Overstock CEO Patrick M. Byrne's gives Cointelegraph his comments at Money 20/20 Europe conference on the first public offering of securities to be recorded to a distributed blockchain ledger, and how smart contracts will disrupt government-citizens relations.
Thursday Overstock has announced that it has entered into an agreement with Georgeson Inc to act as information agent in its upcoming public offering of blockchain securities.
Cointelegraph: How would you describe smart contracts, and what expects us?
Patrick Byrne: I used to think, when I heard of smart contracts, about this saying of Warren Buffet that something not worth doing isn't worth doing well. I really didn't see the use case for smart contracts and what's really wrong with our current system. However, I have realized that was really short sighted of me and may be the most destructive thing that is going to happen in smart contracts is the disruption of various government activities. Ultimately, the government is a body that is created by citizens and in contract with the citizens to perform certain duties. You could reduce a bunch of those obligations through the blockchain. This may be the big use for smart contracts. For example in the US we have the Congress which allegedly figures the will of the people on say how much to spend on the Navy and then takes that much out of the economy and puts it into the Navy. If you had a digital or a blockchain economy, you could program it so that 4% of every transaction or every exchange goes into the government coffers and we collectively decide through some social mechanism how much to spend on the navy. You would both get a more accurate representation of the will of the people and you would disrupt it. The business model disrupted by that is Congress itself. It may be the case that the contracts that get disrupted by smart contracts are actually the contracts between the citizens and the government. It would have an enormous anti-corruption effect as well.
CT: Can you share some insights about your company - what should the blockchain community expect from you and any surprises from the future?
PB: We announced about three weeks ago that we are about to do a public security, we are doing a rights offering. We announced a week or two ago that Computershare, which is the world's biggest transfer agent, has joined us in this effort. And now another well-known market participant, highly-respected, is joining us to enable us to issue a blockchain security. And you will see over the next few weeks a few other well-known names joining our efforts to issue this blockchain security
Pioneering in Blockchain Securities
The company press release later confirmed that it will be Georgeson Inc, which will be acting as the Information Agent for Overstock's offering of blockchain securities.
Georgeson Inc is one of the world's foremost providers of shareholder intelligence, communications and proxy services. It is a subsidiary of Computershare and was the No. 1 proxy solicitor for annual meetings for the proxy season ending June 30, 2014.
Overstock has been one of the pioneers in the issue of blockchain securities, with t0 (Overstock's majority owned subsidiary) focusing on the development of fintech based on blockchain technology. Overstock made history in June 2015 as the first public company to issue a private security using blockchain technology. In December 2015, the SEC declared Overstock's S-3 filing effective, giving the Company the ability to issue digital shares in a public offering on a distributed ledger. Patrick Byrne has been a vocal supporter of Bitcoin and Overstock.com was the earliest major retailer to accept Bitcoin, back in January 2014.