Overstock is still a retailer but it wants to be a blockchain company

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Patrick Byrne, the CEO of Overstock and a blockchain evangelist has made no secret of the fact that he wants to run a blockchain business, not a retailer. But investors aren’t exactly sure what that means.

“It’s still confusing to most people — even our own investors. Very few have done their homework,” Byrne told CNN Business on Friday.

That’s why Byrne said he plans to give a lot more detail about the big picture plans for Overstock’s blockchain businesses when it reports its latest earnings sometime in March.

The company has made some moves into blockchain over the past few years.

It launched the Medici Ventures investing firm to focus on blockchain technology, a public digital ledger of transactions, and it is also developing its own tZero security tokens for e-commerce and trading.

With some of the previous announcements, like the one to CNBC in December 2017 that the goal was to reorganize the core Overstock business to go in full on blockchain within 60 to 90 days, investors might seem to be reasonable to be a bit skeptical.

The CEO reiterated his plan to get out of online retail last November, telling the Wall Street Journal he hoped to have a sale done by this February. Investors seem to believe him.

Shares of Overstock (OSTK) have shot up more than 20% since then, even as bitcoin (XBT) prices have tumbled nearly 15% during the same time frame.

Some market watchers believe that it is not about whether or not Overstock goes towards blockchain but who intends to buy the company. There are rumors that Walmart would have interst, if for no other reason than to better compete with Amazon. However, Overstock shares have pulled back sharply as Byrne’s February target draws near without any sign of a deal being imminent. Overstock fell 9% on Thursday.

“It does not surprise me that nothing has happened yet,” said Bill Baker, an analyst with GARP Research. He notes that retail is a notoriously tough and competitive business and that Overstock has been losing money in it.

A sale for Overstock’s retail business could still fetch around a $100 million. Could this help to reinforce the current market value of Overstock at $650 million? Some believe that they are worth that. Overstock is making the right call to focus on the more rapidly growing blockchain world instead of the perennially challenged retail business and that the stock could rally further thanks to tZero and Medici.

With major retailers like Overstock taking a serious interest in crypto, this helps to bring attention to the cause and make other businesses and crypto projects more attractive. When we see Overstock sell their retail business and go full scale into crypto, this will be a major sign that big things are coming for crypto and soon.

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