What happened

Shares of Overstock.com (NASDAQ:OSTK) gained 16% in June, according to data from S&P Global Market Intelligence.

So what

At first glance, Overstock didn't have much news to share in June. Dig a little deeper and you'll find the stock arguably rising due to two important trends. First, analysts lavished praise on Overstock rival Wayfair (NYSE:W) last month, and what's good for the goose is good for the gander. Second, Overstock is an early adopter of bitcoin and other blockchain technologies, and the crypto-currency industry has been on a tear lately. Together, these seemingly unrelated market trends explain why Overstock shares were on the move in June.

E-commerce concept with shopping cart on computer keyboard.

Image source: Getty Images.

Now what

The Medici operation that accounts for Overstock's blockchain operations has exploded from $1.9 million in 2015 revenue to $15.2 million in 2016. The annual run rate for this segment stood at $17.4 million in the recently reported first quarter, but with a 58% year-over-year growth tailwind at its back. Expect this technology to become a larger and more important part of the Overstock story over time, kind of like how archrival Amazon.com's Amazon Web Services now generates 89% of the e-tailer's operating income. It isn't wrong to raise Overstock's valuation when crypto currencies are doing well.

As for the Wayfair connection, Overstock CEO Patrick Byrne spent a lot of time talking about exactly that on the latest earnings call and clearly sees the company as an important peer. That's not necessarily a bad thing, considering Wayfair's strong sales growth and skyrocketing share prices, but that company is throwing some shade over Overstock's e-commerce business these days.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.