Peter Thiel’s fund pulls out of Ethereum investment, causing ETHZ stock to drop in after-hours trading.

February 18, 2026

Shares of ETHZilla experienced a significant drop of over 5% during overnight trading following the release of filings indicating that Peter Thiel’s Founders Fund had completely divested its stake in the company.

The decision by Founders Fund to sell off its entire position in ETHZilla has raised eyebrows in the investment community and left many wondering about the rationale behind the move. While Thiel and his fund have been known for making bold and sometimes contrarian investment decisions in the past, the timing of this sell-off has caught many off guard.

One analyst, who preferred to remain anonymous, speculated that Founders Fund may have decided to exit its position in ETHZilla due to concerns about the long-term viability of the company. “It’s possible that Founders Fund sees some underlying issues with ETHZilla that the rest of the market may not be fully aware of yet,” the analyst said. “They could be taking a cautious approach and choosing to cut their losses before any potential problems become more apparent.”

Another factor that may have influenced Founders Fund’s decision to sell its stake in ETHZilla is the recent volatility in the cryptocurrency market. With prices of major digital currencies like Bitcoin and Ethereum experiencing significant fluctuations in recent weeks, it’s possible that Founders Fund wanted to reduce its exposure to this sector and reallocate its capital to more stable investments.

Despite the drop in ETHZilla’s share price following the news of Founders Fund’s exit, some investors remain optimistic about the company’s future prospects. One trader, who requested anonymity, pointed out that the cryptocurrency market is notoriously unpredictable and that short-term fluctuations in price are to be expected. “ETHZilla is still a relatively new player in the market, and it’s not uncommon for companies in this sector to experience periods of volatility as they find their footing,” the trader said. “I wouldn’t read too much into this sell-off just yet.”

Overall, the news of Founders Fund’s exit from ETHZilla has generated mixed reactions from investors and analysts alike. While some view the move as a sign of trouble for the company, others see it as a strategic decision by Founders Fund to manage its risk exposure in a volatile market. Only time will tell whether this decision will pay off for Thiel’s fund in the long run.