Crypto treasury firm ZeroStack warns of survival risk amid $82.5M loss

cointelegraphPublished on 2026-08-03Last updated on 2026-08-03

Abstract

Nasdaq-listed crypto treasury firm ZeroStack has warned there is "substantial doubt" about its ability to continue operating over the next year, reversing its assessment from just three months prior. The company 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. As of June 30, it held $2.6 million in cash, had negative working capital, and an accumulated deficit of $339.1 million. A key issue is the drastic devaluation of its 75.1 million Zero Gravity (0G) tokens, which had a fair value of only $15.2 million against a recorded cost of $163.3 million—a 91% decline. ZeroStack relies on staking rewards and token sales to fund operations, making its liquidity heavily dependent on the price and trading liquidity of 0G. While it earned $3.8 million in staking revenue and sold tokens for $2.4 million in the first half of the year, management stated it cannot conclude these plans will be enough to ensure survival. The company, formerly cannabis firm Flora Growth, rebranded after announcing a $401 million 0G treasury strategy in September. Its latest filing marks a stark reversal from its previous quarter's assertion that its resources were sufficient for at least another year.

Nasdaq-listed crypto treasury company ZeroStack warned that substantial doubt exists about its ability to continue operating over the next year, reversing its assessment from three months earlier.

In a Form 10-Q filed with the US Securities and Exchange Commission (SEC) on Friday, ZeroStack reported $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 also posted 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 said its 75.1 million Zero Gravity (0G) tokens had an aggregate cost of $163.3 million and a fair value of $15.2 million as of June 30, leaving the holdings valued about 91% below their recorded costs.

ZeroStack relies on staking rewards and token sales to fund operations, making its ability to raise cash dependent on 0G’s price and trading liquidity.

ZeroStack’s 0G strategy faces a liquidity test

ZeroStack reported $3.8 million in staking revenue during the first half of the year, earning about 6.6 million 0G tokens after validator commissions. It sold nearly 4.9 million tokens for $2.4 million to fund its operating expenses.

The company expects its cash and staking reward sales to cover forecast operating costs and said it could sell some of its treasury holdings if needed. However, management said it could not conclude that those plans would be enough to ease doubts about its ability to continue operating.

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The latest assessment reverses the company’s position in its previous two reports. In its first-quarter filing, ZeroStack said its cash and staking rewards would be sufficient to meet its working capital requirements and obligations for at least another year.

The company was previously the cannabis and CBD products firm Flora Growth. On Sept. 19, Flora announced $401 million in funding for a 0G treasury strategy, including $35 million in cash and equivalent commitments and more than $366 million in in-kind digital assets. The company subsequently rebranded as ZeroStack and retained its Nasdaq listing.

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