Peter Thiel quits ETHZilla: end of an era for crypto treasury?

The digital treasury landscape suffers a major blow. Peter Thiel, the billionaire co-founder of PayPal and Palantir Technologies, has officially severed ties with ETHZilla, the company specialising in managing Ethereum (ETH) reserves. Through his operating arm, Founders Fund, Thiel has completed a total divestment, marking a watershed moment for the crypto-asset-related corporate treasury sector.

Founders Fund's strategic divestment

The news emerges from the latest documents filed with the Securities and Exchange Commission (SEC). While only in August 2025 BeInCrypto reported that Thiel controlled, via Founders Fund and other related entities, a 7.5 per cent stake in ETHZilla, data from late 2025 now shows zero ownership.

This is relevant because Thiel is considered to be an exponent of smart institutional capital, and a complete exit from a company with treasury in ETH could signal a change in sentiment, a reduction in risk or a strategic rotation away from exposure to Ethereum," posted Crypto Town Hall.

This comprehensive release comes at a time of extreme fragility for companies that have adopted the so-called "MicroStrategy playbook". If in 2020 the accumulation of Bitcoin and other cryptocurrencies as reserve assets was seen as a visionary move capable of inflating share valuations, 2025 has radically reversed this trend, putting the financial resilience of those who have staked everything on digital tokens to the test.

The "Black Friday" of Crypto and the collapse of Ethereum

The macroeconomic environment of the sector was marked by the dramatic crash of October 2025, sadly dubbed "10/10" or "Black Friday". Since then, the market has been unable to find a solid footing. Data from CryptoRank evidenced a negative performance of Ethereum of 28.4% in the last quarter of 2025, the first Q4 in the red for the coin since 2022.

The beginning of 2026 did not bring the hoped-for relief. After a brief rebound in January, the bearish trend resumed with vigour: ETH closed January with a 17.7% drop and, in the first weeks of February, lost a further 18.1%. At the time of writing this article, Ethereum's price is hovering around $2,017, far from the glories of previous months.

Pressure on treasuries: the BitMine case and ETHZilla downsizing

The prolonged price weakness has hit companies with direct exposure hard. BitMine, for instance, is currently facing unrealised losses in excess of USD 7 billion, with the share price having lost 25.7 per cent since the beginning of the year.

ETHZilla, born out of the transformation of 180 Life Sciences and focused on the Ether accumulation strategy, has not been immune. At the peak of its expansion, the company held over 100,000 ETH. However, as market conditions deteriorated, management was forced into a strategic retreat:

• October 2025:sale of approximately $40 million in Ether to fund share buybacks.
• December 2025:a second tranche of sales for $74.5 million, used to repay convertible secured senior debt.

According to CoinGecko's data, ETHZilla's current position has fallen to 69,802 ETH, a drastic reduction from its historical highs.

A new route: from tokens to jet engines

Faced with the obvious crisis of the cryptocurrency-only model, ETHZilla is attempting a new metamorphosis. According to Bloomberg reports, the company has launched a wholly owned subsidiary called ETHZilla Aerospace.

The goal of this new division is to provide tokenized exposure to the capital of leased jet engines. This move suggests an attempt to diversify towards tangible assets and cash flows from the aerospace sector, seeking to maintain the blockchain (tokenization) infrastructure but applying it to industries less volatile than the cryptocurrency spot market. It remains to be seen whether this new direction will be able to convince institutional investors after the heavy farewell of a major player of the calibre of Peter Thiel.