ETHZilla Corporation, a publicly traded Ethereum treasury firm, has launched the first tokenized investment product backed by leased commercial jet engines. Through its newly formed subsidiary, ETHZilla Aerospace, the company introduced the "Eurus Aero Token I," a digital asset providing exposure to the cash flows from two CFM56 jet engines leased to a major U.S. airline.
The token, deployed on the Arbitrum Ethereum Layer 2 network, is priced at $100 each with a minimum investment of 10 tokens ($1,000). ETHZilla purchased the two engines for approximately $12.2 million. The investment structure targets an approximate 11% rate of return over the lease term, which extends into 2028. Monthly lease payments, consisting of base rent and usage fees, will be distributed on-chain to token holders via an ERC-20 framework.
Each token is secured by a collateral package that includes the physical aircraft engines, related lease receivables, reserves, and insurance proceeds. The engines are currently unlevered, and ETHZilla does not plan to add financing. The transaction includes a put/call option of $3 million per engine at the lease's end with the service provider, Aero Engine Solutions, which could potentially increase overall returns for token holders.
The token is available exclusively to accredited investors through the regulated platform Liquidity.io, in which ETHZilla holds a stake, and will follow Regulation D rules. ETHZilla Chairman and CEO McAndrew Rudisill stated the product "expands investment access and modernizes fractional asset ownership in markets that have historically been available only to institutional credit and private equity."
This launch marks a strategic pivot for ETHZilla, which has seen its share price (ETHZ) decline 31% over the past month despite a 5% bump on the news. The firm previously conducted a $250 million share buyback program and sold $40 million of its Ethereum holdings to repurchase shares as its market value fell below its net asset value. The company plans to expand its tokenized product line to include other real-world assets like manufactured home loans and car loans through partnerships with Zippy and Karus.
