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Cypherpunk acquires about 18% of Zcash mining power in $33.33M deal
The equity transaction is structured through a pre funded warrant for 43.29 million shares, with full issuance potentially lifting Cypherpunk’s share count to about 151.1 million.
Cypherpunk Technologies acquired about 18% of Zcash’s mining power in a $33.33 million equity deal, after buying 4,902 mining machines from Moria Mining, an affiliate of Winklevoss Treasury Investments. The machines are expected to run across three US sites and generate about 4.2 GSol/s, making Cypherpunk the operator of what it says is the world’s largest active Zcash mining fleet, according to CryptoSlate.
Cypherpunk said the acquisition shifts its Zcash strategy from primarily holding ZEC to producing it through mining. The company reported it held 323,394.38 ZEC as of Aug. 11, about 2% of circulating supply, and set a target to own 5%, adding that about 1,440 ZEC are distributed to miners each day. It also said mining output could help fund additional ZEC purchases, growth, and investments in privacy focused technologies.
The deal is tied to dilution risk rather than cash payments. CryptoSlate reported that Cypherpunk valued its stock at $0.77 per share and did not pay cash for the fleet, instead using a structure that includes a pre funded warrant for 43.29 million shares with an exercise price of $0.001.
Under the agreement, only 5.37 million shares can be issued initially, while Cypherpunk plans to seek shareholder approval at its next annual meeting for the remaining shares if needed. The warrant also limits Winklevoss Treasury Investments from exercising shares that would push beneficial ownership above 19.99%, and the company appointed Kevin Zhang as head of mining.