Overstock.com has gained a reputation among the cryptocurrency community for being the first major retailer to check bitcoin as a means of payment and for accepting over 40 digital coins today. The company, however, is more focused in the underlying technology as it continues to invest in the blockchain development to reform the ‘trust economy.’
Overstock.com Heavily Invested in ‘Trust Economy’ Via Medici Ventures
Medici Ventures is a wholly owned subsidiary of Overstock.com created to manage and oversee the company’s investments in startups building solutions based on distributed ledger technologies. The Salt Lake City-based subsidiary focuses on six emerging areas: capital markets, money and banking, identity management, property, voting, and underlying technologies supporting blockchain.
Jonathan Johnson, President of Medici Ventures, has overseen investments in a dozen startups since the founding of the VC fund in 2014, he told Computer World.
“As cool as we thought bitcoin was it was the underlying technology for it that could be even more transformative. Simply put, Overstock.com believes blockchain is the future foundation for an economy built on trust but void of the traditional institutions that have backed those relationships.”
Medici Ventures has recently invested in Voatz, a startup who is developing a system that enables voting via smartphone or tablet with an easy to use platform that includes a fingerprint or retinal scan as a biometric identity for voters to confirm their eligibility to vote. Anonymity and privacy are ensured through an encrypted online identity controlled by the voter. The technology has already been used by leading universities and state political parties.
Institutions assigned to provide trust between parties frequently fail to delivery and that is what Medici Ventures is aiming to solve with their investments.
“They’re in the middle for a reason because when you and I transact and I’m giving you an asset and you’re giving me back an asset, we need trust institutions. I think blockchain technology does that trust transfer through technology.”
The new trust economy is expected to increase over the next two years, according to Deloitte, as blockchain is able to establish trust among parties. Person-to-person (P2P) transactions no longer need traditional methods such as banks or credit rating agencies. Distributed ledger technology is a trusted gatekeeper and purveyor of transparency in a world increasingly dependent on online identity and reputation.
The trust economy extends much beyond the voting booth. Medici Ventures is also invested in tZERO, which aims to setup a platform to compete with traditional stock exchanges. Overstock.com CEO Patrick Byrne wants to replace brokerage fees and commissions with an immutable system that is 80-90% cheaper.
Featured image from Shutterstock.