Cypherpunk launches largest Zcash mining fleet in the world

The Nasdaq-listed company Cypherpunk Technologies (CYPH) is launching the largest Zcash mining operation in the world. Through a share transaction of $33.33 million with Winklevoss Capital, the company has acquired a fleet of miners representing approximately 4.2 GSol/s of Equihash hashrate, spread across sites in the United States. That represents around 18% of the total computing power of the Zcash network.

In short:

• Cypherpunk Technologies buys the largest active Zcash mining fleet through a $33.33 million deal with Winklevoss Capital.
• The fleet delivers 4.2 GSol/s of hashrate, accounting for approximately 18% of the total Zcash network.
• The company wants to expand its ZEC reserves to 5% of the total circulating supply.

Deal with Winklevoss Capital gives Cypherpunk a dominant position

Through the transaction, Cypherpunk Mining LLC acquired the latest-generation Z15 Pro miners from Moria Mining LLC and Winklevoss Treasury Investments. The payment was not made in cash, but through the issuance of so-called pre-funded warrants, allowing Winklevoss Capital to purchase 43,290,042 shares at a price of $0.77 per share.

Cameron and Tyler Winklevoss say investors have so far had few opportunities to gain exposure to Zcash mining. According to them, Cypherpunk is changing that with this acquisition.

According to the press release on PRNewswire, the fleet is immediately operational and runs at sites with above-average uptime and attractive hosting rates. The addressable market volume is estimated at more than $250 million per year, based on the current ZEC price.

Ambition: to get 5% of all ZEC

Cypherpunk is already the largest corporate holder of Zcash, with 323,394 ZEC in its possession. That is approximately 1.92% of the circulating supply. The company wants to grow this to 5% of the total ZEC supply and sees mining as a cost-efficient way to achieve that goal.

Miners collectively receive approximately 43,800 ZEC per month as rewards. Will McEvoy, Chief Investment Officer of Cypherpunk, says mining revenues provide financial room for further ZEC purchases and investments in privacy technology.

Kevin Zhang joins as head of mining at the company. Zhang started Bitcoin mining in 2014 and Zcash mining in 2016, built some of the largest Bitcoin mining facilities in North America and led the first conversion of a power plant to Bitcoin mining on the continent in 2019. Later, at Foundry, he built the largest Bitcoin mining pool in the world. According to Zhang, Zcash mining today shows striking similarities to the situation around Bitcoin mining in 2016.