The $1 billion price Facebook agreed to shell out for Instagram back in April might turn out to be more than 25% lighter by the time the deal finally goes through. That deal was based on $300 million in cash and 23 million shares of Facebook stock, which hit new lows this month.

As the San Francisco Business Journal reports today, the billion dollar deal has lost more than $273 million dollars — over a quarter of its value — while the deal is held up in government hearings at the FTC. During one recent hearing, the Department of Corporations finally permitted Facebook to issue the class B shares to Instagram, even though share prices have dropped from the IPO price of $38 to today's closing price at 19 bucks and change.

Although the atmosphere at the paper trail-generating hearings is reportedly pretty stuffy, AllThingsD reports that Instagram founder Kevin Systrom has been a standout player. When asked by a Department of Corporations officer how the photo sharing app company generates revenue, Systrom quipped: "That’s a great question — as of right now we do not."

Instagram has lost $2.7 million in the past two years, a number AllThingsD notes is "still fairly low" given how few employees Instagram has and the nearly $51 million it raised in total before Facebook's big announcement.

Previously: All Facebook IPO Coverage on SFist