Going by last month’s stats, tZERO’s digital asset app grew by around threefold in traded dollar volumes. The reported figure, which is $22 million, is a jump from July’s $7.6 million, while the year-over-year growth stood at 684%. Saum Noursalehi, the CEO of tZERO, further highlighted significant milestones by the project,

“In addition to delivering record trading volume on the tZERO ATS in August, the St. Regis Aspen (ASPD) digital security began trading … These wins, coupled with FINRA’s approval of tZERO Markets, are exciting, and we look forward to offering our crypto customers the opportunity to open brokerage accounts at zero Markets.”

The platform is now incentivizing activity with its recently rolled out zero-fee structure for publicly-traded digital securities; private ones, however, retained the previous fee structure. Nonetheless, the project is not yet out of the words when it comes to product scaling and attracting heavyweight investors to compete favorably against traditional brokerages.

Apart from the crypto trading app, tZERO has been actively involved in the tokenization of assets, not limited to real estate and film productions. It is also quite noteworthy that Overstock began accepting BTC payments as early as 2014, giving the retailer a head start in the space.

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Author: Edwin Munyui

Overstock’s Security Token Platform To Launch Retail Broker-Dealer tZERO Markets By Mid-Year

tZERO is a security token platform operated by Overstock, the online retailer. On January 30, 2020, the platform released a summary of its business performance in the form of a review letter. The letter provided a summary of everything from 2019, including providing a detailed layout of what they intend to achieve in the course of this year.

Saum Noursalehi, the tZERO CEO, is behind the penning of this review letter which focused on various aspects of the business including an anticipated introduction of the broker-dealer program, which is also being referred to as the tZERO markets. The review states that this release is expected to occur “in the first half of this year.”

Funding from External Sources

At the same time, the company also made known their plans to approach external sources for additional funding. This is something they expect to accomplish later this year or in the beginning of next year.

tZERO was founded in January 2019. In May of the same year, they received a total of five million dollars from GSR Capital. However, tZERO still managed to miss their initial fundraising goal by a whopping 98.7 percent. In the review letter, Noursalehi wrote that:

“As Overstock management mentioned recently, it is committed to funding tZERO. As our business continues to develop in the first half of the year and we continue to hit milestones and prove out the business model further, it may become appropriate to approach external sources of capital in late 2020 or 2021.”

The Chief Executive Officer was, however, quick to point out that the only time that the platform will take this measure is when they’re sure that the funding obtained from external sources will help to enhance the company, as well as the value of its stakeholders.

tZERO was in hopes that it would manage to list at least 5 security tokens on the tZERO ATS exchange by the end of last year. But this process was delayed by various regulatory and legal concerns.

Noursalehi pointed out that the exchange currently has one broker-dealer and 2 listed tokens.

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Author: Daniel W

Overstock Shareholders Stake Their Claim To Lead Class Action Lawsuit Over tZERO Controversy

Overstock, an e-commerce giant that ventured into the decentralized space with its tZero platform is at the center of a class-action lawsuit filed against it on September 27 this year. The lawsuit accuses Overstock of security fraud and the firm is currently facing 5 cases against it. Several investors this week filed their motion to consolidate on these cases.

A total of 8 former and current shareholders have expressed their desire to lead the lawsuit which includes the likes of Cohen Milstein Sellers & Toll PLLC, Block & Leviton LLP, Bragar Eagel & Squire PC, Glancy Prongay & Murray LLP, and Kahn Swick & Foti LLC, Levi & Korsinsky LLP, Pomerantz LLP, Bernstein Liebhard LLP.

Benjamin Ha from Block & Leviton LLP claimed that Overstock purposely created a tZero platform to punish short-sellers who sold their Overstock shares. Overstock’s shares have been on a continuous decline along with its dominance in the home goods e-commerce market.

Investors claim tZero was created to artificially inflate the Overstock share price

The lawsuit claimed that Overstock’s dismal performance in its e-commerce market along with declining share prices forced the firm to create a tZero exchange to give it’s business some more time.

Ha claimed that the firm has been struggling to keep up with Wayfair.com and hasn’t recorded any profit in the past three years.

“According to the suit, in September, investors discovered that the company “had engineered the tZERO offering as revenge upon short-sellers and tried to create a short squeeze by offering a digital token dividend that would not be registered and could not be resold for at least six months.”

The tumbling of Overstock shares

The firm had put a tZero digital token dividend lock because of which short-sellers couldn’t hand off their stock even after selling their shares. tZero did rise as high as $27 at one point but soon the investment banks declared that they would not accept the tZero dividend and instead accept cash. The news tumbled the price of the crypto token and Overstock promised to register their stock to end the lockup.

The problems started to creep up right after that, The first company’s CEO Patrick Byrne resigned from his position and liquidated $90 million worth of his Overstock shares. Then the very next month in September when the firm presented its financial report, it was found that the firm misrepresented its financial prospects which tumbled their share prices by 50%.

Byrne stated that the main cause of his departure was not being able to get corporate insurance. He explained,

“The proximate cause for my departure was, in fact, the impossibility of our getting corporate insurance with me still at the helm. Just as we learned in Game of Thrones that behind the scenes the Iron Bank makes the big decisions, in Corporate America insurance companies get the last say.”

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Author: James W

Overstock Rolls On State-of-the-Art Blockchain R&D Campus In Ireland, Over $1.1 Million Invested

US e-commerce and tech giant Overstock has announced that it has established a blockchain research and development center that will be based in Ireland.

In a press statement issued on Oct. 9, the company revealed that the new R&D base will be situated in ‘IDA’s flagship North West business park in Sligo’. The statement also stated that the center will employ its hundredth employee who will be Irish before the end of the year. At the moment, the center boasts of approximately 80 technologists.

The press statement also stated that the new R&D center in Ireland is worth more than €1 million ($1.1 million). According to the firm’s vice president who also doubles as the site head, David Kenny, the company was excited with the opening of the new center that will see all the teams under the same roof. Kenny explained that the new center was a validation of Overstock’s preference of the North West as a friendly area for business and the creation of high-performance teams for software development.

He added that the blend of varied career paths as well as high-quality tech environment coupled work-life balance had gone won excellently with the techies. This, he stated, was an added incentive for the numerous individuals who have continued to be part of their team.

Here is his exact quote:

“We’re absolutely delighted with our new home and getting all our teams back under one roof. It further validates Overstock’s choice of the North West as a great place to do business and build high performance software development teams. The combination of a diverse career path, a cutting edge tech environment and a great work life balance has really resonated with the techies who continue to join our growing team.”

The press statement was also categorical in that the new center will not only focus on blockchain but also on emerging innovations within the e-commerce sector as well as the machine learning domain.

Despite the opening of the new center, not all is smooth with the company. The tech giant is embroiled in a controversy which has contributed to negative effects on its reputation. A fresh complaint has been filed in Utah alleging that the immediate former Overstock CEO, Patrick Byrne as well as the former CFO Greg Iverson were in the middle of a securities fraud. In this case, it remains unclear whether the opening of the new R&D center will add to the company’s fortunes.

Cointelegraph reports that Overstock is following in the footsteps of IT firm Cisco which opened an innovative center in Singapore in February that also focuses on blockchain.

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Author: Joseph Kibe

Following Patrick Byrne’s Exit, Overstock Will Change Former CEO’s Crypto Dividends

Overstock, a giant of the retail industry, has recently decided to drop the originally intended restrictions for its digital dividends. This happened because of trouble with the former CEO of the company Patrick Byrne.

Byrne left the company after a scandal which was said to involve a romantic affair with a Russian spy. However, before he left his position, he arranged so that the dividends of the year would be paid using a digital security listed on the company’s subsidiary tZERO.

Now, however, as he left the company, Overstock decided that it was better to restructure some of the ways that dividends would be paid in order to make the experience more seamless. In order to do it, the company has put the dividends on hold. Overstock will need time to set everything right, though, which is why the decision of freezing the assets for the moment was taken.

According to the official statement of the company, Overstock is working with the authorities in order to provide more liquidity and to structure the dividend shares in a way that they bring the most benefits to investors.

Originally, part of the dividends were paid in the way that the Byrne was structured, was to make short sellers move away from the firm. Byrne believed that people were shorting Overstock. Initially, as he presented the new payment structure, the price of the shares went up. However, after that, they went down again as some banks started to accept them.

Now, the company is working on the restructuring of the whole system to cater to the needs of the investors.

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Author: Gabriel Machado

Overstock Loses Investor in tZERO Days After The Departure Of Founder Patrick Byrne

Overstock interim CEO Jonathan Johnson, in an investor call on Monday with shareholders offered an update on the status of Makara Capital’s probable investment tZERO, the company’s security token exchange, Cointelegraph reports.

As per the interim CEO, Makar has said that it will no longer be investing in tZERO in the near future but it remains optimistic of what tZERO is developing and hopes to revisit its investment decision as tZERO continues with its build-up.

Late in March this year, Overstock revealed that Makara Capital and GSR Capital were set to invest $101 million equity and the deal was set to be inked in April. However, the company issued an update in April saying that negotiations were still ongoing stating that it was not under any exclusivity with Makara or GSR and has retained advisors to pursue parallel alternatives.

The move by Makara Capital comes just days after the departure of Overstock’s long serving CEO Patrick Byrne who resigned citing his admission of a romantic relationship with a Russian informer who is currently in prison.

Makara’s departure after several months of conducting due diligence on tZERO and it appears that the dwindling returns seems to be a major aspect of the company’s departure.

During the investor call, Johnson reteriated Overstock’s commitment to blockchain business. Johnson said that Patrick’s departure will not change the company’s focus on blockchain business. Johnson said that the company’s shareholders and others can be assured that the new management will continue to nurture and grow the blockchain team in the business and the businesses currently in the Medici Ventures family.

On the news that the SEC is investigating tZERO and its potential security token sale, the company’s General Counsel, Glen Nickle, stated that the firm will continue to cooperate with the SEC.

Adding that tZERO is meeting with SEC on a weekly basis and SEC will communicate on its focus and the matter will be resolved amicably. Overstock shares have tumbled by about 10% since the departure of Patrick Byrne.

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Author: Joseph Kibe

Renowned Crypto Advocate, Patrick Byrne, Hangs His Hat Up As Overstock CEO in Light of ‘Deep State’ Comments

Renowned crypto champion Patrick Byrne has announced his resignation as Overstock CEO. Byrne was a rare ardent crypto worshipper despite leading a public US company.

In a letter to the shareholders on Thursday, Byrne said he was stepping down as the CEO of the company and also as a member of the board of directors as a result of insurability. Byrne also cited that his romantic relationship with Maria Butina, a Russian agent who is currently serving an 18 months jail time after she pleaded guilty of working as a foreign agent was part of the reason he was resigning.

Byrne’s position will be taken over by Johnthan Johnson in an interim capacity. Johnson is currently the president of Overstock’s blockchain venture Medici Ventures, said a press statement released by the company.

In an acceptance statement, Johnson praised Byrne as a visionary leader who was ardent about innovations and whose under his 20 year tenure the company had achieved greater heights. Johnson said it will be his mission to continue building Overstock’s achievements as well as success.

Johnson stated that he was confident that the company’s future was bright both in retail as well as blockchain.

On his part, Byrne stated that having worked with Johnson for a long time, he had no doubt that Johnson was ready for the job and will successfully oversee both the retail as well as the blockchain businesses.

During his reign as Overstock CEO, Byrne made the company crypto friendly, including the starting of tzero, the company’s crypto token platform. He also made the company to accept Bitcoin as a mode of payment.

Cointelegraph reports that in an acting capacity, Johnson will still serve as a member of the board of directors for both Medici Ventures and the company’s security token trading platform tZERO, as well as act as president of Medici. Meanwhile, Kamelia Aryafar will take Byrne’s place as a board member and executive vice president of Overstock Retail.

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Author: Joseph Kibe

Overstock Blockchain Company tZero Launches New Security Token ‘TZROP’

tZero, the blockchain subsidiary of Overstock, the retail giant, has recently launched its TZROP tokens, which will be equity security tokens. With the token, the holders will have a way to get profits from the company.

What is more interesting is that the token will be available for both accredited and non-accredited investors, meaning that people who are not rich will also get a shot for investing in the new crypto product.

If you hold the tokens, you will get 10% of the company’s profit quarterly. The 10% will be equally divided by all the tokens and people will get an equivalent amount of money. The idea is that this could put small investors in touch with the profits of the company.

However, in order to really sell the tokens, the company is still awaiting the final approval, which will need to pass the Board of Directors and the law requirements of the state of Delaware.

Interestingly, the dividends can be paid not only in USD but also with cryptos such as Bitcoin (BTC) and Ethereum (ETH).

tZERO’s CEO Saum Noursalehi affirmed that the new security token is an important milestone in order to turn the capital market into something more democratic. According to him, non-accredited investors are generally not able to be a part of these investments, which excludes them from the market.

With this new offering, he believes that the market will continue to be properly regulated at the same time that more people will be able to invest in it. This will create more liquidity for everybody and also more wealth to people who simply were not able to invest in this profitable market before.

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Author: Bitcoin Exchange Guide News Team