Few strikes within the small-cap market generate as a lot buzz as when a widely known crypto insider steps in with daring, transformative plans. That’s precisely what’s occurring with ZOOZ Energy (ZOOZ), a little-known Israeli vitality know-how firm that’s out of the blue making headlines far past the EV charging trade. In a shock strategic pivot, Jordan Fried, blockchain entrepreneur and a founding group member of Hedera Hashgraph, has taken over as CEO with a imaginative and prescient to show ZOOZ into what might be the subsequent MicroStrategy (MSTR) of the Bitcoin (BTCUSD) world.
The plan? Alongside its current flywheel-based energy boosting and vitality administration enterprise, ZOOZ will allocate the overwhelming majority of proceeds from a $180 million personal placement towards constructing a Bitcoin reserve. Supporters see the transfer as visionary — an opportunity for a distinct segment clean-energy participant to align itself with “digital gold” whereas differentiating from rivals. Skeptics, nevertheless, query the dangers of tying a penny inventory’s fortunes to Bitcoin’s notoriously risky worth swings, notably when its core enterprise stays removed from profitability.
On this article, we’ll break down the main points behind ZOOZ’s Bitcoin pivot and discover whether or not this new path affords a real path to MicroStrategy-like returns — or if it’s just too huge a wager for this penny inventory to deal with.
Valued at a market cap of simply $20.6 million, ZOOZ Energy (ZOOZ) is a number one supplier of flywheel-based energy boosting and vitality administration options. The corporate affords the ZOOZTER-100, a flywheel-based kinetic energy booster designed to assist the sustainable and cost-effective deployment of ultra-fast electrical car charging stations in grid-constrained areas. Alongside its core vitality know-how operations, upon closing the personal placement, ZOOZ will grow to be the primary firm dual-listed on the Nasdaq Change and the Tel Aviv Inventory Change to implement a long-term strategic Bitcoin treasury. This technique positions ZOOZ as a trailblazer in sustainable, high-performance EV charging and a forward-looking allocator of capital.
Shares of the flywheel‑vitality agency have slumped 30% on a year-to-date foundation.
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On July 29, ZOOZ introduced a $180 million personal placement (PIPE) with accredited institutional buyers as a part of its plans to implement a Bitcoin Reserve Technique. The corporate said that its Bitcoin reserve will function a “strategic asset” complementing its vitality {hardware}, serving to drive progress and set it aside as international monetary infrastructure continues to evolve.
The PIPE deal, pending shareholder approval, will contain ZOOZ issuing 180 million unusual shares and pay as you go warrants at $1 every to a syndicate led by Pantera Capital, FalconX, Arrington Capital, UTXO Administration, ATW Companions, and Israeli investor Alex Rabinovich. In response to the corporate, roughly 95% of the web proceeds might be allotted to establishing a Bitcoin reserve, with the rest used to repay $3 million in debt and fund normal company functions.
Alongside the fundraising, ZOOZ’s board appointed blockchain entrepreneur Jordan Fried, a founding group member of Hedera Hashgraph, as CEO efficient July 31, tasking him with instantly executing the corporate’s digital asset treasury technique. Notably, former CEO Erez Zimerman remained with the corporate to steer ZOOZ Energy’s flywheel-based superior options, overseeing energy boosters and vitality administration programs worldwide. Additionally, the board was strengthened with the appointments of former Citigroup CFO Todd Thomson and former Financial institution Leumi chairman Dr. Samer Haj-Yehia, each of whom joined on July 31. As well as, activist investor Jonathan Christodoro, who has served on the boards of PayPal (PYPL), Herbalife (HLF), and Lyft (LYFT), together with Jonas Grossman, co-founder of Chardan, have been nominated for election as administrators on the upcoming annual assembly.
The PIPE’s closing is contingent on a shareholder vote, scheduled for on or round Sept. 8, 2025, to approve its phrases, amend the corporate’s articles of affiliation to extend approved shares, elect two administrators, and deal with different associated issues. The PIPE is anticipated to shut quickly after receiving shareholder approval.
“This transfer lets buyers in Israel and the US acquire direct publicity to our Bitcoin treasury technique,” Fried stated, including that the twin itemizing equips ZOOZ with “each device to develop our holdings and sign innovation and confidence to the market.” He famous that Bitcoin has delivered a compound annual progress charge of about 82% over the previous decade. Individually, Chairman Avi Cohen described the shift as “a landmark second” that positions ZOOZ “on the innovative of economic innovation whereas reinforcing our lengthy‑time period resilience.” Cohen said that holding digital property aligns the corporate with “an more and more digital future” and has the potential to generate “vital shareholder worth.”
In the meantime, ZOOZ not too long ago accomplished the primary part of its main fundraising effort, securing $5 million by an preliminary personal placement. The corporate issued about 2.5 million unusual shares and pre-funded warrants, priced at $2.00 every. Every unusual share or pre-funded warrant was accompanied by a warrant to buy two further unusual shares at an train worth of $3.06 per share. The corporate plans to allocate a part of the web proceeds towards repaying a portion of its excellent promissory notes, with the rest designated for normal company functions.
“We’re happy to have efficiently closed the Preliminary Personal Placement as a part of this bigger Personal Placement financing, which represents an essential first step in executing our new Bitcoin reserve technique,” stated Fried. “This preliminary capital infusion demonstrates investor confidence in our imaginative and prescient, and we stay up for securing shareholder approval for the total $180 million Personal Placement. With this assist, we intend to construct a strategic Bitcoin reserve aimed [at enhancing] long-term shareholder worth and place the Firm for a brand new period of economic power and innovation.”
After exploring ZOOZ’s Bitcoin treasury ambitions, let’s shift our consideration to the a part of the enterprise that presently generates its income. The corporate final launched its monetary outcomes on March 6. Given the corporate’s market cap, it’s cheap to not count on substantial income or profitability. That stated, its income grew 36% year-over-year to $1.04 million in 2024, pushed by gross sales of ZOOZTER-100 programs. The corporate’s full-year web loss stood at $11 million, or $1.09 per fundamental and diluted share, in contrast with $11.8 million, or $1.99 per share, within the prior yr. As of Dec. 31, 2024, ZOOZ held roughly $7.5 million in money, money equivalents, and short-term deposits.
A single analyst protecting the corporate expects its web loss to slender by 11.93% year-over-year to $0.96 per share in fiscal 2025, whereas projecting a 23.15% decline in income to $0.8 million. Notably, the corporate is projected to put up its first annual revenue in fiscal 2029.
ZOOZ inventory has gentle analyst protection on Wall Avenue, with simply two analysts following the corporate and assigning it a consensus score of “Reasonable Purchase.” One analyst has a “Sturdy Purchase” score on the inventory, whereas the opposite recommends a “Maintain.” In the meantime, ZOOZ’s common worth goal of $5.00 suggests upside potential of roughly 200% from present ranges.
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Placing all of it collectively, I consider buyers ought to keep away from shopping for ZOOZ inventory for 2 major causes.
Initially, there’s no actual must reinvent the wheel, as buyers have already got quite a few methods to realize publicity to Bitcoin — whether or not by buying MicroStrategy shares or shopping for Bitcoin instantly on any crypto trade.
Secondly, I’m considerably skeptical in regards to the firm’s Bitcoin treasury plans. Let me clarify this level in additional depth. Given its small market cap, the inventory may expertise substantial volatility in response to BTC worth actions, probably rising or falling at a lot higher charges than BTC itself. Furthermore, administration views bitcoin as “digital gold” and anticipates “long-term, uneven upside.” Nonetheless, Bitcoin’s worth motion doesn’t precisely assist this thesis, as any shift in international markets towards a risk-off sentiment virtually all the time triggers a pointy decline in its worth. This means a major threat for the corporate, as any substantial drop or extended pullback in Bitcoin’s worth may drive ZOOZ’s inventory under $1, probably leading to a Nasdaq delisting.
With that, the risk-reward profile right here is way from engaging, and as famous earlier, buying MSTR inventory or Bitcoin instantly seems to be a a lot smarter transfer.
On the date of publication, Oleksandr Pylypenko didn’t have (both instantly or not directly) positions in any of the securities talked about on this article. All data and knowledge on this article is solely for informational functions. This text was initially revealed on Barchart.com
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