Ethereum News Today: ETHZilla's Buyback Gamble: Can Crypto-Treasury Strategy Justify Sky-High Valuation?

ETHZilla Corporation (Nasdaq: ETHZ), a technology firm bridging traditional finance and decentralized finance (DeFi), has sold approximately $40 million of its Ethereum (ETH) treasury holdings to fund a stock repurchase program. The company announced the move on October 27, 2025, stating it has already repurchased 600,000 shares for $12 million under its $250 million buyback authorization. CEO McAndrew Rudisill emphasized that the strategy aims to capitalize on the stock's significant discount to net asset value (NAV), which he called "immediately accretive," according to a MarketScreener report. ETHZilla plans to continue selling ETH to repurchase shares until the discount normalizes, while retaining about $400 million in ETH for future initiatives, per a PR Newswire release.

The stock buyback follows a broader strategic shift for ETHZilla, including a $15 million investment in Satschel, Inc., parent of regulated trading platform Liquidity.io. The partnership grants ETHZilla a 15% equity stake and exclusive rights to list Ethereum Layer 2 tokens on Liquidity.io's platform, positioning the company to expand its real-world asset tokenization efforts, as noted by Yahoo Finance. Analysts suggest this collaboration could address past criticisms of limited market access and open new revenue streams, though the firm remains unprofitable with minimal reported earnings, according to a Simply Wall St analysis.

ETHZilla's recent share price volatility has also drawn attention. The stock surged 17.38% in a single day following the Satschel deal and additional strategic moves, including a 1-for-10 stock split and the appointment of John D. Kristoff as Senior Vice President of Corporate Communications and Investor Relations, as reported in a Simply Wall St report. However, the company's price-to-book (P/B) ratio of 53.7x—well above industry peers—has raised questions about valuation sustainability. Critics argue the high P/B reflects speculative bets on future growth rather than current financial performance, a point highlighted in the Simply Wall St analysis.

The crypto-treasury stock model, which ETHZilla exemplifies, is facing broader scrutiny. Over 25% of public companies adopting this strategy now trade at valuations below their digital asset holdings, according to K33 Research, as noted in a Barron's article. As crypto prices fluctuate, firms like ETHZilla may face pressure to liquidate assets to cover costs, potentially triggering downward spirals. Kerrisdale Capital analysts called the premium pricing of crypto-treasury stocks a "fantasy," noting rivals can replicate the model and ETFs offer cheaper exposure, the Barron's piece added.

ETHZilla plans to release third-quarter 2025 earnings on November 14, 2025, with management set to discuss operational updates during a webcast, the Simply Wall St report said. Investors will be watching whether recent strategic actions translate into tangible revenue growth or stabilize the company's volatile share price. For now, ETHZilla's dual focus on DeFi expansion and NAV normalization through buybacks defines its path forward, though risks—including dilution and regulatory uncertainties—remain significant, the Simply Wall St report noted.