Ethereum-focused digital asset treasury firm ETHZilla recently sold roughly $40 million worth of ETH from its holdings, using a portion of the proceeds to repurchase around 600,000 of its own shares for $12 million.
The firm plans to continue selling ETH to fund further repurchases until the gap between its stock price and net asset value (NAV) narrows. This move is part of a broader $250 million buyback program approved by the company’s board.
Despite the sale, ETHZilla still holds approximately $400 million in ether, maintaining a significant treasury position.
ETHZilla move
The timing of the ETH sale saw the token trading around $3,900, with prices climbing over the weekend to $4,250 before settling near $4,150. While the sale may have occurred at a temporary discount, the buyback signals to the market that the company is actively managing its shares and supporting its stock price.
Following the announcement, ETHZilla shares jumped 14.5% on Monday, with additional gains in after-hours trading. The move highlights the pressure digital asset treasury firms face as many of their stocks now trade below the value of the crypto they hold. ETHZilla itself has seen a nearly 90% drop from its August peak, trading at a 30% discount to NAV.
Chairman and CEO McAndrew Rudisill explained that the strategy aims to reduce the number of shares available for borrowing or short-selling while increasing NAV per share, reinforcing confidence among investors and stakeholders in the company’s long-term position.
Corporate treasury trends
Corporate involvement in digital assets has expanded steadily, with firms increasingly including cryptocurrencies like Bitcoin and Ether as part of their treasury strategy.
According to Bitwise’s Q3 2025 Corporate Bitcoin Adoption Report, publicly traded companies holding Bitcoin increased by 38% during the quarter, totaling 172 firms with a combined treasury value of approximately $117 billion.
These figures show a trend where corporations actively manage digital assets not just as speculative tools but as strategic reserves to diversify portfolios and hedge against macroeconomic risks. ETHZilla’s recent buyback strategy aligns with this broader institutional approach, emphasizing proactive treasury management in volatile markets.
NAV vs. Market Price. Understanding the gap
ETHZilla's stock trading below its net asset value (NAV) exemplifies a prevalent scenario among digital asset treasury firms. When a company's market price falls beneath the value of its underlying crypto holdings, initiating share buyback programs can serve as a strategic move to stabilize share prices and reinforce investor confidence.
Industry analysts note that such measures can reduce the number of shares available for borrowing or short-selling, thereby increasing NAV per share. This approach signals to long-term shareholders that the company is actively managing its treasury assets, even amidst market volatility.
However, it's important to recognize that while buybacks can be effective in the short term, they may not address underlying issues such as declining investor sentiment or operational challenges. As highlighted by financial experts, relying solely on buybacks without addressing core business fundamentals can lead to unsustainable practices and potential long-term risks.
Edward Carroll, head of markets at MHC Digital Group, said corporate accumulation is creating a supply-demand imbalance that could fuel medium-term price growth.
“The surge in institutional interest will likely put firm upward pressure on Bitcoin over the coming years,” Carroll said. “We expect demand to remain steady and increasing as BTC decouples from broader risk sentiment.”
For instance, Empery Digital, another firm in the digital asset treasury space, has faced similar challenges. Despite initiating a share repurchase program, analysts caution that such measures might not be sufficient if the company's underlying business model does not adapt to changing market conditions.
Therefore, while ETHZilla's buyback strategy may offer immediate relief by narrowing the NAV discount, it underscores the broader challenges faced by digital asset treasury firms in maintaining investor trust and ensuring long-term viability.
Oleksii Shumak
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