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Crypto treasury firm ZeroStack warns of survival risk amid $82.5M loss
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- DeepHorus
Nasdaq-listed crypto treasury firm ZeroStack has warned that substantial doubt exists about its ability to continue operating over the next year, reversing its assessment from three months earlier. The company, which holds a large position in Zero Gravity (0G) tokens, disclosed the warning in a Form 10-Q filed with the U.S. Securities and Exchange Commission on Friday. ZeroStack also reported an $82.5 million fair value loss on digital assets and a net loss of $61.3 million for the first half of 2026.
ZeroStack, formerly the cannabis and CBD products firm Flora Growth, rebranded after announcing a $401 million funding commitment for a 0G treasury strategy in September. The company now relies heavily on staking rewards and token sales to fund its operations. Its latest filing shows $2.6 million in cash, negative working capital of $600,000, and an accumulated deficit of $339.1 million as of June 30.
The company's 0G holdings have deteriorated sharply in value. ZeroStack said its 75.1 million 0G tokens had an aggregate cost of $163.3 million but a fair value of just $15.2 million, leaving the holdings valued about 91% below their recorded costs. This decline has strained the company's liquidity position, forcing it to sell tokens to cover expenses.
During the first half of the year, ZeroStack generated $3.8 million in staking revenue, earning approximately 6.6 million 0G tokens after validator commissions. It sold nearly 4.9 million tokens for $2.4 million to fund operations. The company said it expects cash and staking reward sales to cover forecast operating costs, and it could sell additional treasury holdings if needed.
However, management stated it could not conclude that those plans would be sufficient to ease doubts about the company's ability to continue as a going concern. This assessment marks a sharp reversal from the company's first-quarter filing, which said cash and staking rewards would cover working capital requirements for at least another year.
The warning underscores the risks of cryptocurrency treasury strategies, particularly those concentrated in a single token. ZeroStack's future depends on 0G's price and trading liquidity, which have proven volatile. The company's fate remains uncertain as it navigates a challenging market and depleted cash reserves.
