ETHZilla announced exiting its digital asset treasury (DAT) strategy. The company has sold $74.5 million in Ether to pay down debt and pivot to real-world asset (RWA) tokenization.
ETHZilla shared the news on a post on X. It wrote, “The Company believes its value will be driven by revenue and cash flow growth from our RWA tokenization business.”
Moreover, the company is discontinuing the mNAV dashboard on its website effective today. But it will continue to provide periodic balance sheet updates to investors.
Less than six months ago, ETHZilla shifted to an Ethereum-based digital asset treasury. The Peter Thiel-backed company said it currently holds 69,802 ETH worth around $207 million.
ETHZilla sells Ethereum to pay debt
According to the X post, the former biotech company stated that it was selling Ethereum to pay debt.
The firm wrote, “As part of redeeming our outstanding senior secured convertible notes, ETHZilla sold 24,291 ETH for approximately $74.5 million.” It continued, “We plan to use all, or a significant portion, of the proceeds to fund the redemption.”
The company explained that its public dashboard does not include balance sheet cash. This cash will be used to complete early redemptions on December 24 and December 30.
ETHZilla was known before as 180 Life Sciences, a Nasdaq-listed biotech firm. The company liquidated $40 million worth of Ethereum coins in October. It used the proceeds in a $250 million stock repurchase plan.
In July, 180 Life Sciences raised $425 million through a PIPE deal with more than 60 investors. The funding supported the company’s move to an Ether digital asset treasury strategy.
During that time, small-cap Nasdaq-listed companies followed the DAT trend. The goal was to copy Michael Saylor’s Bitcoin strategy.
As part of redeeming our outstanding senior secured convertible notes, ETHZilla sold 24,291 ETH for approximately $74.5 million. We plan to use all, or a significant portion, of the proceeds to fund the redemption. The dashboard below excludes cash on the balance sheet which… pic.twitter.com/c5HMDrf48X
— ETHZilla (@ETHZilla_ETHZ) December 22, 2025
DAT strategy loses steam
But the digital asset treasury trend began to show clear weakness. Several major DAT firms have seen their mNAV ratios fall from above 1.5 to 1.0 or below. This means their shares trade at discounts to the value of their crypto holdings.
mNAV stands for multiple of net asset value. It shows how a company’s market capitalization relates to the value of its crypto holdings.
The basic mNav of Nakamoto Holdings, formerly KindlyMD, fell to 0.378 based on data from BitcoinTreasuries. In November, the company faced two collateral calls in one week on its $250 million Bitcoin-backed debt.
DAT executives do not rely on product or service sales. They believe holding large BTC, ETH, or SOL balances enables firms to expand their crypto positions. This expansion is achieved through leverage.
The DAT strategy appears to be losing momentum. Analysts now view digital asset treasuries as the bubble of this market cycle.
ETHZilla moves into RWAs full time
ETHZilla intends to adopt a real-world asset approach by creating tokens for assets like car loans, mobile home loans, aerospace machinery, and property.
The company has entered into multiple agreements with Zippy, Inc. to bring manufactured home loans on-chain as tokenized RWAs. Zippy operates a digital lending platform focused on institutional markets.
Under the agreements, ETHZilla will acquire a 15% fully diluted stake in Zippy. The deal includes $5 million in cash and $14 million in ETHZilla common stock, subject to certain cash true-up provisions. An additional $2.1 million in common stock will be issued to select Zippy shareholders.
At the time of writing, the ETHZilla stock, ETHZ, sank by 8.70% and currently trades at $6.30. On the other hand, Ethereum is in the green zone. The coin is priced at $2,989.71, and it’s up by 2.1% in the last seven days.
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