Peter Thiel: From PayPal "Godfather" to a Major Player Behind the Scenes in the Encryption Industry

Author: Zen, PANews

The US-listed mining company BitMine has attracted widespread attention in the market for becoming the world's largest enterprise-level Ethereum holder. With the disclosure of on-chain data, a new round of discussions has emerged regarding the role and impact of institutions in cryptocurrency asset allocation. Besides Tom Lee, the chairman of BitMine's board who is always in the media spotlight fervently "supporting" ETH, another name has been frequently mentioned behind this wave of enthusiasm - Peter Thiel.

As one of Silicon Valley's most controversial and forward-looking investors, Thiel showed early interest in Bitcoin and the potential of decentralization, making multiple bets in the crypto industry through his fund. Thiel's investment trajectory not only reflects his assessment of future technological trends but has also, to some extent, shaped the landscape of today's crypto market.

PayPal Godfather

If we were to find a central figure for the story of the infamous "PayPal Mafia," its "godfather," Peter Thiel, is obviously the most suitable.

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

In 2002, eBay announced its acquisition of this newly listed company for about $1.5 billion in an all-stock deal, marking a significant wealth leap in Peter Thiel's life as the co-founder and first CEO.

After PayPal was sold, members of the "PayPal mafia" dispersed throughout Silicon Valley, launching a new wave of entrepreneurship and investment. Among them, Thiel invested $500,000 in convertible debt in Facebook in 2004, which is often considered one of the most representative cases of early investment in Silicon Valley. At that time, Facebook was valued at only $4.9 million. As the first external investor in Facebook, Thiel acquired 10.2% of the shares and joined the company's board of directors. After Facebook went public in 2012, Thiel successively cashed out over $1.1 billion.

In fact, as early as 1996, Thiel began his venture capital career. At that time, he raised $1 million with the support of friends and family, investing $100,000 in his friend Luke Nosek's online calendar project, which ended in failure. Subsequently, on the advice of Luke's friend Max Levchin, he partnered with a few others to create a cryptography-related company called Fieldlink, which later transformed and ultimately became PayPal.

After years of exploration in Silicon Valley and successfully investing in Facebook, Thiel began to reshape his investment vehicle and philosophy. In 2005, he co-founded Founders Fund with old partners like Luke Nosek, which initially focused on defense-related startups and technologies. Thiel himself founded the data company Palantir in 2003, which also focused on counter-terrorism and anti-fraud as its early application scenarios, quickly growing into one of the important data infrastructure providers for the U.S. government and large institutions. Palantir's stock price has also increased twenty-fold in the past five years, earning it the title of a truly deserving national fortune stock.

After achieving tremendous financial success with Facebook, Founders Fund has shifted its focus to hard technology, aiming to support startups with the potential to "elevate civilization to a new height." In addition to Facebook, Thiel has made early investments in numerous leading companies across various fields through personal investments or Founders Fund, including Airbnb, LinkedIn, SpaceX, Stripe, and DeepMind.

It is worth mentioning that Thiel also operated an investment management and hedge fund called Clarium Capital in 2002, which advocated a global macro strategy. The assets under its management soared to $8 billion in 2008, but a series of unprofitable investments and client redemptions led to its managed assets shrinking to approximately $350 million in 2011.

From the founding and sale of PayPal, to Facebook's "legendary early investment", and to the formation of Founders Fund and Palantir, Thiel essentially completed the role transformation from "entrepreneur - angel - venture capital partner - industry opinion leader" in the first decade of the 21st century. This process brought him considerable capital strength, networking resources, and the ability to always stay at the forefront of technology, while quietly building a bridge for his entry into the crypto world in the near future.

made 1.8 billion dollars in the cryptocurrency cycle.

Among the many Silicon Valley investors, Thiel is one of the earliest well-known investors to intersect with the cryptocurrency and blockchain industry.

In September 2014, Thiel announced the latest list of winners for the "Thiel Fellowship," with 20 young individuals making the cut, including 20-year-old Ethereum co-founder Vitalik Buterin. This fellowship is a two-year entrepreneurship funding program launched by Thiel through the Thiel Foundation in 2010, aimed at encouraging young people aged 22 and under who do not yet have a college degree to "drop out to start a business or conduct research." In addition to cash funding, the program also provides mentorship and network support without taking equity in the founders' companies. As Ethereum rapidly developed, Vitalik quickly became a representative figure of the Thiel Fellowship.

Before funding Vitalik, Thiel had already shown interest and support for the early blockchain industry. In 2013, Founders Fund led a $2 million seed round investment in the cryptocurrency payment company BitPay. At that time, cryptocurrency payments were still in their infancy, and it was interpreted by outsiders as top Silicon Valley funds beginning to experiment with "payment-side" crypto applications, betting on the prospects of compliance and merchant acceptance.

Another well-known investment by Peter Thiel in the cryptocurrency industry is Block.one and Bullish, with the former being the parent company of the public chain project EOS, and the latter being the cryptocurrency exchange launched by Block.one in 2021. In 2018, Block.one announced that it had received strategic investments from investors including Peter Thiel and Bitmain. In 2021, Block.one also led the incubation of the institutional crypto trading platform Bullish, claiming an investment scale of approximately $10 billion, with Peter Thiel, Alan Howard, and Louis Bacon among the early key supporters.

In 2019, the mining infrastructure company Layer1 announced that it had secured $50 million in funding, with Peter Thiel as one of the investors. Layer1 aims to build a comprehensive capability in the U.S. from power, chips to self-built mining farms, which aligns with Thiel's consistent investment preference for "infrastructure and upstream control."

In addition to supporting early crypto projects as an investor, Thiel's returns from direct investments in cryptocurrencies may be even more astonishing. According to Reuters, as one of the earliest institutional investors in cryptocurrencies, Founders Fund began aggressively purchasing Bitcoin back in 2014 and liquidated its holdings before the cryptocurrency market crash in 2022, yielding approximately $1.8 billion in massive returns.

In addition, sources said that Founders Fund resumed buying cryptocurrencies in the summer of 2023, investing $200 million to purchase BTC and ETH over a few months. Reuters could not ascertain the average price of these purchases, but at the time, the price of BTC was below $30,000, while ETH fluctuated between $1,500 and $1,900. Reuters remarked, "The fondness for cryptocurrencies aligns with billionaire Thiel's interest in libertarianism, small government, and technological innovation."

Increase investment in cryptocurrency

In recent years, Thiel has repeatedly stood up for Bitcoin. In public, he has praised Bitcoin's function as "digital gold" multiple times, calling it a hedge against inflation and central bank policies. In October 2021, at an event hosted by Lincoln Network in Miami, Thiel was invited to share his views on cryptocurrency, central banks, and macro issues, expressing that he felt he was underinvested in Bitcoin and stating, "All you have to do is buy Bitcoin."

It turns out that what Thiel said was not false. In recent years, Thiel seems to have started increasing his investment in cryptocurrencies, and both the investment strategy and focus areas of his Founders Fund have begun to shift towards the crypto space.

In May 2023, former Pantera co-CIO Joey Krug ( joined Founders Fund as a partner. Krug stated on X platform: "I will focus on developing the crypto strategy for Founders Fund over the next decade while seeking the next wave of crypto startups and founders worth supporting." With Krug's joining, Founders Fund is beginning to shift towards treating crypto as a conventional investment category.

In the wave of publicly listed companies embracing crypto treasuries, Tilray once again became the "behind-the-scenes winner." In mid-2025, Bitcoin mining company Bitmine Immersion Technologies announced a strategic shift of its "corporate treasury" towards Ethereum (ETH), appointing Fundstrat co-founder and prominent macro analyst Tom Lee as chairman, and launching a $250 million private placement. In mid-July, as one of the company's most important shareholders, Tilray disclosed that he held approximately 9.1% of the shares. Following the announcement, the company's stock price rose nearly 15% in early trading.

According to data from Strategicethreserve, the Ethereum holdings of the US-listed company Bitmine have reached approximately 1.2 million coins, with a market value exceeding $5 billion, ranking first among Ethereum treasury companies and significantly ahead of the second-ranked Sharplink Gaming, which holds approximately 728,800 coins worth about $3.25 billion.

In addition, Til's early layout from four years ago has also begun to yield returns. In August 2025, Bullish went public on the New York Stock Exchange and saw a significant increase on its first day, marking the official transition of Til's long-term bet on "institutional trading infrastructure" into the public capital market.

) Power broker, Thiel's political influence layout

In addition to achieving commercial success in the fintech and cryptocurrency sectors, Peter Thiel's influence has also reached the power center of Washington. As a "super capitalist of the tech industry," Thiel's role in American politics can no longer be ignored. He has long established his influence in the White House and Congress by funding candidates and building political and business connections.

As one of the few Republican supporters in Silicon Valley, he publicly backed Trump during the 2016 presidential election. In an environment where nearly everyone in Silicon Valley opposed Trump, Thiel's vocal support was indeed an anomaly, but he, as a "self-described libertarian who believes in capitalism," also valued Trump's anti-establishment qualities.

In terms of political donations and networking, Thiel is also very active. In 2016, as an important ally of Trump, Thiel donated $1.25 million to Trump's campaign team and became a member of the presidential transition team.

In addition, the Los Angeles Times pointed out that he has long invested in Republican candidates, especially a new generation of conservative politicians associated with the tech industry. For example, he donated a record $15 million to his protégé—former employee and current U.S. Vice President JD Vance—making it the highest single donation in Ohio Senate campaign history. He also introduced Vance to Trump, helping Vance secure Trump's endorsement, which also indirectly helped Trump find a "golden partner" for his later presidential campaign and second term.

Another Silicon Valley newcomer, Blake Masters, who previously served as the COO of the Thiel Foundation and is a co-author of Thiel's book "Zero to One", has also received funding and support from Thiel, collaborating on a political path. Thiel has invested over $10 million in the super PAC supporting their campaigns.

Multiple major media outlets in the United States have described Thiel as a "power broker" or "big donor" in the Republican tech community. Business Insider even referred to him as the "kingmaker" of the Republican Party, being an early supporter of Trump and the first Silicon Valley tech investor to fulfill his donations in 2016.

It is worth mentioning that Thiel's attitude towards the Trump camp has changed. In a 2023 report by The Guardian, Thiel stated in an interview with The Atlantic that his "support for Trump's decisions is like an 'incoherent cry for help,' and the developments are much crazier and more dangerous than imagined." The report also noted that Trump was very unhappy after being refused when he called Thiel to raise $10 million earlier in 2023. Ultimately, Thiel did not participate in funding the 2024 political campaign.