Thiel is a smart investor but even smart investors lose money on some investments. "backed" can have many meanings. I would imagine he has some kind of stop-loss on his exposure to risk here. And indeed, its "Valar Ventures" which has invested, an indirect vehicle.

Note: I dislike the guys politics, but that has nothing to do with an objective assessment of his financial investment chops. Same with Andreessen, he doesn't figure in my 'friends of carlotta' list but he obviously knows a good investment when he sees one.

My personal belief is that Thiel is too smart to have believed any of the bullshit about coins and NFT, and was in this as risk play for the upside. I am sure he made heaps doing this elsewhere in the crypto bubble, he can wear this (small, in his terms) downside outcome.