Morgan Stanley buys stake in Overstock cryptocurrency
Morgan Stanley went shopping at Overstock.com — and it had nothing to do with the discounted leather sofas.
The Wall Street bank has purchased an 11.4 percent stake in the Web retailer just days before the Salt Lake City company’s cryptocurrency trading goes live.
The disclosure, in a regulatory filing by the bank, sent the retailer’s shares soaring on Monday 22 percent, to $55 — putting them up 270 percent since June 12.
Morgan Stanley shares slipped 12 cents, to $52.77. The company, led by Chief Executive James Gorman, is just the latest Wall Street bank trying to figure out how to get in on the spectacular bitcoin rally, which has surged 17-fold this year.
Rivals like Goldman Sachs have explored trading it, while others, like JPMorgan Chase, still haven’t figured out if they’ll even accommodate clients who want to buy them.
Overstock, best known as discounter, has also been one of the foremost companies developing new uses for the technology behind bitcoin. As such, it has become a proxy for investors who wanted the gains of bitcoin without investing in the asset directly.
Overstock accepted the cryptocurrency as payment starting in 2014, and recently started holding 50 percent of bitcoins that are used in transactions.
The company doesn’t disclose how much in bitcoin it holds.
Overstock Chief Executive Patrick Byrne has been a vocal backer of cryptocurrencies, and has led the development of a tZERO, a trading company for bitcoin and other similar crypto-assets.
Byrne didn’t return a call seeking comment.