Cypherpunk Technologies has announced the launch of its mining division, Cypherpunk Mining, which will focus on mining Zcash (ZEC) using equipment with a total capacity of approximately 4.2 GSol/s. The company estimates that this represents about 18% of the total hash rate for the anonymous cryptocurrency's network.
The mining setup includes the latest Z15 Pro installations along with associated hosting contracts. Cypherpunk claims this is currently the largest operational infrastructure for Zcash mining.
The assets for this venture were acquired from Moria Mining for $33.33 million. Instead of cash, the seller received a pre-paid warrant allowing them to purchase 43.29 million shares of Cypherpunk at an exercise price of $0.001 per share, valuing the stock at $0.77 for the transaction.
Moria Mining is connected to Winklevoss Treasury Investments, an entity affiliated with Winklevoss Capital, founded by brothers Tyler and Cameron Winklevoss. At the time of the deal, Winklevoss Treasury Investments held a 19.9% stake in Cypherpunk.
Kevin Zhang has been appointed as the head of the mining division. He has prior experience with Bitcoin and Zcash and previously worked at Foundry, where he developed mining pools and infrastructure.
Cypherpunk plans to use the mined ZEC to bolster its cryptocurrency reserves. As of August 18, the company held 323,394.38 ZEC, which is about 1.92% of the total supply of the coin. The firm's goal is to increase its share to 5%.
According to Cypherpunk, around 43,800 ZEC are distributed monthly as rewards to miners within the network.
The price of ZEC did not react to this news, having fallen by 1.1% in the last 24 hours, trading at approximately $506 at the time of writing.
Hourly chart of ZEC/USDT on Binance. Source: TradingView.Meanwhile, Cypherpunk's stock rose by 9%, according to Yahoo Finance.
It is worth noting that on July 28, the Zcash mainnet activated the Ironwood upgrade, which introduced a new secure pool after a critical vulnerability was previously discovered in Orchard, theoretically allowing the creation of unbacked ZEC without detection by the protocol's mechanisms.