10-K: Greenlane Pivots to BERA Digital Asset Strategy Amid Losses

Greenlane Holdings, Inc. has undergone a significant strategic shift to a BERA-focused digital asset treasury model, reporting substantial net losses and facing a Nasdaq delisting notice.

Summary

• Greenlane Holdings, Inc. has transitioned its primary strategic focus from a traditional wholesale and distribution business to a digital asset treasury strategy centered on BERA, the native token of the Berachain blockchain network, effective October 2025.
• The company reported a net loss of $85.6 million for the year ended December 31, 2025, a significant increase from $17.7 million in 2024.
• Net revenue decreased by 67% to $4.4 million in 2025 from $13.3 million in 2024, primarily due to the reduction of legacy operations and sales team reorganization.
• Operating expenses surged to $41.8 million in 2025 from $18.1 million in 2024, largely driven by $18.6 million in stock-based compensation for strategic advisory warrants and $6.3 million in inventory impairment write-downs.
• The company recorded $31.1 million in unrealized losses on digital assets in 2025 due to market fluctuations in BERA.
• As of December 31, 2025, Greenlane held approximately $32.5 million in cash and cash equivalents and $36.6 million in digital assets (BERA).
• A $110.7 million private placement in October 2025 provided capital for the digital asset strategy, consisting of cash, stablecoins, and BERA tokens.
• Greenlane received a Nasdaq delisting notice on March 25, 2026, due to non-compliance with minimum bid price requirements and previous reverse stock splits, and plans to appeal this determination.
• The company implemented a 1-for-750 reverse stock split on June 26, 2025, and stockholders approved another reverse stock split (1-for-5 to 1-for-15) on March 25, 2026, to be effected shortly after the filing date.
• Material weaknesses in internal control over financial reporting were identified as of December 31, 2025, particularly concerning IT access controls, digital asset treasury controls, and the overall control environment.

Sentiment

Score: 2

Explanation: StockSavvy.ai views this filing with a very negative sentiment due to the substantial net losses, significant revenue decline in the legacy business, large unrealized losses on digital assets, and the critical Nasdaq delisting notice, all of which overshadow the capital raised for the high-risk digital asset strategy.

Positives

• The company successfully raised approximately $110.7 million through a private placement in October 2025, providing significant capital for its new digital asset treasury strategy.
• Cash and cash equivalents increased substantially to $32.5 million as of December 31, 2025, from $0.9 million in 2024, improving liquidity.
• The company has no outstanding debt as of December 31, 2025, following full repayment in February 2025.
• Management believes there is no substantial doubt about the company's ability to continue as a going concern for at least the next twelve months, based on current liquidity and plans.
• The transition to an asset-light, drop-ship model for the legacy wholesale business is expected to reduce operating costs and eliminate working capital requirements associated with inventory.

Negatives

• Net loss significantly widened to $85.6 million in 2025 from $17.7 million in 2024, primarily due to unrealized losses on digital assets and increased operating expenses.
• Net revenue from legacy operations decreased by 67% to $4.4 million in 2025, indicating a substantial decline in the traditional business.
• The company recorded $31.1 million in unrealized losses on digital assets in 2025, highlighting the high volatility and risk of its BERA holdings.
• A $6.3 million inventory impairment write-down was recorded in 2025, reflecting reduced demand and the exit from warehouse operations.
• Operating expenses increased by 134% to $41.8 million in 2025, partly due to $18.6 million in non-cash stock-based compensation for strategic advisory warrants.
• The company received a Nasdaq delisting notice on March 25, 2026, and is not eligible for a compliance period due to prior reverse stock splits, posing a significant threat to its public listing.
• Material weaknesses in internal control over financial reporting were identified as of December 31, 2025, indicating deficiencies in IT access controls, digital asset treasury controls, and the overall control environment.
• The company has experienced significant management turnover in recent years, which can create uncertainty and impact execution.
• The market value of common equity held by non-affiliates was approximately $1.0 million as of June 30, 2025, indicating a very small public float.

Risks

• Inability to successfully implement the new BERA-focused digital asset treasury strategy, which requires specialized skillsets and exposes the company to significant operational risks.
• Extreme volatility and unpredictable changes in the price of BERA and other digital assets, which could materially adversely affect financial results and the market price of common stock.
• Potential classification of BERA tokens as a security under U.S. federal securities laws, leading to additional regulation, impact on treasury strategy, and potential reclassification as an investment company under the 1940 Act.
• Risks related to the custody of BERA or other digital assets, including loss or destruction of private keys, cyberattacks, or other data loss.
• Technical shortcomings or defects in the BERA network, including changes to its validator structure, governance model, or core software, could diminish the utility and value of BERA.
• The economic design underlying Berachain's Proof of Liquidity (PoL) consensus mechanism may be flawed, fail to gain adoption, or be exploited, undermining network growth.
• Losses due to staking or validator slashing on the Berachain network, making it less attractive and potentially decreasing BERA's price.
• Compromise of Berachain's network security by emerging technologies like artificial intelligence and quantum computing.
• Disruption of the internet or the Berachain network, negatively impacting BERA's value and the company's operations.
• Engagement in derivatives transactions (call/put options on BERA) exposes the company to material risks, including counterparty default, illiquidity, and valuation challenges.
• BERA holdings are less liquid than cash and cash equivalents, and may not serve as a reliable source of liquidity, especially during market instability.
• Regulatory developments related to digital assets and digital asset markets could adversely affect the business, financial condition, and results of operations, including increased compliance costs or operational shutdowns.
• Litigation, regulatory enforcement actions, or legal proceedings against key participants in the Berachain ecosystem could harm network activity and token demand.
• Berachain's base layer infrastructure may be used for unregulated applications or those facing significant regulatory risks, potentially impacting BERA demand.
• Additional sales, distributions, or issuances of BERA could cause its price to decline significantly, amplified by the company's large holdings (70.4 million BERA as of February 27, 2026).
• Digital asset trading platforms are relatively new, largely unregulated, and susceptible to market abuse, manipulation, and security breaches.
• The digital asset industry is new and rapidly evolving, and the value of common stock depends on the acceptance of Berachain and its applications.
• Berachain is a relatively new technological innovation with a limited operating history, increasing uncertainty regarding its long-term viability.
• Losses from DeFi protocol failures, hacks, or exploits, as the company intends to deploy BERA into DeFi applications.
• Exposure to sanctioned or blocked persons through blockchain technology, potentially resulting in violations of economic sanctions and anti-money laundering laws.
• BERA holdings are not subject to FDIC or SIPC protections, risking total loss if lost, stolen, or experiencing significant price reduction.
• Global economic conditions, including conflicts, inflation, and supply chain disruptions, could materially and adversely affect the business.
• Inability to raise additional capital on acceptable terms, compromising the ability to implement and sustain the Treasury Policy.
• Failure to meet Nasdaq continued listing requirements, leading to delisting and negative effects on stock price and financing ability.
• Risks related to Nasdaq's proposed rule regarding minimum market value of listed securities, which could lead to immediate suspension and delisting if MVLS falls below $5 million.
• Volatility in the market price of Class A common stock, which has declined significantly since IPO and may continue to do so.
• Dilution of percentage ownership due to future equity awards and securities issuances.
• Substantial sales and issuances of Class A common stock, or the anticipation thereof, could cause the stock price to decline.
• Strain on resources and management distraction due to public company requirements, especially as the company is no longer an emerging growth company.
• Management and employee turnover creates uncertainties and could harm the business.
• Uncertainty related to the regulation of vaporization products and other consumption accessories, potentially increasing compliance burdens.
• Dependence on third-party suppliers for products and potential supply shortages.
• Vulnerability to third-party transportation risks, including governmental laws and common carriers' policies that prevent product shipment.
• Lack of long-term agreements or guaranteed price/delivery arrangements with most suppliers and customers.
• Difficulty collecting receivables, especially if customers experience financial challenges.
• Potential termination or non-renewal of licenses for certain brands and trademarks.
• Inability to maintain consumer brand recognition and loyalty for products.
• Inability to establish sustainable relationships with large retailers or regional/national chains.
• Intense media attention and public pressure on new products, potentially leading to bans or negative perception.
• Dependence on the quality and safety of products, with potential for defects, recalls, and liability claims.
• Damage to reputation from unfavorable media or social media commentary.
• Substantial and increasing regulation regarding the vaporization industry, including federal, state, provincial, and local levels.
• Business dependence on continued purchases by cannabis-related businesses and individuals, subject to evolving and uncertain cannabis laws.
• Difficulty accessing banking services for the company and its customers due to cannabis-related activities.
• Reliance on third-party payment providers and evolving payment laws and regulations.
• Potential for increased sales taxes on vaporizer products, adversely affecting demand.
• Involvement in regulatory or agency proceedings, investigations, prosecutions, and audits.
• Increasing international control and regulation, such as the FCTC and TPD, affecting international operations.
• Changes in credit profile affecting relationships with suppliers and liquidity.
• Risks associated with international operations, including political instability, inconsistent regulations, and foreign currency exchange fluctuations.
• New tariffs and evolving trade policy disputes, particularly between the U.S. and China, affecting costs and demand.
• Failure to comply with environmental, health, and safety regulations.
• Risks related to business transitions, dispositions, and other strategic initiatives.
• Operations subject to natural disasters, adverse weather conditions, operating hazards, environmental incidents, and labor disputes.
• Risks associated with public health crises, such as pandemics and epidemics.
• Conflicts of interest among executive officers and stockholders due to other business activities.
• Dependence on subsidiaries for cash flow, with potential limitations on distributions.
• Obligations under the Tax Receivable Agreement (TRA) to make cash payments for tax benefits.
• Fluctuations in tax obligations and effective tax rate, and realization of deferred tax assets.
• Anti-takeover provisions in corporate documents and Delaware law could discourage takeovers.
• Potential future issuance of preferred stock, which could make acquisition difficult or adversely affect Class A common stock holders.
• Exclusive forum provision in corporate documents limiting stockholders' ability to obtain a favorable judicial forum.

Future Outlook

The company's near-term operating priorities include disciplined execution of its digital asset treasury strategy, preservation of liquidity and capital flexibility, continued reduction and simplification of residual legacy operating activities, and operation of vapor.com through an asset-light drop-ship model. Management believes it has sufficient liquidity for the next twelve months and may seek additional capital opportunistically. The company plans to deploy up to 50 million units of BERA into validator infrastructure on the Berachain network.

Management Comments

• Management believes that the ultimate resolution of legal proceedings will not have a material adverse effect on the company's consolidated financial statements, although outcomes are inherently uncertain.
• Management is committed to remediating the material weaknesses in internal control over financial reporting and has developed a comprehensive remediation plan to be implemented throughout fiscal year 2026.

Industry Context

StockSavvy.ai notes that Greenlane's pivot to a digital asset treasury strategy, particularly with a concentrated focus on BERA, places it squarely within the nascent and highly volatile cryptocurrency industry. This move contrasts sharply with its legacy wholesale and distribution business, which is experiencing significant decline. The shift aligns with a broader trend of companies exploring digital assets for treasury management, but Greenlane's deep dive into a single, less established asset like BERA (compared to Bitcoin or Ethereum) introduces amplified concentration risk. The regulatory landscape for digital assets remains highly uncertain, with ongoing actions from the SEC and other global bodies, which could significantly impact Greenlane's strategy and BERA's valuation. The company's challenges with Nasdaq listing requirements also highlight the difficulties traditional public companies face when integrating highly speculative and unregulated assets into their core business model.

Comparison to Industry Standards

• Greenlane's net loss of $85.6 million in 2025, coupled with a 67% revenue decline in its legacy business, significantly underperforms traditional wholesale/distribution industry standards, which typically aim for profitability and revenue growth.
• The company's concentration of assets in a single, less established digital asset like BERA (51.7 million units valued at $36.6 million as of December 31, 2025) is a high-risk strategy compared to more diversified digital asset treasury approaches seen in larger, more established companies like MicroStrategy, which primarily holds Bitcoin.
• The reported material weaknesses in internal control over financial reporting, particularly concerning digital asset custody and valuation, fall below the robust standards expected of public companies, especially those engaging in complex and novel financial strategies.
• The Nasdaq delisting notice and the need for multiple reverse stock splits indicate a severe struggle to meet basic listing requirements, a situation far below industry benchmarks for publicly traded companies.
• The company's indicative net asset value of $13.04 per share as of December 31, 2025, is heavily influenced by the volatile fair value of BERA, making it a less stable measure compared to NAVs of companies with more traditional, less volatile asset bases.

Management Changes

Corporate Governance

Legal Proceedings

• The company is a defendant in various consumer and direct purchaser class action lawsuits alleging antitrust violations in connection with the distribution of CCELL products, consolidated into a single amended complaint.
• Crossmark, Inc. brought a breach of contract suit against the company's subsidiary, Warehouse Goods, LLC, for $297,182.
• Vaporous Technologies, Inc. brought a suit for liquidated damages of $664,289 under a September 2020 Manufacturing Agreement against Warehouse Goods, LLC.
• The company received a Civil Investigation Demand on February 25, 2025, regarding alleged violations of the False Claims Act concerning a 2020 Federal Payment Protection Program (PPP) loan of approximately $1.9 million for a subsidiary (Kim International LLC).
• The company recorded an accrual of approximately $0.5 million as of December 31, 2025, related to legal matters.

Related Party Transactions

• Benjamin Isenberg, the Chief Investment Officer, is the wholly-owned owner of BSQD Corp., a liquidity provider that the company's counterparty (Berachain Operations Corporation) may transact with to source BERA tokens. Any such transactions would be conducted on an arms-length basis at prevailing market prices and conditions.
• Renah Persofsky, a former director until October 23, 2025, is a Principal Owner of Green Gruff USA Inc. In January 2025, the company entered into an amended distribution agreement with Green Gruff, recognizing $60 thousand of revenue and incurring $28 thousand in cost of goods sold for the year ended December 31, 2025. As of December 31, 2025, $22 thousand was due from Green Gruff.

Stakeholder Impact

• Shareholders face significant dilution risk from past and future equity issuances, including pre-funded and advisory warrants exercisable for over 30 million shares, compared to 5 million shares outstanding as of March 27, 2026.
• Shareholders are exposed to extreme volatility and potential loss of investment due to the high-risk digital asset treasury strategy and the concentration in BERA.
• Shareholders face the risk of delisting from Nasdaq, which would severely impact liquidity and market price of Class A common stock.
• Employees have experienced significant headcount reductions in legacy operations, with the workforce now concentrated in treasury, finance, compliance, technology, and limited e-commerce support functions.
• Customers of the legacy wholesale and distribution business may experience changes in product availability and service as the company transitions to an asset-light, drop-ship model and reduces its footprint.
• Creditors (if any in the future) may face increased risk due to the company's history of net losses and the speculative nature of its primary asset holdings, although currently, there is no outstanding debt.
• Regulatory bodies will maintain increased scrutiny on the company's digital asset activities due to the evolving and uncertain regulatory landscape for cryptocurrencies.

Next Steps

• Appeal the Nasdaq delisting determination before a Nasdaq Hearings Panel.
• Effect the approved reverse stock split (1-for-5 to 1-for-15) shortly after the issuance of these financial statements.
• Implement a comprehensive remediation plan throughout fiscal year 2026 to address material weaknesses in internal control over financial reporting.
• Enhance finance, accounting, and information technology resources, including hiring additional personnel and upgrading the ERP system.
• Strengthen controls over digital asset custody, wallet access authorization, transaction processing, valuation, and reconciliation.
• Continue disciplined execution of the digital asset treasury strategy, including deploying up to 50 million units of BERA into validator infrastructure.
• Monitor laws and regulations related to digital assets to determine any necessary compliance changes.
• Potentially seek additional capital opportunistically depending on market conditions and strategic priorities.
• Continue to pursue claims against Shavita B.V. and the purchaser group regarding the disputed sale of EU subsidiaries.

Key Dates

Recommendation

The company's financial performance is severely distressed, marked by a substantial net loss of $85.6 million in 2025 and a 67% decline in legacy revenue. The pivot to a BERA-focused digital asset strategy introduces extreme volatility and concentration risk, as evidenced by the $31.1 million unrealized loss on digital assets. Critically, the Nasdaq delisting notice, coupled with a history of reverse stock splits and identified material weaknesses in internal controls, signals profound operational and governance challenges. For a seasoned investor, these factors collectively present an exceptionally high-risk profile with significant downside potential and limited clear paths to sustainable profitability, warranting a strong sell recommendation.

Keywords

Digital Asset Treasury, BERA, Berachain, Cryptocurrency, Blockchain, SEC Filing, 10-K, Nasdaq Delisting, Net Loss, Private Placement, Reverse Stock Split, Wholesale Distribution, Vaporizer Products, Cannabis Industry, Internal Controls, Risk Management, Staking, DeFi, Stablecoins, Corporate Governance