 ▲ Ethereum (ETH), Bitcoin (BTC) |
Founders Fund, the venture capital firm led by Peter Thiel, has halted its large-scale betting strategy on Ethereum (ETH) and begun restructuring its portfolio to focus on Bitcoin (BTC).
According to cryptocurrency media outlet Cointelegraph on March 4 (local time), Founders Fund recently sold off or closed a significant portion of its Ethereum holdings. At the end of 2023, the firm purchased approximately $200 million worth of digital assets, investing $100 million each in Bitcoin and Ethereum. However, within months, it significantly reduced its exposure to Ethereum. The decision is seen as a strategic move to improve profitability as Ethereum’s price gains have markedly lagged behind Bitcoin.
Behind Founders Fund’s withdrawal from Ethereum are doubts about its value proposition. While Peter Thiel has long praised Bitcoin as “digital gold” and expressed strong confidence in it, he has reportedly maintained a skeptical stance regarding Ethereum’s “world computer” vision from an investment return perspective. In particular, while Bitcoin attracted substantial institutional capital and staged a standout rally following the launch of spot ETFs, Ethereum has faced limitations including regulatory uncertainty and slowing ecosystem growth.
From a technical analysis standpoint, Ethereum has also remained weak against Bitcoin. The ETH/BTC price ratio has been in a downward trend for months, reflecting declining investor interest. Experts warn that if the “rotation” phenomenon—where major capital such as Founders Fund exits Ethereum positions in favor of Bitcoin—intensifies, Ethereum’s price recovery could be further delayed.
Founders Fund’s move is seen as a symbolic example of deepening polarization among assets within the digital asset market. Institutional investors are increasingly concentrating on Bitcoin, which holds the strongest narrative and liquidity, rather than broadly investing across the crypto market. The firm is reportedly planning to maintain Bitcoin as its core asset going forward while responding to market volatility.
The Ethereum ecosystem is said to be tense following news of Founders Fund’s exit. The withdrawal of capital by a major venture capital firm could send negative signals to other investors. There are growing calls that for Ethereum to regain institutional favor, it must not only deliver technical upgrades but also prove a clear investment value differentiated from Bitcoin.
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