ETHZilla, a company supported by Peter Thiel, seems to be moving away from holding Ethereum in its corporate treasury, after only trying this strategy for four months.
The company announced it sold $74.5 million worth of its Ethereum (24,291 coins) to reduce its debt.
ETHZilla announced it will stop reporting mNAV – a metric used to compare the value of its crypto assets to the overall company value – and will instead concentrate on tokenization efforts.
Community reactions
The company’s quick change in strategy regarding ETH received a varied response from industry experts. One analyst strongly criticized the move, claiming it destroyed shareholder value in a short period and was a humiliating decision.
Two months ago, the net asset value was $30 per share, but it’s fallen significantly since then, which is concerning. I haven’t witnessed such a rapid loss of value and such poor choices from management in over 25 years, except maybe with speculative SPACs.
ETHZilla’s net asset value (mNAV) dropped below 1 in early December, following a similar dip that almost happened in late October.
In late October, the company tried to increase its net asset value (mNAV) by repurchasing shares, funding this with the sale of $40 million worth of its Ethereum (ETH) holdings.
As debts continue to grow, another downturn in the market in 2026 could make it harder for the company to carry out its plans for Ethereum and run its business.
When a project’s market value (mNAV) falls below 1, it becomes challenging to attract new investment or sell existing shares to purchase more ETH.
This is why Strategy has increased the size of its USD reserve fund. This ensures they can meet immediate financial obligations without having to sell their Bitcoin, even if the cryptocurrency market stays down for a long time and the value of their assets decreases.
ETH struggles amid outflows
ETHZilla rebranded from 80 Life Sciences Corp, a biotech firm focused on therapeutic drugs.
In August, the company changed its investment strategy to focus on Ethereum. They aimed to increase their Ethereum holdings and earn rewards through staking and a variety of other activities within the Ethereum network.
The company grew to become the ninth-largest holder of Ethereum (ETH), with a treasury of 93,800 ETH, currently valued at $280 million.
Despite the crypto market downturn in the fourth quarter, the company has shifted its focus entirely to tokenization. Crypto investor Mike Dudas of 6thMan Ventures commented on this change in direction, saying…
As a crypto investor, I’m really noticing a shift with this project – it’s the first one I’ve seen clearly move away from the mNAV model and build a real, operating business. We’re seeing a lot of Real World Asset tokenization happening across different blockchains, and I’m curious to see if this particular project will stick with ‘ETH’ in its branding, or if they’ll evolve the name to better reflect this growing RWA space.
Over the last week, companies managing Ethereum (ETH) saw a decrease of 107,700 ETH. Additionally, Ethereum ETFs experienced outflows of 116,000 ETH, totaling almost $670 million.
ETH struggled below $3k amid ongoing outflows.
Final Thoughts
- ETHZilla dumped more ETH to clear debt and signalled a shift from the ETH treasury to tokenized assets.
- ETH ETF and treasury firms saw nearly $670 million in outflows in the past seven days.
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2025-12-23 14:09