Peter Thiel’s Founders Fund has fully divested from ETHzilla Corp., exiting a 7.5% stake disclosed in August, according to a U.S. SEC filing. The sharp crypto downturn and the October 2025 flash crash forced the company to liquidate assets, selling more than $100 million in ether to fund buybacks and repay debt.
A Volatile Transition From Biotech to Digital Assets
Billionaire investor Peter Thiel and his Founders Fund have fully divested from ETHzilla Corp., according to a U.S. Securities and Exchange Commission filing released late Feb. 17. According to a Bloomberg report, the disclosure shows Thiel‑managed entities now hold no shares in the company, down from a 7.5% stake reported in August.
ETHzilla, headquartered in Palm Beach, Florida, rebranded in 2025 from biotech firm 180 Life Sciences Corp. into a digital asset treasury focused on ether holdings. At its peak, the company held more than 100,000 ETH tokens, but the sharp downturn in crypto markets forced it to liquidate assets, selling $40 million worth in October and another $74.5 million in December to fund buybacks and repay debt.
The firm’s current predicament serves as a stark microcosm of the systemic challenges haunting digital asset treasuries since the historic Oct. 10, 2025, flash crash. During that event, the broader crypto economy — which had recently surged to a peak market capitalization of $4.3 trillion — suffered the largest liquidation cascade in history, wiping out nearly $20 billion in leveraged positions within hours.
In the months since, the market has undergone a painful deleveraging process, with total valuation contracting by more than 40% to its current level of approximately $2.4 trillion. This sustained compression has pushed several institutional players and digital asset treasuries to the brink, including the world’s largest bitcoin treasury firm, Strategy. Despite its aggressive accumulation policy, the firm is currently grappling with unrealized paper losses exceeding $6 billion, as bitcoin struggles to reclaim the six-figure support levels it lost during the autumn rout.
Now, ETHzilla is pivoting toward a bold new strategy: tokenizing real‑world aviation assets. Through its wholly owned subsidiary, ETHzilla Aerospace, the firm is offering blockchain‑based access to equity in leased jet engines. This initiative marks a significant departure from its original crypto‑treasury model, positioning ETHzilla as a pioneer in bridging digital assets with tangible infrastructure.
FAQ ❓
- Why did Peter Thiel exit ETHzilla? A U.S. SEC filing shows his Founders Fund sold its entire 7.5% stake.
- What is ETHzilla’s business model? It rebranded in 2025 as a digital asset treasury focused on ether holdings.
- How has the crypto downturn affected ETHzilla? It sold over $100 million in ether to fund buybacks and repay debt after the 2025 crash.
- What is ETHzilla’s new strategy? Through ETHzilla Aerospace, it is tokenizing equity in leased jet engines.
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