Thiel and Founders Fund Exit Ethereum Treasury Firm ETHZilla

• Billionaire Peter Thiel’s investment firm, Founders Fund, completely divested its entire stake in Ethereum treasury management firm ETHZilla, as per a recent SEC filing.

• The shares of ETHZilla fell after the news, highlighting the sensitivity of investors to prominent departures in crypto-related firms.

Billionaire investor Peter Thiel and his venture capital firm, Founders Fund, have made a complete divestment in ETHZilla Corporation. This has been revealed through a filing by the US Securities and Exchange Commission (SEC), which states that there are no shares held as of December 31, 2025. Earlier, Thiel’s entities had a stake of approximately 7.5 percent in the digital asset treasury firm.

The initial investment made by Thiel’s group in ETHZilla had earlier attracted considerable media and investment attention. This investment had earlier caused the stock price of ETHZilla to rise considerably in mid-2025. However, the volatility in the crypto market and the weakness in the price of Ether had put pressure on its balance sheet.

ETHZilla also implemented targeted sales of its Ether holdings to pay off debt in late 2025. The company allegedly sold approximately $74.5 million worth of ETH in these efforts. Several SEC filings demonstrate that the corresponding Founders Fund groups reflect a lack of beneficial ETHZilla ownership. This full-scale exit illustrates how major investors adjust their holdings when market conditions change.

Market Response and Firm Pivot

The stock price of ETHZilla declined in the after-market session based on the news of Thiel’s full divestment. The stock price declined by about three percent, with the digital asset treasury stocks also underperforming. The year-to-date performance of ETHZilla’s stock price indicated a significant decline from the previous peaks. The firm initially had a biotech identity but later switched to an Ethereum treasury approach in mid-2024. This firm pivot included accumulating substantial Ether holdings as part of the treasury. ETHZilla expanded its business into the tokenization of real-world assets and the offering of aerospace tokens during challenging market conditions. 

The company accumulated housing loans and jet engines for potential tokenization initiatives. Such developments indicated a move away from solely depending on the ETH treasury. ETHZilla remains operational despite the loss of prominent supporters. Market participants are now waiting to see what other institutional sentiment signals emerge in crypto treasuries. The Market response is a reflection of marquee investor activity impacting crypto-focused publicly listed companies. ETHZilla is still adjusting its business model despite navigating market sentiment and price volatility. 

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