Makara Capital Backs Out Of Investing In Blockchain Firm tZero
Makara Capital, the Singapore-based private equity company, announced that it will not be investing in tZero, Overstock’s blockchain subsidiary.
In a report published on August 26th, Jonathan Johnson, Overstock’s interim CEO, explained that Makara said the firm wouldn’t be investing in tZero at the moment.
Medici Ventures will continue to support tZERO
Johnson stressed that Makara is still excited about the product by tZero and will potentially consider investing in the future as it progresses. While Makara is backing out, Medici Ventures, the blockchain-focused venture arm by Overstock, will still keep supporting their project.
The news was announced just four days after Patrick Byrne, Overstock’s former CEO, resigned from his post because of a controversial relationship with a Russian lady who acted as a foreign agent.
Byrne had developed a strategy for the company, which was crypto-friendly. He had a crucial role in launching Overstock’s acceptance of Bitcoin (BTC) payments and tZero itself.
The position is replaced by Johnson, while Kamelia Aryafar became the executive vice president and board member of Overstock Retail.
One year of investing plans
Makara’s decision of backing down from the investment to tZero does not come as a surprise as the company was already purportedly delaying the investment multiple times since it was announced on August 2018.
Overstock had announced that Makara would raise a $404 million funding in tZero in partnership with GSR Capital, the Chinese investment firm. In March 2019, the firms decreased their proposed investment amount to $100 million.
On May 9th, tZero finally received an investment of $5 million from GSR Capital, while Makara and GSR were both reportedly reconsidering the further investment.
Overstock’s shares, after this news, continued to drop, eventually over 14% on the day to trade at $17.