Cypherpunk Technologies has launched a Zcash mining operation, adding production capacity to its treasury strategy. The Nasdaq-listed company has about 4.2 GSol/s across U.S. facilities, representing 18% of Zcash’s network hashrate.
The expansion follows a $33.33 million investment from Winklevoss Capital, which financed the mining equipment. Additionally, Cypherpunk appointed mining veteran Kevin Zhang to lead the operation.
Mining Supports Treasury Growth
The mining is a means to the company to boost their ZEC number and also to obtain operational cash flow. Thus, mining income may pave the way for additional spending and investments in privacy-oriented technologies.
Cypherpunk controls 323,394 ZEC, equal to approximately 1.92% of circulating supply. Moreover, management aims to accumulate 5% of Zcash’s total supply over time.
However, the expansion follows a difficult period for Zcash after researchers uncovered an Orchard vulnerability. The disclosure triggered a ZEC selloff and pressured Cypherpunk shares. Developers quickly patched the issue, while the July Ironwood upgrade added safeguards.
As a result, the mining fleet shows up when Zcash is trying to further boost security, decentralization, and investor trust. Notably, Cypherpunk estimates the mining opportunity amounts to more than $250 million per year.
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