Overstock announces plans to issue its own stock on the tØ blockchain platform

Online retail giant Overstock announced at the 41st International Futures Industry Conference held yesterday that it will issue Overstock’s own shares on its blockchain equity trading platform tØ.

The tØ platform was first unveiled in August 2015. Overstock CEO Patrick Byrne wanted to revolutionize securities trading and settlement through blockchain technology, and the tØ blockchain equity trading platform was the product of this concept. Securities and bonds can be issued on the tØ platform as a digital, blockchain-based asset, thus breaking the T+3 settlement model established by DTTC.

Overstock will issue two versions of Overstock shares, one of which will be issued on traditional trading systems such as Nasdaq, and the other on the tØ blockchain platform.贾德•巴格利, Overstock's general manager of cryptocurrency, said its blockchain shares will "rely entirely on a decentralized ledger" for trading, settlement and recording.

Bagley told CoinDesk:

“We have repeatedly demonstrated the security and reliability of this technology… This gives us confidence that the tØ platform can operate and that we can assure investors that we can also meet the security and reliability requirements of the SEC.”

Bagley noted that Overstock sold $5 million worth of “cryptobonds” in July 2015 as part of an initial trial by CEO Patrick Byrne and FNY Managed Accounts, a New York-based trading firm, using blockchain technology to demonstrate how financial instruments could be digitized and traded.

For its tØ stock, Bagley said Overstock uses a permissioned ledger to manage shares, though transactions will be batched and cryptographically hashed on the bitcoin blockchain for additional transparency.

A total of 25.29 million shares will be issued, and as part of the project, Overstock will issue 1 million blockchain preferred shares.

"We settled on 1 million shares, which will provide enough liquidity to prove the concept," Bagley said. "This stock offering is not about raising money, but about demonstrating the potential of this technology."

Binary Market

Notably, the introduction of blockchain stocks means Overstock’s shares will trade on two different markets, potentially with two separate values.

For example, Bagley noted that there is no system for anchoring blockchain preferred shares to traditional stocks, meaning traders could trade both assets.

“We expect traders to see arbitrage opportunities, and if there is a pricing discrepancy between blockchain stocks and other stocks, traders will take advantage of that,” Bagley said. “The value will be determined by the market.”

Finally, it’s important to note that Overstock did not provide a timeline for the proposed launch.

Original article: http://www.coindesk.com/overstock-blockchain-stock/
By Pete Rizzo
Translator: printemps
Editor: printemps
Source (translation): Babbitt Information (http://www.8btc.com/overstock-blockchain-stock)