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Cosmos Health faces going concern risk after crypto treasury drops 46%
The Nasdaq-listed firm said its combined ETH and BTC holdings were $1.66 million versus a $3.1 million cost basis as of June 30, while its share count nearly tripled to about 100.6 million by Aug. 18.
Cosmos Health warned it may not survive the next 12 months, citing recurring losses and reliance on outside financing as its crypto treasury declined. CryptoSlate reports the company’s holdings fell about 46% by the end of June, raising “substantial doubt” about its ability to continue as a going concern.
As of June 30, Cosmos Health held 474.85 ETH and 15.66 BTC, valued at a combined $1.66 million against a $3.1 million cost basis, for about $1.44 million in unrealized losses. Ethereum accounted for $1.25 million, or 87%, of that shortfall.
The losses trace to an August 2025 financing agreement with ATW Digital Asset Opportunities VII, under which Cosmos could issue up to $300 million of senior secured convertible notes. Under the agreement, Cosmos was required to direct 72.5% of net note proceeds into crypto, with the remainder for working capital and general corporate purposes, and the assets were subject to collateral and custody arrangements tied to the financing.
Cosmos Health’s underlying cash burn also remains a key driver of the going concern warning. In the first half, it reported an $8.89 million net loss and used $2.79 million in operating cash, ending June with $1.80 million of unrestricted cash, and said revenue was insufficient to cover operating expenses and meet debt obligations as they came due. The company issued 22.9 million shares during the first half via conversions of the note, and after the quarter it issued another 20.48 million shares, bringing its shares to roughly 100.6 million by Aug. 18.
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