October 13, 2017

Overstock DAO

On September 27th Overstock.com’s blockchain-focused investment subsidiary Medici Ventures announced that its very own alternative trading system (ATS) will be open for business for any initial coin offering (ICO) in need of a new place to trade per the new SEC guidelines. This platform was initiated via a joint venture between Medici’s capital markets branch tØ along with RenGen LLC and Argon Group and will operate under the regulation of FINRA and the SEC.

Although this is an extremely monumental venture for Overstock in the blockchain tech sphere, it is by no means the internet retailer’s first rodeo when it comes to being a trailblazer in all things cryptocurrency. In January 2014, Overstock became the first major US retailer to accept Bitcoin for payments on their website. Since then, Overstock has been a major player in the cryptocurrency arena; the company now even accepts most cryptocurrencies as a form of payment on their site. As if this weren’t enough proof of Overstock’s commitment to the cryptocurrency cause, later in 2014 executives decided to create Medici Ventures – a subsidiary of Overstock that focuses exclusively on blockchain technology. Medici’s ATS joint venture announcement is the latest push towards integrating blockchain technology into the capital markets space.

That being said, it is no secret that the Medici/RenGen/Argon joint venture was a direct response to the SEC’s recent stance on The DAO (decentralized autonomous organization) tokens and ICOs. Following the SEC’s July 2017 announcement concerning The DAO tokens and investor guidelines on ICOs which seemed to indicate that securities-based ICOs need to be traded on regulated exchanges, the SEC concluded in a ruling that The DAO tokens, a digital asset, were securities. This was construed as a proclamation that at least some ICOs are securities and therefore can only be traded on regulated security exchanges. The SEC also released a general investor guideline about ICOs in tandem with the DAO decision.

Coindesk reported back in July 2017 that Overstock’s ATS was in the process of getting FINRA and the SEC’s blessings for its launch as a regulated security exchange. Overstock.com’s tØ blockchain debuted in August 2015, and in late 2016 Overstock launched and traded its own SEC-regulated cryptosecurity on tØ. The recent SEC decision was the perfect opportunity for Overstock to capitalize on its previous developments.

For now, it seems as though Overstock’s September 27th announcement is welcome news for investors and ICOs looking to legally get their foot in the door. Needless to say, Overstock will not be letting up on its blockchain support any time soon.

Article by Julianne Dardanes 

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