ZeroStack Flags Going-Concern Doubt After 0G Holdings Lose 91% of Their Cost Basis
The Nasdaq-listed firm, once a cannabis company, now leans on staking rewards to survive — and its latest SEC filing says that plan might not be enough.
By Jane Doe
Published on Aug 3, 2026
Cryptorah
- ZeroStack's Form 10-Q (filed Friday, period ending June 30) reversed its prior "we're fine" assessment and now says there's substantial doubt it can keep operating for another year.
- The company posted an $82.5 million fair value loss on digital assets and a $61.3 million net loss for the first half of 2026.
- Its 75.1 million 0G (Zero Gravity) tokens cost $163.3 million to acquire but were worth just $15.2 million as of June 30 — a 91% markdown.
- With only $2.6 million in cash and negative working capital of $600,000, ZeroStack is depending on staking rewards and token sales to fund operations.
What Happened
ZeroStack, a Nasdaq-listed company built around holding and staking the 0G (Zero Gravity) token, told the SEC on Friday that it now has substantial doubt about its ability to continue as a going concern over the next 12 months. That's a reversal — in each of its previous two quarterly filings, including the first-quarter report, the company had said its cash and staking rewards would be sufficient to cover its obligations for at least a year.
The shift shows up starkly in the balance sheet. As of June 30, ZeroStack held just $2.6 million in cash, had negative working capital of $600,000, and carried an accumulated deficit of $339.1 million. For the first half of 2026, the company recorded a net loss of $61.3 million, driven in large part by an $82.5 million fair value loss on its digital asset holdings.
That loss traces directly to the collapse in value of ZeroStack's core holding: 75.1 million 0G tokens that cost the company $163.3 million to acquire, but which were worth only $15.2 million by the June 30 measurement date — a decline of roughly 91% below cost.
Background: How ZeroStack got here
ZeroStack wasn't always a crypto company. It was previously Flora Growth, a cannabis and CBD products firm. On September 19, Flora announced $401 million in funding to pursue a 0G treasury strategy — made up of $35 million in cash and equivalent commitments plus more than $366 million in in-kind digital assets. The company then rebranded as ZeroStack while keeping its existing Nasdaq listing.
Why It Matters
Why It Matters
ZeroStack is a case study in the risk baked into the "digital asset treasury" model: a public company's balance sheet becomes directly exposed to a single token's price. Because ZeroStack relies on staking rewards and token sales to fund its day-to-day operations, its ability to raise cash is tied to 0G's price and how liquid the market for it is. When the token's value fell sharply, the company's operating runway shrank right along with it — turning what was framed as a treasury strategy into a solvency question.
The Numbers
Bars scaled proportionally to dollar value. Source: ZeroStack Form 10-Q.
Source: ZeroStack Form 10-Q, first half of 2026.
Methodology / sourcing notes for these figures
All figures above come directly from ZeroStack's Form 10-Q filed with the SEC on Friday, covering the period ended June 30. Token counts and dollar values reflect the company's own reported cost basis and fair-value measurements as of that date; no third-party price feed or market data was used to adjust or verify these figures.
Market Reaction
What's Next / Things to Watch
ZeroStack said it expects its existing cash plus proceeds from selling staking rewards to cover its forecast operating costs, and management noted it could sell some of its treasury holdings if needed. However, the company explicitly said it could not conclude that these plans would be sufficient to resolve the doubt about its ability to continue operating — meaning the going-concern flag remains open rather than resolved.
Because the company's runway is tied to 0G's price and how easily it can be sold, the token's liquidity and valuation going forward are the key variables to watch. The filing does not specify a timeline for resolving the going-concern issue beyond the standard 12-month look-ahead required in such disclosures.
FAQs
What is ZeroStack?
ZeroStack is a Nasdaq-listed company that holds and stakes the 0G (Zero Gravity) token as its core treasury strategy. It was previously known as Flora Growth, a cannabis and CBD products company, before rebranding after announcing its 0G treasury plan.
Why did ZeroStack warn about its ability to continue operating?
The company reported an $82.5 million fair value loss on its digital assets and a $61.3 million net loss for the first half of 2026, leaving it with just $2.6 million in cash and negative working capital of $600,000 as of June 30.
How much have ZeroStack's 0G holdings lost in value?
Its 75.1 million 0G tokens cost $163.3 million to acquire but were worth only $15.2 million as of June 30 — a decline of about 91% from cost.
How does ZeroStack plan to fund its operations?
The company relies primarily on staking rewards and token sales. In the first half of 2026 it earned $3.8 million in staking revenue (about 6.6 million 0G tokens after validator commissions) and sold roughly 4.9 million tokens for $2.4 million to cover operating expenses.
Was ZeroStack always a crypto company?
No. It was previously Flora Growth, a cannabis and CBD products firm, before announcing a $401 million funding package for a 0G treasury strategy and rebranding as ZeroStack while keeping its Nasdaq listing.
Endnotes
- Source article: "Crypto treasury firm ZeroStack warns of survival risk amid $82.5M loss" — Cointelegraph. ⚠️ No direct URL was provided in the source content for this article itself.
- Related, referenced but not linked in the source: "BitMart withdrawals appear to slow following wind-down announcement" (Cointelegraph). ⚠️ No URL provided.
- Related, referenced but not linked in the source: "The real reason DeFi projects that survived 2022 crash are shutting down now" (Cointelegraph Magazine). ⚠️ No URL provided.
