Overstock subsidiary Medici Ventures will cease providing all previous services pending a full conversion into a limited partnership fund.
Online technology retailer Overstock is converting its blockchain investment wing into a cryptocurrency-focused investment fund as it seeks to maximize profits amid the crypto boom.
Overstock.com announced on Monday that its wholly owned blockchain-focused subsidiary, Medici Ventures, will become a limited partnership fund, pending legal and regulatory approval.
Medici Ventures, which previously oversaw and managed Overstock’s investments in blockchain-related companies, will cease providing its usual services, which also included software development and design services.
The fund is expected to run for eight years, with a capital commitment of $45 million. Third-party venture capital firm Pelion Ventures Partners will act as general partner of the fund and will exercise sole authority and responsibility over investment decisions. Profits from the fund will be returned to Overstock first before being split according to the fund’s limited partnership agreement. The fund will also own a “significant” minority stake in the Overstock-owned tZero Group.
“Blockchain technology represents a leap forward in fundamentally changing the way we interact and transact with each other,” said Overstock CEO Jonathan Johnson. “We remain bullish on blockchain technology but are changing the way we interact with these assets.”
Pelion Ventures founder and general partner Blake Modersitzki added, “We are honored Overstock selected us to maximize the value of its blockchain assets. Many of these companies have real potential. We believe our team knows how to help them reach that potential.”
Earlier in January, a Utah federal judge reversed his decision to dismiss a class-action lawsuit that accuses Overstock of knowingly distributing a security token. The OSTKO token was framed as a “digital dividend” airdropped for free to Overstock shareholders, which plaintiffs in the case claim was designed to manipulate the Overstock’s stock price.