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Billionaire venture capitalist and co-founder of PayPal and Palantir Technologies, Peter Thiel’s Founders Fund, has fully divested from Ethereum, a digital asset treasury company that owns Ethereum (ETH).
This development comes at a time when digital treasure companies are facing increasing pressure amid the decline of the digital currency market in general.
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Peter Thiel cuts ties with ETHZilla during cryptocurrency market downturn
The digital asset treasure wave gained momentum last year, with many companies adopting Strategy’s (formerly MicroStrategy) 2020 Bitcoin (BTC) plan. Companies began to stack Cryptocurrencies as a reserve asset, attracting increasing interest from investors with High prices Stock valuations are rising.
BeInCrypto reported in August 2025 That through entities like The Founders Fund, Thiel controlled a 7.5% stake in ETHZilla. However, the latest filing with the Securities and Exchange Commission shows that the entities managed by Thiel did not report ownership of the company until the end of 2025, suggesting a complete exit.
“This is important because Thiel is considered a savvy institutional investor, and a complete exit from an ETH treasury company may signal a change in sentiment, a reduction in risk, or a strategic evolution away from exposure to Ethereum.” As I said Crypto Town Hall that.
The move comes amid a broader market decline. In October, the cryptocurrency markets saw a decline Sharp often called the crisis “10/10” or “Black Friday”. The following months continued the decline.
Second For the data CryptoRank, Ethereum fell 28.4% in Q4 2025, marking the first negative Q4 since 2022. Although 2026 started with a brief recovery, the recovery quickly turned around.
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ETH closed January 2026 down 17.7%, and so far in February, Its price has decreased from Another 18.1%. At the time of writing, it is trading at $2,017.
Treasury Strategy Under Pressure as Ethereum Decline Impacts Corporate Holders
The continued price weakness has directly impacted digital asset custodians, reducing the value of their cryptocurrency holdings. Click on stock prices. For example, BitMine is currently struggling Unrealized losses over $7 billion. In addition, decrease Its share price is up 25.7% year to date.
ETHZilla, which previously operated as 180 Life Sciences before pivoting to an Ethereum treasury strategy and rebranding, faced similar headwinds. At its peak, the company had more than 100,000 ETH.
As market conditions deteriorated in October, the company moved quickly to reduce its exposure. Towards the end of that month, ETHZilla sold about $40 million in ether, going towards a stock buyback.
A second round followed of sale in Decemberfor a total of approximately $74.5 million. The funds were set aside to pay off the convertible debt secured by the tooth. appears Data CoinGecko reports that the company now holds 69,802 ETH, a significant decrease from its previous position at the peak valuation.
Since then, the company has instituted another strategic change. Second Bloomberga subsidiary of Ethzilla called Ethzilla Aerospace, to provide nominal equity exposure in jet engine leasing.
