[Digital Today reporter Chi-gyu Hwang] Zerostack, a Nasdaq-listed company running a digital asset treasury business, warned there is material uncertainty about its ability to continue as a going concern over the next year. Cointelegraph reported on Aug. 3 (local time) that Zerostack made the disclosure in a 10-Q report filed with the U.S. Securities and Exchange Commission, reversing an assessment made three months earlier.

As of June 30, Zerostack reported $2.6 million in cash, a $0.6 million working-capital deficit and accumulated losses of $339.1 million. In the first half of this year, it posted a $82.5 million fair value loss on digital assets and a net loss of $61.3 million.

The main burden is valuation losses on 0G tokens. Zerostack’s acquisition cost for 75.1 million Zero Gravity 0G tokens it holds totaled $163.3 million, but their fair value stood at $15.2 million as of June 30. That is about 91 percent below the book acquisition cost.

Zerostack raises operating funds mainly through staking rewards and token sales. As a result, its ability to secure cash depends on the 0G price and trading liquidity. The company recorded $3.8 million in staking revenue in the first half and received about 6.6 million 0G tokens after validator fees. It also sold about 4.9 million tokens for $2.4 million to cover operating expenses.

Zerostack said it can cover expected operating expenses with its cash on hand and sales of staking rewards, and can also sell additional portions of its treasury holdings if needed. Management, however, did not conclude that these plans alone are sufficient to resolve the uncertainty over its ability to continue as a going concern.