Just how much of the financial world could new technology disrupt? Patrick Byrne is trying to push the limits. The hard-charging CEO of Overstock.com has become one of the leaders of the movement to use the “blockchain”—the open-source cryptographic code behind Bitcoin—to do far more than run an invented currency.
Last year, Byrne issued the world’s first-ever digital security—Overstock corporate debt—and began creating a new blockchain-based stock exchange to trade it on. Called Medici, the exchange promised a technological revolution that would turn securities trading on its head, replacing the financial clearinghouses that the whole system, and its regulators, depend on.
There’s both promise and threat in the blockchain. Its technology shares and checks information across many computers, so advocates say it’s a tool for transparency and security. But it also radically decentralizes money, leaving it unclear how blockchain-based markets can be policed under the current system. A year and a half after POLITICO first reported on Byrne’s plans and the policy implications of the blockchain, we caught up with Byrne on the progress of the blockchain revolution, the regulatory environment for the technology, and a new idea emanating from the Caribbean.
Q: Last April, you had offered a private security on the blockchain, but you still needed clearance to offer publicly traded stock in purely digital form. How’s that going?
A: We did get permission last December from the SEC to issue an Overstock security on this blockchain system we’ve developed. So we’ve been building up the technology but still working with the regulators.