TLDR
- ETHZilla authorized a $250 million share repurchase program running until June 2026
- Company holds 102,237 ETH worth approximately $489 million at current prices
- Average purchase price for ETH holdings was $3,948.72 per token
- ETHZilla introduced Electric Asset Protocol to generate higher yields on crypto reserves
- Stock dropped 30% Friday after disclosure of potential 74.8 million convertible share offering
ETHZilla has approved a $250 million stock buyback program as the company continues expanding its ethereum treasury strategy. The Florida-based firm announced the repurchase authorization on Monday.
The buyback program takes effect immediately and runs until June 30, 2026. The company will repurchase shares until the full $250 million is spent or the deadline arrives.
ETHZilla currently holds 102,237 ETH tokens acquired at an average price of $3,948.72 each. The company spent over $403 million building this position over recent weeks.
At current ethereum prices around $4,575, the holdings are worth approximately $489 million. This represents a paper gain of roughly $86 million from the original purchase cost.
The company also maintains about $215 million in U.S. dollar cash equivalents. ETHZilla has 165.4 million shares outstanding as of August 22.
Treasury Strategy Expansion
ETHZilla recently pivoted from biotechnology to cryptocurrency focus after rebranding from 180 Life Sciences. The strategic shift helped revive the company’s previously struggling stock price.
Executive Chairman McAndrew Rudisill said the buyback program demonstrates commitment to shareholder value. He emphasized the company’s plans to scale ETH reserves while pursuing yield opportunities.
The company introduced its proprietary Electric Asset Protocol designed to generate higher returns on crypto holdings. ETHZilla plans to stake its most recent ETH purchases with Electric Capital.
ETHZilla joins other public companies building ethereum treasuries including BitMine Immersion Technologies and The Ether Machine. These firms view ETH as a strategic balance sheet asset.
Market Reaction and Risks
ETHZilla shares fell nearly 30% on Friday following disclosure of a potential convertible share offering. Shareholders filed to offer up to 74.8 million convertible shares.
The stock traded around $3.15 at publication time, down 4.5% from previous levels. Market volatility reflects investor uncertainty about the company’s financing strategy.
Analysts warn that leverage-heavy crypto treasury strategies carry substantial risks. Companies borrowing to accumulate digital assets could face difficulties during market downturns.
Financial Background
ETHZilla operates with weak underlying fundamentals as a public company. The firm reported limited revenues and persistent losses in recent financial statements.
Last year alone, the company accumulated a deficit exceeding $141.5 million. This financial position raises questions about the sustainability of aggressive crypto acquisition strategies.
Market experts compare current crypto treasury trends to earlier corporate gold adoption waves. However, the leverage component creates additional complexity and risk factors.
Industry observers note that roughly 3.4% of ethereum’s total supply is now held by corporate treasury entities. This concentration could create price volatility during market stress periods.
ETHZilla’s most recent ETH purchases will be staked with Electric Capital as part of the company’s yield enhancement strategy.
