BTCS Inc., a blockchain technology focused company, and Spondoolies-Tech Ltd., an Israel-based transaction verification server manufacturer, have received merger approval from the Israeli Office of Chief Scientist (OCS).

The companies entered into a definitive merger agreement last year and closing of the merger required the OCS approval as well as the confirmation from the Israeli Tax Authority regarding deferred payment of applicable Israeli taxes related to the transaction.

"BTCS produced year-over-year revenue growth of 1,225% in 2015, while cash used in operations was reduced by 25%. To combine this strong performance with Spondoolies' industry leading technology, which generated impressive revenues for its first and second generation products, we'll be positioned to create a new global leader in the blockchain sector", said Charles Allen, Chief Executive Officer of BTCS.

According to the press release, BTCS shareholders will own a 69.7% to 61.2% stake in the combined company, while Spondoolies shareholders will own 30.3% to 38.8%, on the basis of the number of common and preferred securities outstanding immediately following the merger. The ownership range is a function of BTCS' liquidation preference associated with its existing $2.25 million investment in Spondoolies. The final ownership percentages will be determined prior to closing.

"The blockchain is set to radically change the future of transaction-based industries," stated Guy Corem, Chief Executive Officer of Spondoolies. "BTCS has positioned itself at the core of this disruptive transformation, and we are excited to combine forces to capitalize on the immense opportunities that lie ahead. The OCS approval places us one important step closer to completing the merger."

In a letter to the company’s shareholders, Allen said that there are several key milestones BTCS expects to achieve this year.

“We believe our transaction verification services business will lead to rapid revenue growth this year, and our pending merger with Spondoolies should further strengthen our financial performance and product offerings”, he said.