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Overstock’s TZero Will Create an STO Frenzy

Overstock.com, inc, will cement its entrance into the crypto space by launching its own token within a week. The token called “TZero” will complement the launch of its alternative trading system (ATS) exchange – a new marketplace for Security Token Offerings (STOs). The launch will be a significant event for the entire crypto ecosystem as it will mark a potential shift from ICOs to STOs. And it could rally the market initiating a new buying frenzy for STOs.

History

Overstock opened for business in 1999; it was founded by CEO Patrick M. Byrne and it’s headquartered in Salt Lake City, Utah. It’s business model consists of the resale of surplus merchandise. The transition from online retail sales to a crypto service provider began in 2014 when the company began to accept Bitcoin as payment for its goods. Soon after Overstock develop Medici Ventures to expand its reach into blockchain-based enterprises.

Objective

Using enterprise-level blockchain, TZero seeks to make current trading of securities far more efficient. It will add liquidity to a future STO market by allowing accredited investors to sell their positions to retail investors. Based on the ERC-20 token, it offers the compatibility of existing coins, trading processes, and storage.

New Market Catalyst

TZero looks to establish a fully SEC compliant, securitized exchange for the issuance, trade, and management of STOs. On it, new companies will have the chance to launch their own STOs and raise funds in a regulated way. In addition, TZero is raising interest in capital investors as well, possibly re-igniting investment in the industry. It is confirmed that the Chinese equity firm GSR invested $130 million in TZero’s ICO and Overstock shares; with a maximum $270 to $400 millions planned. In fact, competitors saw TZero’s potential since last June and began preparations to launch tokens of their own. Among these are Coinbase and Nasdaq.

Analysis

TZero stands to introduce an entirely new market system that are fully regulated, stable, and backed by established entities. There is no ambiguity in declaring that TZero is the real thing. For example, unlike faudulent ICOs, Overstock spent $30 million dollars to build the exchange. The money went into buying securities broker service providers like SpeedRoute, plus clearing houses, custodians, and SEC’s brokerage licences. This is significant when considering that Overstock expect losses of $39 milliom for Q1 2019 due to the devaluation of crypto prices.

Despite controversy surrounding Byrne’s early marketing statements about the viability of TZero, the venture reached one billion dollar valuation. And thanks to the hype building around it, the token price may reach $200 to $285 in a year.

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