Billionaire Peter Thiel’s Founders Fund has dumped its entire ETHZilla stake, according to a bombshell SEC filing dated February 17, 2026. The fund now holds zero shares in what was once touted as “Ethereum’s MicroStrategy,” a stunning reversal from the 7.5% position it held just months earlier. Talk about abandoning ship.
The SEC Schedule 13G filing shows Thiel’s fund has completely exited, with zero voting power and zero dispositive power remaining. This exit comes after ETHZilla’s stock price collapsed a jaw-dropping 97% from its August 2025 peak of $174 to a pathetic $3.40 in after-hours trading.
Thiel’s initial backing came with great fanfare in August 2025 as part of a $425 million private placement. That seems like ancient history now. ETHZilla’s fall from grace tracked Ethereum’s own troubles, with ETH dropping 28.4% in Q4 2025 and continuing its slide through February 2026, when it fell from $3,400 to around $1,900.
From $425M blockbuster to total collapse in months. ETHZilla’s implosion mirrors Ethereum’s own 44% freefall.
The company’s desperate cash crunch became painfully obvious in recent months. October 2025 saw a panic-sell of $40 million in ETH. By December, another $74.5 million in Ethereum was liquidated for debt repayment. The company’s exit reflects growing skepticism towards digital asset treasury models. The bleeding didn’t stop there.
A February 8-K filing revealed ETHZilla had to cough up over $600 million to redeem outstanding convertible notes, including a hefty $87.7 million in premiums and interest. Ouch.
ETHZilla’s current ETH holdings have dwindled to between 65,850 and 69,802 tokens, worth approximately $140 million at current prices. While Bitcoin demonstrates market dominance with a more stable long-term trajectory, altcoins like Ethereum continue to experience dramatic volatility. That’s a far cry from their peak of over 100,000 ETH. The company recently sold 3,965.83 ETH at an average price of $3,173.67 to raise additional liquidity in January 2026.
The company’s flailing attempts at reinvention are telling. They’ve launched an aerospace subsidiary and announced plans to tokenize home loans. Desperate much?
For institutional investors watching this train wreck, the message is clear: Thiel’s exit signals a broader rotation away from Ethereum exposure. The “digital asset treasury” model that seemed so brilliant in 2025 now looks like yesterday’s bad idea.
