The exit by billionaire tech investor Peter Thiel’s Founders Fund from ETHZilla marks a notable pivot in how crypto treasuries are managed and disclosed. A Tuesday filing with the U.S. Securities and Exchange Commission shows affiliates of Thiel no longer hold any stake in the Ether-focused treasury company, signaling a retreat from a venture that once intersected biotech finance with a crypto strategy. The move comes after an Aug. 4, 2025 filing disclosed a 7.5% stake in 180 Life Sciences Corp., comprising 11,592,241 shares valued at roughly $40 million when shares traded near $3.50. In crypto markets, the timing of this exit underscores growing scrutiny of Ether‑heavy treasury models as investors reassess risk, liquidity, and regulatory clarity.

ETHZilla’s lineage traces back to a biotech outfit rebranding around a dedicated Ether treasury program. The rebirth into ETHZilla followed a July 2025 fundraising drive that raised about $425 million to launch an Ether treasury strategy and reposition the company under the new name. That period underscored the appetite among certain investors for backing Ether-centric balance sheets, even as Ether‑heavy strategies faced volatile price swings and evolving risk controls. The narrative around ETHZilla intensified as the firm subsequently pursued additional liquidity through convertible debt, expanding its Ether holdings in a bid to deploy capital across decentralized finance (DeFi) and tokenized assets.

The sequence of events in late 2025 paints a fuller picture of how these strategies evolved. In September, ETHZilla tapped investors for roughly $350 million via convertible bonds, enabling further expansion of its Ether holdings. At one point, the firm held more than 100,000 Ether, positioning its balance sheet as a significant, if high‑volatility, exposure to the largest smart contract platform’s native asset. The strategy sought to diversify across DeFi protocols and tokenized assets, but the market environment subsequently prompted reallocation and liquidity management moves as macro and crypto-specific tides shifted.

By December, ETHZilla began liquidating a portion of its Ether holdings to meet debt obligations. Specifically, 24,291 Ether were redeemed for about $74.5 million, executed at an average price near $3,068.69 per Ether, leaving roughly 69,800 ETH on the balance sheet. The liquidation underscores how even large treasury positions can be trimmed in response to funding needs or risk controls, particularly when market liquidity and asset correlations complicate balance sheet management. The exit by Founders Fund, paired with ETHZilla’s own liquidity actions, reinforces a broader move among Ether-based treasury actors to reassess capital allocation, leverage, and the durability of non‑Bitcoin crypto treasury playbooks.

Thiel’s withdrawal from ETHZilla is framed by broader tensions in crypto treasury models that favored Ether over Bitcoin (CRYPTO: BTC) in earlier disclosures. While some managers pursued diversified holdings across multiple assets, a number of high‑profile Ether accumulators have taken different paths. BitMine Immersion Technologies, the largest listed Ethereum holder, expanded its Ether stake by purchasing 40,613 ETH on Feb. 9, driving total holdings beyond 4.3 million ETH and pushing the value of its portfolio into the tens of billions of dollars at prevailing prices. In contrast, Trend Research moved to unwind a substantial position, selling 651,757 ETH for about $1.34 billion and locking in roughly $747 million of realized losses. The varying approaches illustrate a market segment wrestling with how to balance liquidity, yield, and risk in a rapidly evolving crypto landscape.

ETHZilla itself did not stay static after the initial pivot. The firm launched ETHZilla Aerospace, a subsidiary intended to provide tokenized exposure to leased jet engines, as part of a broader diversification effort beyond plain Ether holdings. The pivot to tokenized real‑world assets (RWA) and crypto yield initiatives reflects the broader industry push to build revenue streams that can complement or hedge against crypto market cycles. Yet Thiel’s exit amplifies the narrative that Ether‑centric treasury structures—once viewed as a strategic differentiator—face renewed scrutiny from investors seeking clearer governance, transparency, and diversification in an environment defined by price volatility and shifting liquidity regimes.

The evolving story of ETHZilla and its contemporaries sits within a wider context of institutional attention to crypto treasuries. While Ether remains a focal point for many on-chain treasury strategies, observers are weighing whether the sector has adequate risk controls, valuation discipline, and regulatory clarity to sustain large, illiquid holdings. The SEC filings—along with company disclosures and market actions—will be watched closely for any further changes in ownership, debt facilities, or new collateral arrangements that could influence Ether’s standing in corporate balance sheets and in broader market sentiment.

Key takeaways

Founders Fund affiliate holdings of ETHZilla were reduced to zero shares via a Schedule 13G amendment filed with the SEC, signaling an exit from the vehicle that once included a 7.5% stake in 180 Life Sciences Corp.
180 Life Sciences rebranded to ETHZilla after a July 2025 fundraising round that raised about $425 million to back a dedicated Ether treasury strategy.
ETHZilla pursued additional capital through a September 2025 convertible debt round, enabling expansion of its Ether holdings and deployment across DeFi and tokenized assets, at one point exceeding 100,000 ETH.
December 2025 saw a liquidation of 24,291 ETH for roughly $74.5 million to repay debt, leaving about 69,800 ETH on the balance sheet.
Thiel’s exit underscores ongoing strain on Ether‑centric treasury models as the market consolidates and investors reassess risk, liquidity, and governance around crypto treasuries.
Ethically and strategically, ETHZilla diversified into tokenized jet‑engine exposure through ETHZilla Aerospace, signaling a broader push to blend real‑world assets with crypto yields.

Tickers mentioned: $BTC, $ETH

Market context: The move reflects broader liquidity and risk considerations shaping crypto treasuries as investors weigh yield against volatility and regulatory risk. Transparency via 13G filings intersects with a sector still building governance norms around crypto treasury management.

Why it matters

For investors and developers in the crypto space, the Thiel/ETHZilla episode highlights the fragility and adaptability of Ether‑heavy treasury models. The sequence—from a high‑profile rebrand and a large capital raise to a substantial liquidation and a major investor exit—reveals how treasuries anchored to Ether can be exposed to rapid swings in token prices, funding needs, and balance sheet constraints. The development underscores the importance of governance clarity, valuation discipline, and diversified asset mixes for corporate treasury strategies that ride on volatile digital assets.

From a market perspective, the episode amplifies the ongoing debate over whether Ether is a suitable long‑term treasury anchor for publicly traded or VC‑backed entities. While some firms have pursued aggressive Ether accumulation to maximize yield opportunities in DeFi and tokenized assets, others are retreating or retooling their strategies in response to liquidity spikes, drawdown risks, and the potential for regulatory changes that could affect custody, reporting, and capital adequacy.

For builders and operators of treasury platforms, the ETHZilla case reinforces the value of transparent public disclosures and flexible architectures that can accommodate both Ether holdings and structured debt, while offering pathways to tokenize real‑world assets and monetize yield streams. It also cautions that even well‑capitalized Ether portfolios must be prepared to realign in a market where price sensitivities and funding requirements can abruptly alter risk profiles.

What to watch next

Follow any additional SEC disclosures or updates to ETHZilla’s corporate filings that could reveal new ownership structures or debt instruments.
Monitor developments around ETHZilla Aerospace and any further tokenized real‑world asset projects that could broaden the firm’s revenue mix.
Track the pace of Ether liquidity movements from large holders like BitMine and Trend Research to gauge how the sector is balancing yield, risk, and capital preservation.
Observe broader regulatory signals related to crypto treasuries, custody standards, and reporting requirements that could influence future treasury strategies.

Sources & verification

SEC filing: Schedule 13G for Founders Fund and ETHZilla holdings — primary_doc.xml — https://www.sec.gov/Archives/edgar/data/1690080/000199596426000003/xslSCHEDULE_13G_X01/primary_doc.xml
SEC filing: Schedule 13G reporting a 7.5% stake in 180 Life Sciences Corp. (Aug. 4, 2025) — primary_doc.xml — https://www.sec.gov/Archives/edgar/data/1690080/000141588925021455/xslSCHEDULE_13G_X01/primary_doc.xml
180 Life Sciences rebrands to ETHZilla — Cointelegraph article — https://cointelegraph.com/news/down-99-biotech-firm-180-life-sciences-pivots-crypto-eth
ETHZilla raises $350M via convertible bonds — Cointelegraph article — https://cointelegraph.com/news/ethzilla-raises-350m-expand-ether-holdings-defi-yield
Bitmine staked Ether holdings and broader ETH treasury data — Cointelegraph article — https://cointelegraph.com/news/bitmine-staked-ether-holdings-annual-staking-revenue
Trend Research reduces ETH holdings — Cointelegraph article — https://cointelegraph.com/news/trend-research-reduces-eth-holdings-325k-187k-eth-binance
ETHZilla liquidates Ether and restructures debt — Cointelegraph article — https://cointelegraph.com/news/ethzilla-liquidates-ether-redeem-convertible-debt
ETHZilla tokenized jet engines RWA — Cointelegraph article — https://cointelegraph.com/news/ethzilla-tokenized-jet-engines-rwa-ethereum-liquidity-io