Overstock doubles down on crypto after true believer Patrick Byrne exits

Overstock.com CEO Patrick Byrne resigned on Thursday after backlash to claims he made about his involvement in multiple FBI investigations.

Despite his apparent link to the politically-charged Russia probe that has dogged the Trump administration, Byrne is more likely to be remembered as a true believer in cryptocurrencies and blockchain technology.

And in case any hardcore bitcoin fans are concerned that Byrne’s blockchain love left Overstock with him—fear not. The interim CEO has reaffirmed the company’s devotion to these efforts.

In an interview just a few hours after being named to the top job, Overstock interim CEO Jonathan Johnson was asked by Yahoo Finance if the company will retain its focus on crypto and blockchain.

“Absolutely, yes,” he responded.

“The fledgling blockchain business is doing well,” said Johnson, an Overstock board member who also oversaw the blockchain startup fund Medici Ventures, which is part of Overstock.

“Our team at Medici Ventures, which is the blockchain-focused business, is still working hard, and those different companies in the Medici family are growing at a nice rate,” he added.

NEW YORK, NY - MAY 15:  Founder and CEO of Overstock.com Patrick Byrne attends Consensus 2019 at the Hilton Midtown on May 15, 2019 in New York City.  (Photo by Steven Ferdman/Getty Images)
NEW YORK, NY - MAY 15: Founder and CEO of Overstock.com Patrick Byrne attends Consensus 2019 at the Hilton Midtown on May 15, 2019 in New York City. (Photo by Steven Ferdman/Getty Images)

Gone but not forgotten

Byrne founded Overstock in 1997 and took it public in 2002. In a statement on Thursday, Overstock credited Byrne with taking the company “from a fax-based liquidator to one of the most influential technology companies of our time.”

Overstock is all in on crypto, and the underlying technology that powers the crypto craze. In 2014, Overstock became the first major e-commerce site to accept bitcoin as payment—the same year it launched Medici Ventures.

In January of this year, Byrne drove the launch of tZero, a platform for security tokens, which sold its own token in a $250 million initial coin offering.

For his part, Johnson served as Overstock’s president for five years, and had a brief stint as acting CEO, during a time Patrick stepped down temporarily due to illness.

But Johnson also tells Yahoo Finance that blockchain and crypto ventures are not more important than the core retail business—they are equal.

“One side of the house isn’t going to get any more love than the other,” Johnson says. “I love both the retail business and the blockchain business.”

Overstock shares over the past five years.
Overstock shares over the past five years.

Overstock’s stock chart from the past few years reflects the moment when shares peaked, thanks to the bitcoin price surge. It shows how Byrne’s very public of embrace of crypto was good for the stock—until Byrne himself became a liability.

Overstock’s shares, which popped by 17% on the news of Byrne’s resignation, ended Friday’s session down nearly 6% at $19.89.

Daniel Roberts is a senior writer and live show host at Yahoo Finance. He closely covers bitcoin and blockchain. Follow him on Twitter at @readDanwrite.

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