On January 25, 2026, ETHZilla confirmed in a disclosure document that it has invested $12.2 million through its subsidiary to purchase two CFM56-7B24 aircraft engines, which will be leased to a major airline. This move sharply contrasts with its recent actions of selling approximately $114.5 million in ETH over the past few months. The Ethereum treasury company is clearing its on-chain chips while acquiring high-value physical assets, shifting towards the traditional financial sector of aircraft engine leasing. Meanwhile, ETHZilla's stock price has plummeted about 97% since its peak, raising market skepticism about its transition from "crypto to RWA": is this a passive self-rescue in a bear market, or a high-risk gamble? Surrounding the engine leasing and the upcoming RWA tokenization products set to launch in Q1, ETHZilla is attempting to build a safety net for its shaky valuation with a new narrative of "real-world cash flow + on-chain distribution," but the core question remains unresolved: how much cyclical pressure can this structure withstand?

From Selling Coins to Buying Engines: The Treasury's Bet on Offline Assets

● Transaction Structure and Asset Target: According to disclosed information, ETHZilla, through its wholly-owned subsidiary ETHZilla Aerospace LLC, has purchased two CFM56-7B24 engines for a total price of $12.2 million and has already leased them to a major airline. The CFM56-7B24 is one of the main engine models for narrow-body aircraft globally, with a mature secondary market and long operational history. ETHZilla's choice of this asset clearly bets on its stable demand in the traditional leasing market and relatively predictable depreciation curve.

● Migration of Assets from On-Chain to Offline: Corresponding to this acquisition, reports indicate that ETHZilla has sold approximately $114.5 million in ETH over the past few months, gradually reducing its direct exposure to Ethereum price fluctuations. This rhythmic reduction shifts the treasury, which was highly dependent on crypto asset valuations, towards a balance sheet supported by offline physical assets, reflecting the company's systematic restructuring of volatility, liquidity, and cyclical resilience in a bear market.

● Buy-Sell Options and Exit Expectations: This engine transaction also includes buy-sell option clauses, with documents showing an exercise price of $3 million for each engine. This design provides ETHZilla with a clear exit price anchor in the future, allowing it to lock in residual value after the lease expires while retaining some upside potential amid fluctuations in engine prices and the leasing market. This is a preemptive layout for asset exit paths and risk hedging, rather than a simple "buy and hold" heavy asset bet.

Aircraft Engine Leasing: The Logic of Crypto Companies Betting on "Cash Cows"

● Cash Flow Assets from a Traditional Financial Perspective: Aircraft engine and whole aircraft leasing are often viewed as "quasi-fixed income" assets in traditional asset management systems, with industry data showing that the annualized return in this market typically falls within the 8%-12% range. Its core appeal lies in long-term, renewable lease contracts and relatively rigid demand for air transport capacity, making the stability of cash flows significantly higher than most high-beta equities and commodity targets.

● Why Engines Instead of Real Estate or Consumer Credit: Compared to more common RWA targets like real estate and auto loans, engines have high individual value, strong global applicability, and a mature secondary leasing and resale market. A CFM56-7B24 can circulate among different airlines and fleets, possessing strong cross-regional liquidity and residual value management space. For crypto companies looking to allocate assets globally, such high-value, movable assets align better with their "light organization, cross-regional" operational characteristics than regionally strong real estate.

● On-Chain High Volatility vs. Offline Rental Risk-Return Comparison: Against the backdrop of severe pullbacks in mainstream assets like Ethereum and ETHZilla's stock price itself dropping 97%, continuing to hold a large ETH treasury means double volatility. In contrast, engine leasing provides predictable income primarily from rent. For the company, this represents a shift from relying on asset revaluation gains to depending on operational cash flows, using medium-yield, low-volatility offline assets to hedge against high-volatility, high-uncertainty on-chain revenue curves.

How the First Batch of RWA Tokenization Products Links to Engine Assets

● Existing Plans and Timelines: Before acquiring the engines, ETHZilla announced that it would collaborate with regulated brokers to advance the tokenization of auto and housing loans, with a timeline for launching the first batch of RWA products in Q1. This product line aims to split traditional credit assets into yield certificates that can be traded and allocated on-chain, providing a pathway for institutions and retail investors to access real assets.

● The Possibility of Engines as One of the Underlying Assets: After completing the acquisition of the two CFM56-7B24 engines and putting them into leasing, this portion of stable rental cash flow-generating physical assets has natural conditions to be included in the RWA product pool. ETHZilla can design divisible on-chain yield certificates around the rental and residual value income generated from engine leasing, slicing high-threshold aviation assets into smaller share products suitable for crypto investors, thereby enriching the underlying asset types of the first batch of RWA products.

● On-Chain Path and DeFi Connection Concept: From a technical and product perspective, putting cash flow-generating physical assets like aircraft engines on-chain requires first integrating offline lease contracts, asset valuations, and receivable rents into a verifiable on-chain structure, then connecting with existing DeFi infrastructure. Theoretically, these tokenized yield certificates could be used for collateral lending, yield farming, or as "quasi-fixed income" components in institutional portfolios, coupling with traditional on-chain revenue narratives to form a closed loop of "offline cash flow—on-chain liquidity."

Stock Price Plummets 97%: Market Distrust and the Dilemma of "Hedging + Opening Up"

● Stock Performance Reflects a Trust Crisis: According to public data, ETHZilla's stock price has retraced about 97% since its historical peak, a decline far exceeding most mainstream crypto assets, essentially representing a consistent vote of distrust from the market regarding its original business model and transformation path. For a company driven by treasury management and new narratives for valuation, such a deep stock price reset means that any new actions must be viewed through the lens of "rebuilding trust."

● Dual Attempt of "Hedging the Bear Market + Opening Up Revenue": Comments from Planet Daily view this engine investment as a "typical hedging strategy for crypto companies facing market downturn pressures," aiming to reduce sensitivity to crypto cycles with stable cash flow assets while also attempting to open a new revenue and narrative line through the combination with RWA tokenization. Analysts from Rhythm point out that putting cash flow-generating physical assets on-chain has the potential to change the operational methods of some traditional financial infrastructures, providing narrative increments for ETHZilla's strategy.

● Core Market Concerns and Scale Bottlenecks: Nevertheless, from an absolute scale perspective, a $12.2 million engine acquisition appears relatively limited compared to ETHZilla's past sale of $114.5 million in ETH and the overall company market capitalization. The mainstream concern is that such a single investment is unlikely to shake overall profit expectations in the short term, let alone bring significant changes to valuation models. In the absence of larger-scale asset allocations and clear profit guidance, the market may view this action as a "correct direction but insufficient strength" trial.

A Collective Experiment of Crypto Companies Moving Towards Traditional Asset Management

● Placing ETHZilla in a Larger Trend: In a broader industry context, ETHZilla is just a microcosm of many crypto-native enterprises. As the crypto market undergoes long-cycle adjustments, many project parties, protocols, and treasury management entities are beginning to attempt a transition to "diversified asset managers," moving some profits and reserves to traditional markets in hopes of navigating the crypto cycle. This path is both a realistic response to bear market pressures and a re-examination of the sustainability of their business models.

● Capability Boundaries and Structural Shortcomings: Compared to traditional asset management companies, crypto treasuries generally have experience gaps in risk control, compliance, and asset selection. Whether it’s aircraft engines or auto and housing loans, their assessment, due diligence, and risk monitoring rely on mature industry know-how and legal frameworks. Although ETHZilla is filling some compliance gaps through partnerships with regulated brokers, it still needs time to build a truly comparable capability system to traditional institutions in areas like major asset allocation and duration management.

● Potential Impact on Traditional Financial Infrastructure: Once crypto companies make progress in large-scale holdings and tokenization of real assets, traditional financial infrastructures—including custody, clearing, and asset services—will face new competition and collaboration opportunities. As analysts from Rhythm state, putting cash flow-generating physical assets on-chain could change the structural division of these infrastructures, forcing traditional institutions to reposition themselves in the competitive relationship with crypto enterprises from "disrupted" to "cooperative operators."

Bear Market Self-Rescue or Paradigm Shift: ETHZilla's Dual-Wheel Experiment

ETHZilla is attempting to build a dual-wheel drive structure of "real-world cash flow + on-chain distribution" through engine leasing + RWA tokenization: one wheel represents offline assets like the CFM56-7B24, providing relatively stable rental and residual income; the other wheel constructs RWA products around auto, housing loans, and even aircraft engines, introducing on-chain liquidity and new investors to these cash flows. The goal of this combination is to transition the company from a model solely reliant on ETH treasury valuation to a mixed model centered on cross-market cash flows and asset management fees.

From the perspective of the next few quarters, whether this strategy is sufficient to repair ETHZilla's financial performance and stock price expectations still depends on several key variables: whether the allocation scale of physical assets like engines can be rapidly expanded; how the market accepts the first batch of Q1 RWA products; and whether the company can avoid a new round of risks from aggressive expansion while its risk control and compliance foundations are not yet fully mature. At this stage, it resembles a mid-term experiment with a clear direction but unknown results, rather than a quick fix to change the valuation curve.

If the experiment succeeds, putting high-value assets like aircraft engines on-chain will provide a highly symbolic sample for the entire RWA track: crypto companies will no longer just be organizers of on-chain liquidity but will become the source and distributor of real asset cash flows. At that time, ETHZilla's choice may be retrospectively viewed as a paradigm shift in the survival mode of crypto enterprises—from "betting on coin prices" to truly cross-market asset management. But until then, the market will continue to use stock prices and capital flows to give the coldest real-time vote on this gamble from selling coins to buying engines.

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