Eh, sure, we're in a little downdraft for bitcoin price right now. But let's take a look at the bigger picture here.

One of the more interesting projects in Crypto Land these days, in my opinion, is what Overstock (OSTK) is doing to transform its business. Its founder and CEO Patrick Byrne has always been an interesting character who speaks his mind. In my own business dealings, I try to maintain truth and honesty at all costs, so I guess I'm a little predisposed to appreciate whatever Byrne is up to. As a Warren Buffett aficionado, I also respect the family pedigree. Patrick's father was John J. Byrne, former longtime CEO of GEICO, White Mountains Insurance Group, and Fireman's Fund (a former American Express subsidiary). All of these assets were important contributions to the huge success of Berkshire Hathaway shares in the 1970s, 80s, and 90s.

Son Patrick is in the midst of transforming his American e-commerce also-ran into a premier collection of blockchain-based companies under the Medici Ventures umbrella, a wholly-owned subsidiary of OSTK.

Why is that a good strategy?

As Jack Welch is probably most famous for saying (he's famous for a lot of things I know), you need to collect assets that are either #1 or #2 in their respective industries. You can try for a while to vault yourself into that premier echelon, but if it becomes obvious you will not be able to get there, you need to sell that asset or get rid of it altogether. Some people have called this philosophy Jack Welch's Burning Platform.

In the beginning of the dot-com era, OSTK was competing more or less directly with Amazon (AMZN). These days, however, they've dropped back to at least #4 in the e-commerce arena. Amazon, as you probably know, is one of the most valuable companies in the world. Wal-mart, after years of missteps in this arena, has recently gone on a tear in the e-commerce space after acquiring Jet.com and 12% of Alibaba's chief competitor, JD.com. Recently, loss leader Wayfair has maneuvered its way into third place. And then there is all the little guys enabled by e-tail infrastructure provider Shopify and crafts marketplace Etsy.

In short, in the immortal words of the greatest guitar player of all time,

They say two thousand zero zero party over, oops, out of time

And that's okay! Business is about the pivot. And certainly not about throwing good money after bad.

As CEO Byrne said in the most recent earnings call, "I realized, it was a mistake to try to chase this competitor [Wayfair], and we had to revert to our DNA, which is focusing on value and running the company to profitability."

The plan going forward for OSTK seems to be quite Berkshire-y, to be honest. If Byrne can't sell the the e-commerce platform for cash, then he can clearly use it as a cash-flow generator and deploy excess profits into the long-term value-generating machine that is Medici.

It's true Ben Graham style cigar butt investing at its finest. Only Byrne didn't even have to acquire the e-commerce business for cheap. He built it from scratch!

Everything happens for a reason.

One of the reasons that OSTK fell so far behind AMZN in the post-dot com crash era was a long-running obsession with "naked" short-selling that definitely led them to keep their off the ball against such a formidable opponent as Jeff Bezos.

That has led them to create one of the more intriguing blockchain products out there - the Digital Locate Receipt - which should enable exchanges to track the supply of actual shares available to trade and prevent people from shorting a stock without having any of the shares in their possession. This is where the term "naked" comes from.

It's all finance nerd stuff. But that's what has lead Medici to create its crown jewel asset, Tzero, in a bid to fix all the myriad things that are wrong with our existing financial system. The name of the exchange is a play on how trades are settled today. Even despite digital technology that could record the transfer of ownership of any asset instantly, somehow regulators have allowed bourses to continue the practice of recording share transfer activity and then "settle" those trades 2 days later. For some reason, the industry standard is transaction plus two days (or T+2 as it is most often referred to) for settlement of trades. Given that we have AI bots making most trades on most exchanges in the world today, it absolutely makes no sense that this is how we do things today in the finance world.

The second most interesting company in the Medici stable is Medici Land Governance (MLG). In a world where 2/3 of the world's citizens are unbanked and live on property that is not properly deeded to them, you can start to understand just how massively important this project could be to lifting the world's poor out of poverty. The basis for wealth for almost anybody derives from their ability to own properly deeded property. MLG creates bespoke technology stacks for governments to leapfrog into the 21st century world of land titling, administration, and tax revenue generation. Even my home county in the United States does not have this tech! If you want to create a deed chain today, you need to pay a lawyer to go down to the courthouse and research the history of that address for a day to tell you who owned what structures and where exactly they were built on a defined piece of land, from today all the way back to ever since the government split up that piece of property into an individual lot. It's an expensive, handmade research process that is ripe for disruption.

With that background taken care of, world citizens can far more easily access loans to expand a business, weather rough times, or make investments in their community. That's why MLG has partnered with the World Bank to spread this technology to as many places as possible as quickly as possible. Byrne states in the conference call, "The World Bank is frankly taking us all over the world to make introductions for us to do projects. It's really a matter of how quickly we can build the modules and spin them up."

Other interesting projects in the Medici portfolio are Bitt, which owns an mMoney wallet that is being integrated into the Eastern Caribbean Central Bank, and Vinsent, which is connecting wine connoisseurs directly with wineries to ensure that high-end wines are not fake and properly distributed.

And these are just 4 of the 20-plus blockchain ventures that Medici has directly invested in or started on their own from scratch.

Tzero and MLG could easily become unicorns in the not-too-distant future. And if that happens, OSTK stock could be a multi-bagger just based off their potential alone. But what if overstock.com gets sold for more powder that can be plowed into the Medici portfolio? Then we are talking about BRK-style returns in the long run. Especially when you consider that, if overstock.com is sold, OSTK stock will be the only sufficiently large and liquid blockchain pure play that is currently trading on the stock market.

If OSTK can pull off this transition from e-commerce also-ran to Blockchain Berkshire Hathaway, the potential gains for investors could be huge!

If you've made it this far, thanks for reading. And if you have any comments (in agreement or disagreement) please let me know in the comments below! ✌🏼