Bitcoin Shop (BTCS) to Merge with Spondoolies-Tech to Create a Publicly Traded Bitcoin Mining Company
Bitcoin Shop, one of the first Bitcoin companies quoted on the U.S. stock market, announced that it has signed a Letter of Intent to merge with Israeli Bitcoin mining hardware manufacturer Spondoolies-Tech. The Letter of Intent follows last week’s announcement that Bitcoin Shop raised $2.3 million in a venture capital funding round.
Bitcoin Shop, quoted on the OTC Market with the ticker BTCS, is based in Arlington, Virginia. Besides operating an e-commerce store which accepts a variety of digital currencies and offering a multi-signature wallet with bank-grade security, the company is the lead investor in Bitcoin ATM manufacturer Coin Outlet, and runs bitcoin mining operations in a new 83,000-square-foot facility.
The new mining facility is expected to handle more than 10 megawatts of power and up to 40,000 TH/s (terrahash per second) of mining hardware for “transaction verification” operations. (That means bitcoin mining, but with a crisp business-like aura.)
Bitcoin Shop wants to expand and consolidate its position as one of the leading players in the Bitcoin space. “We believe the sustained decline in the price of bitcoin has created tremendous opportunities for us to further expand our business and seize opportunities created from the market downturn,” said CEO Charles Allen, commenting on the latest funding round. “With the completion of this financing we believe we are well positioned to be a leading Bitcoin- and blockchain-focused company.”
The funding announcement noted that the company plans to leverage its transaction verification services business while it builds a universal digital currency platform with the goal of enabling users to engage in the digital currency ecosystem through one point of access.
The merger with Spondoolies-Tech is subject to a number of conditions, including satisfactory completion of diligence and execution of definitive agreements, and it will, therefore, probably take some time to work out the details. It’s expected that the merger will build a fully integrated transaction verification services business using Spondoolies-Tech mining technology.
Both companies believe the anticipated combination of Bitcoin Shop and Spondoolies-Tech will create the world’s first publicly traded company to produce Bitcoin transaction verification equipment.
“Our key goal in 2014 was to create the partnerships needed to build an ecosystem and start laying the foundation to put our vision into place,” said Allen. “Once completed, our merger with Spondoolies would be a significant leap forward in making this ecosystem a reality. [O]ur next objective will be to complete the development and production of a next-generation chip to drive our transaction verification services business and to generate revenue from the combination.”
Spondoolies-Tech is a digital currency hardware manufacturer. Founded in 2013 by a group of Israeli high-tech veterans, the company raised $10 million in capital from leading Israeli venture capital firms with the goal of building Bitcoin transaction-verifying servers from the bottom up, creating the infrastructure on which digital currencies will flourish.
Spondoolies-Tech produces a line of bitcoin mining hardware rigs, considered among the best in the industry. Besides, it offers cloud mining services in cooperation with Genesis Mining.
“Over the last several months, we’ve worked closely with Charles Allen and the BTCS team to establish the nature of our potential partnership,” said Spondoolies-Tech CEO Guy Corem. “The synergy between the teams is amazing. I have the utmost of confidence that together we will build a very successful and prosperous company by growing and expanding our business beyond bitcoin mining equipment.”