Peter Thiel’s Founders Fund Exits ETHZilla Stake Amid Market Volatility
In a significant shift for the corporate Ethereum sector, Peter Thiel’s Founders Fund has fully divested its position in ETHZilla, a company that has built its treasury around Ethereum (ETH). The move, disclosed in a recent U.S. Securities and Exchange Commission (SEC) filing, marks a reversal for the prominent investor group, which had previously been seen as endorsing the model of public companies holding crypto assets.
The Transaction and Its Immediate Impact
According to the filing, Founders Fund sold its entire stake in ETHZilla as of December 31, 2025. This exit comes after Thiel’s investment vehicle had acquired a 7.5% stake in the company in August of the prior year. The investor group also separately disclosed holding over 9% of BitMine Immersion, another firm with a substantial Ethereum treasury.
News of the complete sale triggered a negative reaction in the market. ETHZilla’s stock declined 5% in after-hours trading following the disclosure. This adds to a broader downward trend, with the stock having fallen 28% since the beginning of 2025, as reported by Yahoo Finance.
ETHZilla’s Pivot History and Current Treasury Position
ETHZilla’s corporate identity has been in flux. Formerly operating as 180 Life Sciences Corp, a biotechnology firm, it executed a major pivot in mid-2024 to adopt an Ethereum-focused treasury strategy. This positioned it among a small but notable cohort of public companies, like MicroStrategy and Tesla, that have allocated significant portions of their balance sheets to cryptocurrency.
The company’s current core holding is substantial. As detailed in its public disclosures, ETHZilla currently holds 69,802 ETH, valued at approximately $140 million. This stake places it within the top ten public corporate holders of Ethereum globally, a fact that previously attracted investor interest from figures like Thiel.
In a further strategic shift, the company recently launched a new division, ETHZilla Aerospace, which aims to offer tokenized equity in leased jet engines. This diversification move underscores the experimental nature of its business model beyond simple treasury management.
Context and Implications of Thiel’s Exit
Peter Thiel is a legendary figure in Silicon Valley, renowned for co-founding PayPal and Palantir Technologies and for his early, influential bets on disruptive technology through Founders Fund. His initial investment in ETHZilla was widely interpreted as a high-profile validation of the “corporate Ethereum treasury” thesis—the idea that holding ETH on a corporate balance sheet could be a sound strategic and investment move.
The complete divestment, therefore, signals a notable retreat from that stance. While the filing does not specify the reasons for the sale, it occurs during a period of heightened volatility and regulatory scrutiny for the cryptocurrency market. The performance of ETHZilla’s stock, down significantly for the year, may reflect broader investor skepticism about the sustainability of such hybrid business models that tie traditional equity value directly to a volatile digital asset.
For observers, Thiel’s exit serves as a data point on the challenges facing companies attempting to bridge conventional corporate structures with cryptocurrency-native strategies. It highlights the ongoing tension between the long-term “digital gold” narrative for ETH and the short-term pressures of public market valuation and operational execution in a nascent and unpredictable sector.
