By the summer of 2025, ETHZilla was one of the biggest names in the enterprise crypto trend. The company became popular through holding large amounts of Ethereum (ETH) as its primary trading strategy.
With a 7.5% stake from billionaire investor Peter Thiel, the stock has attracted considerable attention. But that story has now changed.
Recent SEC filings show that by the end of 2025, Thiel and his founding fund had quietly sold their entire stake, reducing their 11.59 million shares to zero.
This marks a radical change. At one point, the stock had jumped nearly 200% on news of Thiel’s involvement alone. Since then, it has fallen about 97% from its peak.
ETHZilla stock price
The biggest problem is that ETHZilla itself is changing direction. Since February 18, with a stock price around $3.51, the company has moved away from its Ethereum Treasury model.
Instead of focusing on holding ETH, it is now selling its crypto reserves to reduce debt and invest in commercial aerospace engines.
That said, Peter Thiel’s departure came at a time when the crypto-treasury strategy was facing serious pressure.
While companies like Michael Saylor’s Strategy have had success holding Bitcoin, ETHZilla’s attempt to copy this model with Ethereum has not gone as planned.
Market conditions and price volatility have made the strategy much more difficult to maintain.
How does ETH react?
The chart of Ethereum OI-weighted funding rates from mid-January to mid-February 2026 shows high volatility followed by a period of weakness. At the end of January, like ETH fell of approximately $3,400, funding remained positive overall.
Source: Coinglass
Between mid-January and mid-February 2026, Ethereum fell sharply from around $3,400 to almost $1,900.
During this decline, many traders continued to buy through the decline using borrowed money, which increased risk and helped drive prices down.
The big red spikes in early February show major selloffs, when too many traders were forced out near $1,900. These moments often mark short-term lows, as weak positions are compensated.
By mid-February, business activity slowed. ETH moved sideways near $2,100 and funding fell, showing low confidence and demand. As neither buyers nor sellers take strong positions, prices remain fragile.
Since funding primarily reflects futures trading, it does not fully show sales in the spot market, making it an incomplete signal.
For ETHZilla, which once held over 82,000 ETH, this volatility was not just market noise, it threatened the company’s financial stability.
With its stock down 30% in one month and Ethereum in difficulty, ETHZilla has decided to change direction. The company sold approximately $74.5 million worth of ETH, not to buy more crypto, but to launch ETHZilla Aerospace.
Not everyone gives up
This comes at a time when Bitmine Immersion Technologies now holds approximately 4.37 million ETH, or nearly 3.6% of all circulating supply.
Additionally, Harvard Management Company recently reduced some of its exposure to Bitcoin ETFs and added approximately $86.8 million to Ethereum through a fund from BlackRock.
This shows that large institutions do not see the current market weakness as a reason to leave. Instead, they see it as an opportunity to move to Ethereum while prices are still low.
Final Summary
- The collapse of ETHZilla shows that not all crypto-treasury models can survive market stresses in the long term.
- Peter Thiel’s departure reflects a failed strategy, not the end of institutional interest in Ethereum.
