Silbert’s Zcash miner to merge with Nasdaq firm; shares jump

Digital Currency Group’s Zcash miner Fortitude Mining has signed a definitive merger agreement to combine with Nasdaq-listed HeartSciences, the companies said. The firms expect the transaction to close in the second half of the year. HeartSciences shares jumped about 60% in early trading and closed at $2.70, roughly 55% higher than the previous close, reflecting market reaction to the deal. DCG will own approximately 95% of the equity of the combined company.

Fortitude is a subsidiary of DCG that operates Zcash mining infrastructure. The company has mined Zcash since 2019 and buys and runs mining equipment rather than holding large token reserves. Fortitude CEO Andrea Childs said the primary purpose of the business combination is to gain access to public markets and capital to scale the company’s Zcash mining platform and to pursue opportunities linked to its power portfolio. “Going public, we expect it's going to provide us with the flexibility and access to capital to really accelerate our core strategies, which is our venture mining platform, and again, primarily today that's Zcash,” Childs said.

Childs noted Fortitude does not currently hold a significant Zcash balance but left open the option of holding more ZEC on its balance sheet in the future to reduce the need to finance operations by selling mined tokens. The company emphasized active operation of mining assets and the development of power resources as key elements of its business plan.

Zcash has shown sharp swings this month. The token is up about 900% over the past 12 months but plunged more than 60% earlier in the month after a disclosure of a counterfeiting vulnerability triggered a selloff. The Zcash development team later issued an emergency two-step update; ZEC recovered some losses but traded lower on the day the merger was announced, at times near $415.

Fortitude executives expressed optimism about Zcash’s long-term prospects. Childs projected Zcash could reach roughly 10% of Bitcoin’s market capitalization. DCG founder and CEO Barry Silbert has previously predicted that 5% to 10% of Bitcoin’s market cap could flow into privacy-focused cryptocurrencies over coming years.

The transaction follows a pattern of digital-asset firms combining with small public companies to obtain market access and capital. Fortitude and HeartSciences said they expect the merger to provide funding to expand mining capacity and to pursue higher-return opportunities related to energy and power management.