The company ETHzilla has effectively closed the chapter on the 'crypto treasury' model. In December, it sold Ethereum worth approximately $74.5 million, directing most of the funds towards debt repayment. The decision highlights a shift in priorities: instead of accumulating digital assets, the focus is now on financial stability and balance control.
This is already the second major sale of ETH in a short period, making the strategic turnaround obvious rather than situational.
Why ETH has ceased to be a strategic asset
According to the reporting documents, ETHzilla sold about 24,300 ETH at an average price slightly above $3,000. The deal was related to the mandatory buyback of convertible notes, leaving the company no room for maneuver.
After the operation was completed, the remaining Ethereum balance was reduced to approximately 69,800 ETH, which is valued at around $200 million at current prices. Back in October, the company had already used ETH as a source of liquidity, selling about $40 million to finance a stock buyback.
At the time, the move elicited a mixed reaction from the market, but it is now clear: ETH is viewed as a financial management tool rather than a long-term asset to hold.
Balance is more important than accumulation
In summary, these actions demonstrate that ETHzilla is deliberately moving away from the idea of aggressively accumulating crypto assets. In the context of declining Ethereum prices and tighter financial conditions, the bet on 'holding ETH' has become too risky for a company with debt load.
Management makes it clear that it will continue to evaluate different sources of funding. This includes the possibility of new ETH sales or stock issuance if required by operational or investment plans.
Management reset
The financial turnaround is accompanied by changes in management. Two independent members with experience in institutional investments and capital allocation have joined the board of directors. This signals to the market that the company is betting on stricter control, transparency, and discipline in decision-making.
ETHzilla is also revising its operational focus. Instead of assessing through crypto treasury volumes, the company intends to shift towards infrastructure solutions and the tokenization of real assets.
Betting on RWA instead of volatility
The new strategy is centered around the tokenization of real assets. This includes loans, equipment, real estate, and other instruments that can generate predictable cash flow. The company expects that revenue and cash flow will become key drivers of business valuation, rather than the dynamics of Ethereum prices.
This approach reflects a broader shift in the industry. More and more public companies are moving away from the 'crypto as treasure' model and starting to use digital assets pragmatically as part of the financial toolkit.
How the market reacted to the decision
The community's reaction has been subdued. For many, the sale of ETH does not appear to be a bearish signal but rather a basic 'balance hygiene'. Analysts note that with ETH falling nearly 30% in recent months, maintaining large positions with debt becomes an unjustified risk.
At the same time, investors are closely monitoring the next stage. Selling an asset is easy, but building a sustainable revenue model based on the tokenization of real assets is more challenging. The implementation of this part of the strategy will be the main test for ETHzilla in the coming quarters.
Ultimately, the focus shifts from the sale of Ethereum itself to the question of whether the company can turn the strategic turnaround into stable revenue and long-term value for shareholders.
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