ZeroStack, formerly Flora Growth, warned it may not survive the next year after its 0G token holdings lost 91% of recorded value, leaving $2.6M cash against a $339M deficit.
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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 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.
The warning centers on ZeroStack's 75.1 million Zero Gravity (0G) tokens. Those holdings had an aggregate cost of $163.3 million and a fair value of $15.2 million as of June 30, leaving the tokens 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. The company 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.
Management said it expects cash and staking reward sales to cover forecast operating costs and could sell some of its treasury holdings if needed. It could not conclude those plans would be enough to ease doubts about its ability to continue operating, the filing said.
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.
ZeroStack 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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