Overstock’s venture into the blockchain space continues it's downfall after the departure of their ex-CEO, Patrick Byrne. This time Bankorus has shut down. Bankorus is an AI-powered, blockchain-wealth management platform, and security token marketplace built on the blockchain.
According to Sonic Zhang, Bankorus’ largest investor, the startup has shut down, with zero cash, no employees, and the only viable asset being a 1 million euro investment in a Lithuania-based credit union.
Bankorus has run out of cash because the second round investors pulled their funds. Reasons been the management position they hope to get from the Rato Credit Union didn’t happen as they had planned.
This credit union was operating under an old structure where there was no private equities, each of the 4000+ account holders has a vote, and each year in March there will be a member’s conference deciding how the credit union should be run and who should run it. And Bankorus didn’t have enough support from the board and management to have control.
According to Sonic all that’s left in Bankorus is about 1M Euro capital investment into this Rato deal, that if Rato wants to convert without us, they have to buy us out at least 1:1. He states:
“If we stick to this investment or increase the size, we will get private shares accordingly after the conversion. As it stands, the potential shares are looking at close to 40% after conversion, if Rato doesn’t gather additional funding from other investors to increase the total cap. It they do, we will be diluted but the total valuation might also go up.”