Ethereum colossus ETHZilla rakes in $156 million to bolster Ethereum reserves
ETHZilla Raises $156 Million through Convertible Notes to Expand Ethereum Holdings
ETHZilla, an asset-managed index run by Electric Capital, has announced a strategic move to raise $156 million through the issuance of senior secured convertible notes. This fundraising aims to bolster the company's Ethereum (ETH) holdings as part of a corporate treasury strategy.
The convertible notes offer a three-year term with an initial 0% interest rate for six months, followed by a 4% annual interest rate. This structure provides financing without immediate interest accrual for the first six months, offering a manageable cash flow for ETHZilla. After the six-month period, investors will start accruing interest, aligning their returns with the company’s equity growth potential tied to its ETH investments.
The funds raised will be used primarily to acquire additional Ethereum, signifying a shift towards treating Ethereum as a long-term treasury asset that can appreciate and provide strategic value alongside traditional corporate activities. This approach is part of a broader trend of institutional adoption of blockchain assets in regulated markets.
The convertible note financing also allows ETHZilla to raise significant capital efficiently from institutional investors. The conversion to equity can be attractive in a growing blockchain market, providing investors with potential equity upside as the company grows.
Notably, ETHZilla's rebranding from 180 Life Sciences reflects a pivot from biotechnology towards blockchain asset management, signaling a corporate transformation aligned with emerging decentralized finance trends. This transformation has garnered the attention of notable investors like Peter Thiel, who owns a 7.5% stake in the company.
However, this strategy does come with risks. The Ethereum investment, iGaming industry, and biotech projects all carry certain levels of risk and uncertainty. The volatility of the Ethereum market is the greatest risk for ETHZilla, which may lead to regulatory scrutiny, particularly in Asia and the U.S. The lack of Ethereum holding disclosures by ETHZilla has left certain investors vigilant.
Despite these risks, the news about ETHZilla's Ethereum investment has caused a 5% increase in Ethereum's price, currently trading at approximately 3,200 as of August 12, 2025. Following the announcement of Thiel's investment, the stock of ETHZilla increased by 57%.
ETHZilla also plans to invest the raised funds in yield-bearing assets, enter the iGaming industry, and commercialize its historical biotech material. The entrepreneurship of ETHZilla relies on managing its multiple endeavors effectively to avoid losing track.
Moreover, ETHZilla possesses a DeFi Council, which includes members such as Etherealize, who they advise on strategy. The convertible notes strategy gives investors priority as senior secured creditors.
In summary, ETHZilla's convertible note fundraising leverages debt with equity conversion features to amass Ethereum holdings, positioning ETH as a core treasury asset to enhance corporate financial resilience and growth potential, reflecting a broader trend of institutional adoption of blockchain assets in regulated markets.
[1] Electric Capital. (2025). ETHZilla Announces Convertible Note Fundraising to Expand Ethereum Holdings. [Press Release] [2] CoinDesk. (2025). ETHZilla Raises $156 Million through Convertible Notes to Boost Ethereum Holdings. [News Article] [3] The Block. (2025). ETHZilla's Convertible Note Strategy: Balancing Debt and Equity for Growth. [Analysis] [4] Decrypt. (2025). ETHZilla's Rebranding: From Biotech to Blockchain Asset Management. [News Article] [5] Forbes. (2025). Peter Thiel's Investment in ETHZilla Signals Growing Trust in Ethereum as a Strategic Corporate Asset. [Opinion Piece]
- ETHZilla plans to invest the raised funds not only in Ethereum, but also in yield-bearing assets, enter the iGaming industry, and commercialize its historical biotech material.
- The convertible notes strategy gives investors priority as senior secured creditors in case of any corporate restructuring.
- ETHZilla's CEO stated that they are focusing on treating Ethereum as a long-term treasury asset, following a trend of institutional adoption of blockchain assets in regulated markets.
- Traders in the crypto market have been quite active, with the news of ETHZilla's Ethereum investment causing a 5% increase in Ethereum's price and a 57% rise in ETHZilla's stock price following Peter Thiel's investment.
- With the rise of DeFi (Decentralized Finance) and the growing trust in Ethereum as a strategic corporate asset, more institutional investors are likely to follow Peter Thiel's lead and invest in crypto assets like Ethereum, Bitcoin, and stablecoins.
