Update (Sept. 22, 7:12 am UTC): This story has been updated to add background on Flora Growth’s cannabis operations.
Flora Growth, a Nasdaq-listed cannabis and CBD consumer-products company, has launched a $401 million treasury initiative to back Zero Gravity, a blockchain project aimed at decentralized AI infrastructure.
The move comes through a private placement deal combining $35 million in cash with $366 million in in-kind digital assets, primarily denominated in Zero Gravity (0G) tokens. As part of the transaction, Flora will rebrand as ZeroStack while retaining its Nasdaq ticker, FLGC, according to a Friday announcement.
Flora built its business growing cannabis in Colombia and selling branded products, including through its JustCBD line, which it acquired in 2022 to expand its US footprint. The company has also pursued cultivation and distribution in Europe, including Germany, as cannabis rules have loosened in that market.
The company’s recent strategy has mixed its legacy cannabis operations with capital markets initiatives, rather than abandoning cannabis entirely.
Solana (SOL) treasury company DeFi Development Corp. (DFDV) led the deal, alongside Hexstone Capital and Carlsberg SE Asia, with participation from firms including Dao5, Abstract Ventures and Dispersion Capital.
“We’re thrilled to partner with FLGC on this fundraise and look forward to driving a deep collaboration between 0g and Solana,” said DFDV CEO Joseph Onorati. Flora will also hold a portion of its treasury in SOL tokens.
Related: Crypto treasuries with long-term strategy will ‘survive any market’: Hashkey
Zero Gravity trains 107 billion-parameter AI model
The investment aims to scale 0G’s AI infrastructure, which can already train a 107 billion parameter model using distributed clusters, a feat that surpasses previous benchmarks from tech giants like Google. 0G claims a 357x efficiency improvement over existing distributed AI frameworks.
Incoming CEO Daniel Reis-Faria described the treasury move as a way for institutional investors to gain equity-based exposure to a “transparent, verifiable, and privacy-first AI infrastructure.”
Closing is expected by Sept. 26, pending shareholder approval. Certain investors will receive pre-funded warrants tied to the use of 0G tokens in the offering.
Related: Bitcoin as corporate treasury: Why Meta, Amazon and Microsoft all said no
Standard Chartered warns of DAT shakeout as mNAVs collapse
Digital asset treasury (DAT) firms are facing mounting pressure as market net asset values (mNAVs) across the sector have sharply declined, Standard Chartered said Monday. Once boosted by the success of Strategy’s Bitcoin accumulation model, the DAT boom has stalled, exposing smaller players to growing risks as their valuations sink.
An mNAV above 1 typically enables firms to issue new shares and expand crypto holdings. However, with many DATs now trading below that threshold, access to low-cost capital has dried up, stalling further accumulation and growth.
The bank expects sector-wide consolidation, with larger, better-funded players like Strategy and Bitmine emerging as likely winners. Smaller firms struggling with suppressed mNAVs may become acquisition targets.
Magazine: Meet the Ethereum and Polkadot co-founder who wasn’t in Time Magazine