$12 Million Faraday Investment Exacerbates AI Crypto Startup's Cash Crisis

A pre-revenue AI crypto startup called AIxCrypto Holdings has seen its cash reserves dwindle by an astonishing 97% in just six months, according to recent financial reports. The company's balance sheet showed a decline from $19.33 million at the end of December to $577,328 at June 30.

The main culprit behind this drastic drop was the loss on digital assets, which plummeted by 49% in fair value. AIxCrypto's Bitcoin holdings accounted for $2.70 million, or about 52%, of its portfolio, leaving the remaining holdings vulnerable to crypto-market volatility.

The company has also made a significant investment in EV firm Faraday Future, funneling $12 million into their securities through an entrusted arrangement with Gold King Arthur Holding Limited. AIxCrypto identifies Faraday Future as its controlling majority stockholder, making this investment an allocation involving the company that controls it rather than an unrelated portfolio holding.

The startup's current liabilities stand at a staggering $1.72 million, nearly three times its cash balance. However, an announced common-stock purchase agreement could provide up to $50 million in funding, subject to various conditions and requirements.