Peter Thiel Dumps ETHZilla — Treasury Play Hits the Skids

Thiel exits and ETHZilla’s rocky ride

In mid-February, an amended filing made it official: Peter Thiel and related Founders Fund vehicles are listed at zero shares and 0.0% ownership of ETHZilla, with the event dated December 31, 2025. That’s the public-market mic drop — a clear exit stamp after months of shrinking stakes.

Back in August 2025 Thiel showed up as a major holder (about 11.6 million shares, roughly 7.5% of the company). By late September that position had already been pared down to under a million shares, and the march to zero finished with the February amendment. The market had mostly figured that out already: ETHZilla’s stock has plunged roughly 95% since last August, tumbling from around $74 to just above $3.50.

The selling wasn’t just insiders. The company disclosed several ETH sales — a small sale in January (around 3,966 ETH for roughly $12.6 million at an average in the low $3,000s) and a prior, much larger sale tied to debt pressure (about $74.5 million). ETHZilla also paid off a major chunk of convertible debt this year, clearing a principal balance of about $516 million plus roughly $87.7 million in redemption premium and accrued interest. Translation: financing got expensive and management had to make tough choices.

Why the treasury model is fragile — and what to watch

Treasury companies are basically bets that a listed wrapper can hold a volatile crypto stash and survive storms. When everything’s easy, the math looks great: equity trades at a premium to the crypto, financing is cheap, and the loop powers itself. But when carry and staking yields are slim, the safety net gets thin and every decision — selling ETH, taking on debt, issuing shares — starts to move the needle a lot.

Public indicators show futures carry and staking yields sitting in the low single digits (staking benchmarks are roughly in the high twos percent range). With those cushions modest, execution and capital structure become the story, not just the ETH on the balance sheet.

Here’s a simple way to feel the sensitivity: ETHZilla reported about 65,850 ETH remaining and has roughly 19.3 million shares outstanding. That ETH position alone implies per-share crypto value of about $6.80 if ETH is $2,000, about $5.10 at $1,500, and roughly $10.20 at $3,000 — before you count cash, debt, operating burn, or other liabilities. Small moves in ETH price or financing terms swing those per-share numbers quickly.

So keep your binoculars trained on a few things: updates to the ETH balance, any new financing or equity moves after that big debt redemption (the premium paid for redemption is a red flag about market access), and whether management drifts into side bets that dilute the treasury story. Also watch macro inputs — futures basis and staking yield — because they are the air beneath this whole trade.

At the end of the day, Thiel’s 0.0% is a tidy line item that forces a question: did he just lose faith in the execution, or did he see risks the market hasn’t fully priced yet? Either way, the episode is a neat case study in how fragile public treasury plays can be when the math and the financing both get tight.

Not financial advice — just reading the filings and making a little sense of the chaos. Always do your homework before leaning into volatile strategies.