ZeroStack’s plan to fund operations through 0G token reward sales is in jeopardy after a sharp drop in the token’s value. The downturn has also cast doubt on the company’s ability to continue as a going concern.
ZeroStack ended June with a $61.3 million first-half loss, negative working capital, and $2.6 million in cash.
ZeroStack’s Form 10-Q Disclosure
According to its Form 10-Q disclosure for the quarter ending June 30, ZeroStack held $2.6 million in cash, negative working capital of $600,000, an accumulated deficit of $339.1 million, and a $61.3 million net loss. The company also reported an accounting loss of $82.5 million after re-measuring its assets at fair value.
ZeroStack held 75.1 million 0G tokens with a fair value of $15.17 million and a recorded cost of $163.33 million. It also held a small Bitcoin (BTC) position, taking the total fair value of ZeroStack’s holdings to $15.21 million and the total recorded value to $163.43 million.
The downturn in the value of ZeroStack’s 0G tokens represents a 90% decline and has cast serious doubts on the company’s financial stability and its ability to continue operations without securing additional funding.
Staking Reward Sales To Fund Operations
ZeroStack received 6.62 million 0G tokens through staking rewards in the first half of 2026, earning $3.78 million in revenue. The company sold 4.94 million 0G tokens for $2.4 million and used $2.47 million in cash for other operational activities. The company plans to monetize staking rewards and fund operations.
It may also sell some of its underlying holdings. ZeroStack stated in its disclosure that the staked tokens are held in company wallets and can be withdrawn when needed. The company also noted that staking rewards could decline or disappear entirely, and that any sale depended on prevailing market conditions and token value.
However, ZeroStack’s strategy could be at risk due to the significant decline in the 0G token’s value. The token is currently trading at $0.14, declining nearly 5% in the past 24 hours.
Investor Confidence Shaken
ZeroStack’s 0G bet and the subsequent decline in the token’s value significantly impact its investors. The downturn could result in further write-downs, affecting stock price and investor confidence.
Investors will closely monitor ZeroStack’s next steps. The company can raise funds through asset sales, a capital raise, or restructuring efforts. However, its current model could fail if the 0G token’s value continues declining.
ZeroStack’s July 20 acquisition of Texas Blocker increased its 0G token holding to 223.77 million, amplifying its exposure to the token’s downturn.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
