After a long courtship, Overstock’s security token platform, tZERO, has lost another potential investor.
“Makara will not be investing in tZERO right now,” Interim CEO Jonathan Johnson said during the Overstock investor call on Monday. Johnson did mention that the Singapore-based fund will keep an eye on tZERO and possibly reconsider its decision in the future.
It was Johnson’s first investor call since taking the helm of the e-commerce company last week. Overstock founder Patrick Byrne abruptly resigned from the company on Aug. 22 following an earlier admission of a romantic relationship with Maria Butina, the Russian spy currently serving 18 months in federal prison.
As for Makara, the fund’s departure appears to be the final nail in the coffin for a much-touted investment that considerably dwindled in size over the course of 2019.
Makara entered the fray in March as the co-lead of a $100 million investment in tZERO common stock, which at the time was expected to close in April. That target date came and went with Makara’s partner, GSR Capital, ultimately investing just $5 million in May.
Makara was reportedly still conducting its due diligence on tZERO at the time, with Overstock’s Q1 earnings report noting it was “optimistic (but not certain)” that the Makara deal would be “consummated.”
That did not come to pass.
On the bright side, tZERO’s other security token marketplace – the BSTX exchange for publicly-traded stocks built in partnership with the Boston Options Exchange – is on-track for launch.
“We’re working very closely with the regulators,” tZERO CEO Saum Noursalehi said during the call,