ETHzilla Corporation (Nasdaq: ETHZ) has sold roughly $40 million worth of Ethereum (ETH) from its treasury to fund a major stock buyback program, rattling parts of the crypto community and sparking debate among retail traders frustrated by the firm’s recent debt increase and reverse stock split.
Breaking the DAT Mold: ETHzilla Sells Crypto to Boost Its Own Shares
The decentralized finance (DeFi) firm announced Monday that it had offloaded around $40 million in ETH to support a $250 million share repurchase initiative approved by its board.
As of October 24, ETHzilla had repurchased about 600,000 shares worth approximately $12 million, citing that its stock was trading at a “substantial discount” to its net asset value (NAV).
“We’re leveraging the strength of our balance sheet — including a reduction in ETH holdings — to execute these buybacks,” said McAndrew Rudisill, ETHzilla’s Chairman and CEO.
“We expect the program to immediately deliver accretive value by raising NAV per share while reducing the float available for shorting and lending.”
The market seemed to agree. ETHZ shares jumped 32% this week, adding another 14% on Monday alone following the announcement.
A Bold Financial Play in the DeFi Era
Despite the ETH sale, ETHzilla still holds around $400 million worth of Ethereum to fund future strategic initiatives, with a portion of those assets currently locked. The company noted it will continue trimming its ETH position to finance buybacks until its share discount to NAV “normalizes.”
The stock had fallen in recent weeks after the firm announced a 1-for-10 reverse stock split, which drew skepticism from parts of the market. But this new move—selling crypto reserves to fund traditional equity repurchases—marks a rare crossover between DeFi and Wall Street-style capital management.
Retail Traders React: “So Much for Decentralization”
Not everyone was impressed. On social media, retail traders mocked the company’s strategy:
“Sell $40M → Buy back shares → ETHZILLA goes full Wall Street. Decentralized… kinda,” one user quipped.
It’s not every day a Digital Asset Trust (DAT) sells its own crypto holdings to boost equity value. ETHzilla may have just rewritten the unwritten rules of digital finance — and in doing so, reignited the debate about what “decentralization” really means in a corporate setting.
Bridging TradFi and DeFi
ETHzilla maintains that it remains committed to its hybrid vision, positioning itself as a bridge between traditional finance (TradFi) and decentralized finance (DeFi). The firm continues to offer tokenization services, blockchain analytics, and Ethereum-based infrastructure solutions—even as it adjusts its financial strategy.
Rudisill reiterated that the company’s balance sheet remains strong and that its long-term focus on innovation within the Ethereum ecosystem has not changed.
For now, the market is divided — but one thing is clear: ETHzilla has broken convention by doing what few digital asset companies dare — using its crypto to play the corporate game.
