ETHZilla Buys $12.2M Jet Engines as 69,802 ETH Treasury Strategy Shifts

Ethereum treasury firm ETHZilla has snatched up two big commercial aircraft engines for a cool $12.2 million - all in cash...

Quick overview

  • ETHZilla has purchased two commercial aircraft engines for $12.2 million through a new subsidiary, ETHZilla Aerospace LLC.
  • The engines come with existing leases, allowing ETHZilla to generate immediate cash flow from the investment.
  • This marks a strategic shift for ETHZilla, moving from a passive treasury model to focusing on real-world asset tokenization.
  • Despite a challenging market, ETHZilla aims to stabilize returns and diversify revenue by leveraging its aerospace industry connections.

Ethereum treasury firm ETHZilla has snatched up two big commercial aircraft engines for a cool $12.2 million – all in cash – according to a regulatory filing that dropped on Friday. But get this – they didnt just buy them straight up, they did it through a brand new subsidiary called ETHZilla Aerospace LLC – basically a side hustle set up to make some real-world moves. This is the company’s first big bet outside of the digital asset space.

The engines themselves are pretty powerful, and they come with existing leases with a major airline, which means ETHZilla can start raking in serious cash right off the bat. Where did this cash come from, you ask? Well, it seems the company sold off a chunk of its cryptocurrency holdings – a pretty big shift from their former passive treasury model, and more of an operating asset play.

It looks like ETHZilla is getting its priorities straight and making real-world asset tokenization its top focus – basically, taking physical assets and syncing them with blockchain infrastructure.

Tokenization Focus Heads for Aerospace

Last December, ETHZilla’s Chairman and CEO, McAndrew Rudisill, told the world that the firm is getting into operating businesses to “bring real-world assets on-chain through tokenization” and ditching the whole holding-Ether thing. Now, it seems the company is putting its money where its mouth is and actually building a whole new business around this concept.

Rudisill highlighted that the company will start with aerospace assets like aircraft engines and airframes – these are the foundation of the firm’s tokenization strategy.

Here are the things we know about ETHZilla’s strategy so far:

  • First off, they’re gonna focus on aircraft engines and airframes.
  • They’re gonna use the connections they have in the aerospace industry.
  • Theyre not gonna partner up with anyone to get the assets they want

“Weve got people on our team and on our board who actually know people in the aerospace industry”, Rudisill said – and these connections are gonna help build an initial pipeline of assets that are suitable to be tokenized.

The engine deal gives them not just some recurring lease cash, but also a real-world base to represent future on-chain assets.

Share and Ether Prices Continue to Tank

ETHZilla is trying out this new strategy at a pretty tough time – both the company’s stock price and the rest of the crypto market are getting hammered. ETHZ (ETHZ) went through the roof last year during that crypto rally, even peaking above $100 back in August – but since then it’s fallen a whoppin 95% – closing at just $5.24 on Friday according to Google Finance.

Ether has had a similar ride – ETH is currently trading near $2,800, which is down over 40% from its August all-time high of nearly $5,000.

Despite the super bad time the market is having, ETHZilla remains one of the biggest corporate Ethereum holders out there – they hold:

  • A mighty 69,802 ETH
  • Worth a cool $198.5 million at today’s prices according to CoinGecko.

It looks like the move into leased aerospace assets is a bid to stabilise returns, generate more diversified revenue, and generally cut the company down to size in terms of crypto price volatility.

ABOUT THE AUTHOR See More
Arslan Butt
Lead Markets Analyst – Multi-Asset (FX, Commodities, Crypto)
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics. His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker. His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

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