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

tZero Affiliate BSTX Seeks SEC Permission to Launch Security Token Trading Market Based on ETH

An Overstock’s tZero affiliate is looking for legal jurisdiction to instigate a market where registered security tokens will be traded publicly.

On Friday, the Securities and Exchange Commission unleashed a rule change proposal that will authorize Boston Securities and Token Exchange to come up with an equity trading platform. It will be automated and have its ownership documentation stored on the ethereum platform. BSTX is, however, going to list the securities tokens that are full-fledged.

This is unlike tZERO, which owns 50 percent of the shares. tZERO handles the exempt security tokens from SEC registration requirements, and its trading platform was launched in January. The 129-page rule change proposal by SEC that was unleashed on Friday gives a clue of how this proposed exchange will come to run one day.

The exchange would be based on the ethereum blockchain and would be updating their ownership records every single day after the close of trading activities. The people responsible for approving wallet addresses, wallet managers, would have to cover the gas bill to send their daily dealings to the ethereum blockchain. However, the exchange believes that this amount will not be that significant.

Acknowledged Addresses

Listed tokens on the exchange would have to be in tandem with the ERC-20 standard. They should also have additional security standards in the protocol. The security measures ought to be indicated by three smart contracts to track whitelisted addresses, ownership, and compliance with set rules.

BSTX proposes to be operational for trading between 9:30 am and 4:00 pm eastern, just like the two central stock exchanges NASDAQ and NYSE at Wall Street. The rules proposed for this platform resemble the traditional exchange rules that are already in place. Many people will ask how they will determine who is making trades and whether they are even allowed in the first place.

With the traditional markets, the Financial Industry Regulatory Authority assigns a participant with an ID (MPID). The firm is a self-regulatory organization. But for BSTX, the users will use an authorized wallet address to identify themselves.

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Author: Daniel W

tZERO Teams Up With Entertainment Financing Startup BLOQ FLIX To Tokenize Films

Overstock’s subsidiary in charge of tokenizing securities, tZERO has partnered with entertainment financing firm BLOQ FLIX to come up with a technology service which will help BLOQ FLIX to tokenize its financing options in the entertainment industry. The partnership means that the tokenization will be done using tZERO’s protocol technology.

According to Yahoo Finance, the partnership dubbed ‘ Blockbuster meets blockchain’ the two companies will create a fresh film financing mechanisms for television, studio initiatives as well as the internet. Through the tZERO tokenization platform, BLOQ FLIX is set to make it easy for investors to take part in the financing process.

tZERO CEO Saum Noursalehi expressed his gratitude on the partnership saying that the two companies will be able to provide secure and innovative investment options to finance film projects. Noursalehi added that his company’s aim is to tokenize as well as trade assets which have the potential to benefit from blockchain technology and the tokenization of film financing is a step towards the realization of tZERO’s goals.

Brandon Hogan and Jonathan Helmuth are BLOQ FLIX’s founders who have immense experience in financing entertainment projects and the duo has managed to raise about $100 million worth of production funds and have directly been involved in more than 150 entertainment projects.

Hogan, who is BLOQ FLIX CEO, has worked in the film industry for more than 25 years. The CEO said that the financing modalities in Hollywood need to evolve and his company is taking the front seat in disrupting how the conventional media is financed. The CEO said that through embracing blockchain technology, the two firms will be able to streamline the film funding process as well as provide access to funding to small studios and producers.

Brokerage firm, JumpStart Securities, will act as the placement agent for the offerings provided by the two firms.

Jonathan Self JumpStart CEO stated that the partnership will allow BLOQ FLIX as well as other investors to change the way media content is financed.

According to CoinDesk, tZERO revealed in July that it was in the process of raising about $40 million in funding for Biopic, owned by Atari founder, together with film production as well as financing firm Vision Tree.

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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

Tokenized Securities Can Be Settled on tZERO’s Public Blockchain, Following Patent Win

Tokenized-Securities-Can-Be-Settled-on-tZEROs-Public-Blockchain-Following-Patent-Win
  • tZERO can now settle transactions involving tokenized securities on a public blockchain ledger.
  • The tech platform is a subsidiary of Overstock.

Overstock’s tZERO platform makes it possible to participate in security token trading, and they’ve been making progress in their presence in the cryptocurrency industry lately. According to The Block, the subsidiary has just been granted a new patent that allows tokenized securities to be settled on the public blockchain directly.

tZERO announced the news on Tuesday, saying that the new technology will record trade data, along with the on-chain settlement data. The tech, which is being called Time Ordered Merkle Epoch (TOME), will post these details to the public blockchain ledgers. The use of TOME will also create a record of transactions that is fully immutable and auditable.

CEO Saum Noursalehi stated,

“It can be used in our suite of products, as well as licensed to companies across various industries that are seeking to maintain a tamper-proof and auditable record of time-series-based data.” Noursalehi added that the announcement shows the company’s “technological leadership in blockchain innovation.”

This is not the first patent that tZERO has gotten this year. Earlier in 2019, the platform secured a patent to create a “Crypto Integration Platform,” which makes it possible to merge cryptocurrencies with the legacy trading systems.

tZERO was founded in 2014, aiming to use blockchain technology as a way to change up Wall Street and the traditional financial market.

[Author Alert] The author’s opinions above are solely based on their own self-conducted research. Assume any and all authors are using, holding, trading and/or buying cryptoassets mentioned as a portion of his or her financial portfolio. Use information at your own risk, do you own research, never invest more than you are willing to lose.

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Author: Hank Klinger