ETHZilla moves residential mortgages on-chain, targeting transparency, steady yields, and faster settlement through Ethereum Layer 2 infrastructure.
ETHZilla Corporation has tokenized a $4.7M US home loan portfolio on Ethereum Layer 2. The move represents a fairly clear pivot to real-world asset tokenization. Moreover, the firm wishes to bring together the efficiency of blockchain and the stability of traditional private credit.
ETHZilla Expands Into Tokenized Real-World Assets
ETHZilla (Nasdaq: ETHZ) bought 95 manufactured and modular home loans. The cost of the portfolio amounted to $4.7M, according to an official statement. Previously, the firm had been mainly focused on Ethereum-based treasury strategies, as well as crypto-native yields.
ETHZilla to tokenize a portfolio of 95 home loans yielding 10.36% annually as it expands beyond Ethereum treasury management https://t.co/TZBM810J40
— The Block (@TheBlock__) February 5, 2026
However, the company now intends to turn the loans into a financial product tokenized. The assets will be based on the Ethereum Layer 2 network. This setup facilitates faster transaction time and lower transaction costs as compared to Ethereum mainnet.
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Importantly, the tokenized portfolio supports onchain tracking and automated cash flow distributions. ETHZilla anticipates a yield close to 10.36% per annum on the loans. Meanwhile Zippy Loans, LLC will continue servicing the mortgages after tokenization.
The firm clarified that the product will be launched on Liquidity.io. The period of expected launch is between late February and early March. Therefore, access to the secondary market may not be far away for qualified participants.
According to ETHZilla, the portfolio consists of diverse residential borrowers in the United States. The loans are guaranteed with manufactured and modular homes. These assets often offer more in the way of yields than conventional mortgages.
Institutional Shift Toward Onchain Private Credit
This development represents a general institutional trend towards onchain finance. Increasingly, traditional assets are being put on the blockchain rails by firms. Ethereum Layer 2 networks now have the support of scalable and compliant financial structures.
Previously, onchain treasuries had a strong dependence on crypto-native income. Examples were ETH Staking or DeFi liquidity pools. However, such yields tend to fall during bear markets.
By contrast, real-world assets earn profits from the off-chain economy. Mortgage interest is fairly stable in spite of crypto-volatility. Therefore, tokenized private credit can provide a yield floor in times of downturn.
Market data indicates that the yield on private credit typically falls between 7% and 12%. ETHZilla’s projected 10.36% is in this range. These returns are often higher than US Treasury yields in return for higher risk premiums.
In addition, tokenized loans can lead to better collateral efficiency. Firms can use these assets to borrow or mint stablecoins. As a result, capital can be kept in liquid form but still earn some yield. On the other hand, tokenized real world assets crossed $8B in total value in 2024. Residential credit is a growing segment in this market.
ETHZilla’s strategy is in line with this momentum. The firm now removes itself from being a pure crypto treasury, but it presents itself as a real-world asset participant. As a result, this move could attract crypto-native and traditional investors.
Overall, the tokenization attempt undertaken by ETHZilla points to blockchain’s growing role in private credit. As infrastructure matures, larger numbers of housing assets may migrate onchain. This movement has the potential to transform liquidity, transparency, and yield access throughout global finance.