Nasdaq-listed crypto treasury firm ZeroStack has told the market that “substantial doubt” exists about whether it can keep operating over the next year, according to a recent SEC filing. The warning marks a notable shift from the company’s earlier assessment, where it said its liquidity position was expected to support operations for at least another year.
In a Form 10-Q filed with the US Securities and Exchange Commission on Friday, ZeroStack reported $2.6 million in cash as of June 30, negative working capital of about $600,000, and an accumulated deficit of $339.1 million. The company also recorded an $82.5 million fair value loss on digital assets and posted a net loss of $61.3 million for the first half of 2026. (Source: SEC Form 10-Q)
Key takeaways
- ZeroStack’s filing introduces “substantial doubt” over its ability to continue operating, reversing an earlier liquidity outlook.
- As of June 30, the firm reported $2.6 million cash and negative working capital of roughly $600,000.
- 0G token holdings were valued at about $15.2 million versus an aggregate cost of $163.3 million—an indicated ~91% decline relative to recorded cost.
- The business model depends on staking rewards and token sales, leaving funding levels tied to 0G price and market liquidity.
- In the first half of 2026, ZeroStack generated $3.8 million from staking revenue and sold nearly 4.9 million tokens for $2.4 million.
What the SEC filing says about liquidity
The company’s latest Form 10-Q provides a snapshot of a treasury-led model facing tightening economics. ZeroStack disclosed $2.6 million in cash at the end of the first half of 2026 and negative working capital of approximately $600,000. It also reported an accumulated deficit of $339.1 million.
Beyond headline balance sheet metrics, the filing points to major valuation pressure on the company’s digital asset exposure. ZeroStack stated it recorded an $82.5 million fair value loss on digital assets during the period covered by the report. It also posted a net loss of $61.3 million for the first half of 2026. (Source: SEC Form 10-Q)
The company’s token treasury is central to the funding story. ZeroStack holds 75.1 million Zero Gravity (0G) tokens, with an aggregate recorded cost of $163.3 million and a fair value of $15.2 million as of June 30. That puts the holdings at roughly 91% below their recorded costs based on the fair value disclosed. (Source: SEC Form 10-Q)
Staking revenue and token sales: the funding hinge
ZeroStack said it relies on staking rewards and token sales to support operations. That structure creates a direct link between the company’s runway and two market variables: the price of 0G and the ability to sell tokens with sufficient liquidity.
In the first half of 2026, ZeroStack reported $3.8 million in staking revenue. The company also stated it earned about 6.6 million 0G tokens after validator commissions. During the same period, ZeroStack sold nearly 4.9 million tokens for $2.4 million to help cover operating expenses. (Source: SEC Form 10-Q)
Management said it expects cash on hand and staking reward sales to cover forecast operating costs. The filing also indicates the company could sell part of its treasury holdings if additional funds are needed. However, the key line for investors is that management could not conclude those plans would be enough to eliminate the “substantial doubt” about its ability to continue operating. (Source: SEC Form 10-Q)
Reversal from earlier liquidity guidance
The new warning is not the company’s first liquidity assessment this year. ZeroStack’s latest stance reverses what it told investors in its previous reports.
In its first-quarter Form 10-Q, ZeroStack said it expected its cash and staking rewards to be sufficient to meet working capital requirements and obligations for at least another year. (Source: SEC Form 10-Q (Q1))
In the latest filing, the company’s conclusion becomes more cautious. While ZeroStack points to operational funding coming from staking and potential token sales, the company’s inability to rule out a going-concern risk suggests the funding mix—when measured against current balance sheet realities and valuation losses—may be less reliable than earlier estimates.
Context: 0G treasury strategy and the cost-to-fair-value gap
ZeroStack’s current identity is tied to a broader pivot into 0G-centered treasury operations. The company was previously known as Flora Growth, a cannabis and CBD products firm. On Sept. 19, Flora announced a $401 million funding plan for a 0G treasury strategy. That plan included $35 million in cash and commitments, alongside more than $366 million in in-kind digital assets. The company later rebranded as ZeroStack while keeping its Nasdaq listing. (Source: Earlier coverage on Flora Growth’s 0G treasury announcement)
From an investor perspective, the most striking element in the latest report is the gap between the recorded cost of 0G holdings and their disclosed fair value. As of June 30, the tokens were booked at an aggregate cost of $163.3 million but marked at $15.2 million in fair value, implying the portfolio’s valuation has compressed sharply relative to its initial recorded basis. That gap matters because it directly affects how much capital the treasury can generate if token sales are needed to fund operating requirements—especially if liquidity is uneven or prices remain pressured. (Source: SEC Form 10-Q)
ZeroStack’s report therefore reads less like a one-off accounting update and more like an operational stress test of a staking-and-sales model. When the fair value of the underlying treasury declines so dramatically, even steady staking inflows may not translate into enough liquidity to cover burn and obligations without meaningful downside risk from continued token sales.
Going forward, investors should watch for whether ZeroStack can stabilize cash levels through staking reward performance and token sale capacity, and whether future filings confirm that the going-concern doubt diminishes or expands—an outcome that will likely depend on 0G liquidity and price rather than on the company’s ability to generate rewards alone. (Source: SEC Form 10-Q)
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