TLDR

  • Thiel’s Founders Fund completely divests from ETHZilla during Ethereum losses.
  • ETHZilla’s stock drops 97% after Thiel’s exit and the decline of Ethereum.
  • ETHZilla sells $114M worth of Ethereum to cover debts and conduct stock buybacks.
  • After the drop in Ethereum exposure, ETHZilla turns to tokenizing real-world assets.
  • The Ethereum treasury firm ETHZilla changes its focus amidst market volatility.

Peter Thiel’s Founders Fund has fully divested from ETHZilla, a digital asset treasury firm that holds Ethereum (ETH). The SEC filing shows that Thiel’s entities reported no ownership in ETHZilla by the end of 2025. Following this news, ETHZilla shares dropped significantly, indicating the firm’s weakening market position.

Thiel initially acquired a 7.5% stake in ETHZilla through his Founders Fund in August 2025. This investment coincided with ETHZilla’s rebranding from 180 Life Sciences to a dedicated Ethereum treasury strategy. At that time, the firm had raised $565 million and positioned itself as a leading Ethereum accumulation entity.

The stock reached a peak of $107 after the rebrand, but the price has since tumbled to around $3.20. This represents an almost 97% decrease from the firm’s peak valuation. The divestment by Thiel’s fund marks a major change from its previous support.

ETHZilla Reduces Ethereum Holdings Amid Market Weakness

has sold large amounts of its Ethereum holdings to handle financial obligations. In October 2025, the firm sold $40 million worth of ETH to fund a $250 million stock repurchase plan. A second sale in December added 24,291 ETH, worth $74.5 million, to repay senior secured convertible notes.

The firm currently holds 69,802 ETH, down from its previous peak above 100,000 ETH. The reduction in holdings occurs during broader crypto market losses. Ethereum fell 28.4% in Q4 2025 and continued to decline through early 2026.

ETHZilla’s value in terms of Ethereum now stands close to $140 million. This places it among the top 10 public corporate Ethereum holders. Its position is still far behind leaders like BitMine Immersion Technologies.

ETHZilla Pursues New Tokenization Strategy

After reducing its Ethereum exposure, ETHZilla has shifted its focus towards tokenizing real-world assets. The firm acquired 95 manufactured home loans for $4.7 million to tokenize on an Ethereum Layer 2 platform. It also bought two CFM56-7B24 aircraft engines for tokenization through an SEC-regulated platform.

The new strategy aims to generate income through tokenized revenue streams. ETHZilla Aerospace, a subsidiary, will offer tokenized access to leased jet engines. The company intends to create future value from cash flow and revenue growth in tokenized assets.

This change reflects the pressures on Ethereum treasury firms during market volatility. The firm’s stock has dropped 28% year-to-date following broader crypto market declines. Thiel’s complete exit highlights the changing attitude towards Ethereum-focused corporate strategies.