Peter Thiel: From PayPal's "Godfather" to a Major Player Behind the Crypto Industry

BitMine, a publicly listed US mining company, has garnered widespread market attention for becoming the world's largest enterprise holder of Ethereum. With the release of on-chain data, a new round of discussion has begun regarding the role and influence of institutions in crypto asset allocation. Besides BitMine Chairman Tom Lee, who frequently garners media attention for his enthusiastic support of ETH, another name has been frequently mentioned behind the scenes: Peter Thiel.

As one of Silicon Valley's most controversial and forward-thinking investors, Thiel expressed an early interest in Bitcoin and the potential of decentralization, and has made numerous bets on the crypto industry through his funds. Thiel's investment trajectory not only reflects his judgment of future technological trends but also, to a certain extent, has shaped the current landscape of the crypto market.

The Godfather of the PayPal Mafia

If one were to identify a central figure in the story of the infamous "PayPal Mafia," its "Godfather," Peter Thiel, would undoubtedly be the perfect fit.

In 1998, Thiel co-founded Fieldlink with Max Levchin, Luke Nosek, and others, later renaming it Confinity. Due to the lack of commercial success of its development of security software for handheld devices, the company quickly shifted its focus to digital wallets, launching the first version of the PayPal electronic payment system in 1999. In March 2000, Confinity merged with X.com, the online financial services company founded by Elon Musk and others, and officially became PayPal in June 2021.

In 2002, eBay announced its acquisition of the recently public company in an all-stock transaction for approximately $1.5 billion. As co-founder and first CEO, Peter Thiel achieved his first significant financial success.

Thiel and Max

After the sale of PayPal, members of the "PayPal Mafia" dispersed across Silicon Valley, sparking a new wave of entrepreneurship and investment. Among them, Thiel's $500,000 convertible bond investment in Facebook in 2004 is often considered one of Silicon Valley's most iconic early investments. At the time, Facebook's valuation was only $4.9 million. As Facebook's first outside investor, Thiel acquired a 10.2% stake and joined the company's board of directors. After Facebook went public in 2012, Thiel subsequently cashed out over $1.1 billion.

Thiel's venture capital career actually began as early as 1996. Back then, he raised $1 million with the help of friends and family and invested $100,000 in his friend Luke Nosek's web calendar project, which failed. Later, at the suggestion of Luke's friend Max Levchin, Thiel and several others co-founded the cryptography company Fieldlink, which later evolved into PayPal.

After years in Silicon Valley and his successful investment in Facebook, Thiel began to reshape his investment vehicles and philosophy. In 2005, he co-founded Founders Fund with Luke Nosek and other former partners, initially focusing on defense-related startups and technologies. Palantir, the data company Thiel founded in 2003, also focused on counterterrorism and fraud prevention as early applications and quickly grew into a key data infrastructure provider for the US government and large institutions.

Palantir's stock price has increased 20-fold in the past five years, earning it the title of a "national fortune stock."

Following Facebook's enormous financial success, Founders Fund shifted its focus to hard technology, aiming to support startups with the potential to "elevate civilization to a new level." In addition to Facebook, Thiel has made early investments in numerous leading companies in various fields, including Airbnb, LinkedIn, SpaceX, Stripe, and DeepMind, both personally and through Founders Fund.

Notably, in 2002, Thiel also ran Clarium Capital, an investment management and hedge fund implementing global macro strategies. Its assets under management soared to $8 billion in 2008, but a series of unprofitable investments and client redemptions subsequently caused its assets under management to shrink to approximately $350 million in 2011. From the founding and sale of PayPal, to his legendary early investment in Facebook, to the formation of Founders Fund and Palantir, Thiel essentially completed his transformation from entrepreneur to angel investor to venture capital partner to industry influencer in the first decade of the 21st century. This journey accrued considerable capital, connections, and the ability to stay at the forefront of technology, quietly paving the way for his near-future entry into the crypto world.

Making a $1.8 Billion Profit During the Crypto Cycle

Among Silicon Valley investors, Thiel was one of the earliest and most prominent to intersect with the cryptocurrency and blockchain industries.

In September 2014, Thiel announced the latest cohort of the "Thiel Fellowship," a group of 20 young individuals, including then-20-year-old Ethereum co-founder Vitalik Buterin. Launched in 2010 by Thiel through the Thiel Foundation, the two-year entrepreneurship grant program is open to individuals aged 22 and under who do not yet have a college degree, encouraging them to drop out of school to pursue entrepreneurship or research. In addition to cash funding, the program also provides mentorship and network support, without taking equity in the founder's company. With the rapid development of Ethereum, Vitalik quickly became the face of the Thiel Fellowship.

Vitalik Buterin introduced Ethereum at the 2014 Miami Bitcoin Summit.

Even before funding Vitalik, Thiel had already demonstrated his interest in and support for the early blockchain industry. In 2013, Founders Fund led a $2 million seed round for the crypto payments company BitPay. At the time, crypto payments were still in their very early stages, and the move was interpreted as a sign that top Silicon Valley funds were beginning to explore crypto applications on the "payment side," betting on their regulatory compliance and merchant acceptance.

Other well-known investments by Thiel in the cryptocurrency industry are Block.one, the parent company of the public blockchain project EOS, and Bullish, the crypto exchange launched by Block.one in 2021. In 2018, Block.one announced strategic investment from investors including Peter Thiel and Bitmain. In 2021, Block.one spearheaded the incubation of Bullish, an institutional crypto trading platform, with a reported investment of approximately $10 billion. Peter Thiel, Alan Howard, and Louis Bacon were listed as key early backers.

In 2019, mining infrastructure company Layer1 announced $50 million in funding, with Peter Thiel as one of its investors. Layer1 aims to build comprehensive capabilities in the United States, from power and chips to self-built mining farms, which aligns with Thiel's consistent investment preference for "infrastructure and upstream control."

In addition to supporting early-stage crypto projects as an investor, Thiel's returns from direct cryptocurrency investments may be even more impressive. According to Reuters, Founders Fund, one of the earliest institutional cryptocurrency investors, began purchasing large amounts of Bitcoin as early as 2014 and liquidated them before the 2022 cryptocurrency market crash, earning a massive return of approximately $1.8 billion. Furthermore, sources claim that Founders Fund resumed its cryptocurrency investments in the summer of 2023, investing $200 million in BTC and ETH over several months. Reuters was unable to obtain the average price of these purchases, but BTC was trading below $30,000 at the time, while ETH was fluctuating between $1,500 and $1,900. Reuters commented, "This fondness for cryptocurrencies aligns with the billionaire's interest in libertarianism, small government, and technological innovation."

Increasing Cryptocurrency Investment

In recent years, Thiel has repeatedly championed Bitcoin. Publicly, he has repeatedly praised Bitcoin's "digital gold" qualities, calling it a hedge against inflation and central bank policies. In October 2021, at an event hosted by the Lincoln Network in Miami, Thiel was invited to speak on cryptocurrencies, central banks, and macroeconomic issues. He expressed his feeling underinvested in Bitcoin, stating, "All you have to do is buy Bitcoin."

Thiel's words have proven true. In recent years, Thiel appears to have increased his investment in cryptocurrencies, with his Founders Fund's investment strategy and focus shifting towards crypto.

Thiel lavished praise on Bitcoin at the 2022 Bitcoin Conference in Miami, Florida.

In May 2023, former Pantera co-chief investment officer Joey Krug joined Founders Fund as a partner. Speaking on the X platform, Krug stated, "I will focus on developing Founders Fund's crypto strategy for the next decade, while also identifying the next wave of crypto startups and founders worthy of support." With Krug's arrival, Founders Fund began shifting towards treating crypto as a regular investment category.

Amid the surge in public companies' crypto treasuries, Thiel once again emerged as a "behind-the-scenes winner." In mid-2025, Bitcoin mining company Bitmine Immersion Technologies announced a shift in its "Treasury" strategy toward Ethereum (ETH), appointed Fundstrat co-founder and renowned macro analyst Tom Lee as chairman, and launched a $250 million private placement. In mid-July, Thiel, one of the company's largest shareholders, disclosed a stake of approximately 9.1%. Following the announcement, the company's stock price rose nearly 15% in early trading.

According to data from StrategyEthreserve, Bitmine, a US-listed company, now holds approximately 1.2 million Ethereum, with a market value exceeding $5 billion. This positions it first among Ethereum treasury companies, significantly ahead of second-place Sharplink Gaming, which holds approximately 728,800 Ethereum, valued at approximately $3.25 billion.

Furthermore, Thiel's early investment four years ago is beginning to pay off. In August 2025, Bullish was listed on the New York Stock Exchange and saw a significant surge in its stock price on its first day of trading, marking the official realization of Thiel's long-term bet on "institutional trading infrastructure" in the public capital markets.

Power Broker: Thiel's Political Influence

Beyond his commercial success in fintech and cryptocurrency, Peter Thiel's influence has also reached the heart of power in Washington. As a "tech supercapitalist," Thiel's role in American politics is undeniable. He has long cultivated influence in the White House and Congress by funding candidates and establishing connections between government and business.

As one of the few Republican supporters in Silicon Valley, he openly supported Trump during the 2016 presidential election. While Thiel's high-profile support was unusual in a Silicon Valley environment where nearly everyone opposed Trump, as a self-proclaimed liberal and a believer in capitalism, he also valued Trump's anti-establishment stance.

Thiel has also been active in political donations and networking. In 2016, as a key ally of Trump, Thiel donated $1.25 million to the Trump campaign and became a member of the presidential transition team.

In addition, the Los Angeles Times noted that he has long invested in Republican candidates, particularly a new generation of conservative politicians with ties to the tech industry. For example, he donated a record $15 million to his protégé, former employee and current Vice President JD Vance, the largest single donation ever made by a single individual in an Ohio Senate race. He also introduced Vance to Trump, helping Vance secure Trump's endorsement and indirectly securing a "golden partner" for Trump's subsequent presidential campaign and second term.

Thiel, JD Vance, and Trump

Another Silicon Valley upstart, Blake Masters, former COO of Thiel's foundation and co-author of Thiel's entrepreneurship book, "Zero to One," also received funding and support from Thiel, collaborating on his political career. Thiel contributed over $10 million to super PACs supporting both candidates.

Several major US media outlets have described Thiel as a "power broker" or "financier" in the Republican tech world. Business Insider even called him the "King of the Republican Party," an early Trump supporter who became the first Silicon Valley tech investor to make a donation in 2016.

It's worth noting that Thiel's attitude toward the Trump campaign has shifted somewhat. In a 2023 report from The Guardian, Thiel told The Atlantic that his decision to support Trump was a "half-hearted cry for help" and that things were "far more crazy and dangerous than we had imagined."

The report also stated that Trump was upset when Thiel was turned down earlier in 2023 when he called to solicit $10 million. Ultimately, Thiel did not participate in funding the 2024 political campaign.