Datavault AI shares plunge 50% after firm says it cannot access its bitcoin holdings

Company to restate financials, reducing reported assets by over $92 million

By LineZotpaper AI staff

Published28 October 2026

Updated28 October 2026

Read Time2 min

Sources2 outlets

Illustration: Datavault AI shares plunge 50% after firm says it cannot access its bitcoin holdings

Shares of Datavault AI fell nearly 50 percent on Tuesday after the company disclosed in a regulatory filing that it had been unable to withdraw bitcoin from the Biconomy exchange since June and would have to restate its financial results. The stock closed at $0.067 with roughly 244 million shares traded.

The problem stems from a September 2025 agreement with Scilex Holding Company, which agreed to purchase $150 million worth of Datavault shares and warrants using bitcoin. Scilex credited 1,309.04 BTC to Datavault’s account at Biconomy through off-chain transfers, meaning the balances were adjusted within the exchange rather than recorded on Bitcoin’s blockchain.

Datavault subsequently sold 491.4 BTC back to Scilex for about $40.5 million in cash. But when it requested a withdrawal of the remaining bitcoin to an external account in June, the transfer could not be completed and remained unresolved as of Monday’s filing, the company said.

Datavault now says the bitcoin credited through Scilex’s investment should have been recorded as an amount Scilex owed for the shares, reducing shareholders’ equity rather than appearing among Datavault’s cryptocurrency assets. The correction is expected to reduce reported assets by $92.2 million at the end of 2025 and $49 million as of June 2026. Datavault had counted those bitcoin balances as money it could draw on to sustain operations but must now revisit that assessment.

CoinDesk contacted Biconomy about the withdrawal request and the bitcoin backing Datavault’s account and did not receive a response as of Wednesday afternoon in Asia.

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Analysis

Why This Matters

The incident highlights the risks companies face when counting crypto held on exchanges as liquid assets, especially when custody is uncertain.
Datavault’s restatement may erode investor confidence in other firms using similar off-chain bitcoin treasury strategies.
The ongoing inability to access bitcoin since June raises questions about the reliability of exchange-based custody for corporate treasuries.

Background

Datavault AI, a company that holds bitcoin as a treasury asset, entered into an agreement in September 2025 with Scilex Holding Company, which purchased $150 million of Datavault shares using bitcoin. The bitcoin was credited to Datavault’s account on the Biconomy exchange through off-chain transfers, meaning the balances moved within the exchange’s internal ledger rather than on the Bitcoin blockchain. Datavault later sold some of that bitcoin back to Scilex for cash. When it attempted to withdraw the remaining bitcoin to an external account in June 2026, Biconomy did not process the withdrawal, and as of late October the funds remained inaccessible. The company now says the bitcoin should have been recorded as a receivable from Scilex rather than as a crypto asset, reducing reported assets significantly.

What to Watch

Whether Biconomy provides an explanation for the withdrawal failure and whether the bitcoin is ultimately recoverable.
Potential regulatory or legal action by Datavault shareholders in response to the disclosure and restatement.
How other companies with crypto treasuries reassess their accounting and custody practices in light of this situation.

Sources

Checked

12 claims in this story checked against 1 source: 10 supported.

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SupportedDatavault AI shares plunged nearly 50% on Tuesday after the company said it could not access its bitcoin holdings.CoinDesk: Bitcoin, Ethereum, Crypto News and Price Data: “Datavault AI (DVLT) shares plunged nearly 50% on Tuesday after a filing revealed that the company had been unable to withdraw bitcoin from crypto exchange Biconomy since June”
Partly supportedThe restatement is expected to reduce reported assets by over $92 million.CoinDesk: Bitcoin, Ethereum, Crypto News and Price Data: “The correction is expected to reduce reported assets by $92.2 million at the end of 2025 and $49 million as of June 2026.”
Partly supportedThe company disclosed its inability to withdraw bitcoin in a regulatory filing.CoinDesk: Bitcoin, Ethereum, Crypto News and Price Data: “Datavault AI (DVLT) shares plunged nearly 50% on Tuesday after a filing revealed that the company had been unable to withdraw bitcoin from crypto exchange Biconomy since June”
SupportedDatavault would have to restate its financial results.CoinDesk: Bitcoin, Ethereum, Crypto News and Price Data: “Datavault AI (DVLT) shares plunged nearly 50% on Tuesday after a filing revealed that the company had been unable to withdraw bitcoin from crypto exchange Biconomy since June and would have to restate its financial results.”
SupportedA September 2025 agreement had Scilex agree to purchase $150 million of Datavault shares and warrants using bitcoin.CoinDesk: Bitcoin, Ethereum, Crypto News and Price Data: “The problem traces back to a September 2025 agreement with Scilex Holding Company, which agreed to purchase $150 million of Datavault shares and warrants using bitcoin.”
SupportedScilex credited 1,309.04 BTC to Datavault’s Biconomy account through off-chain transfers, changing balances within the exchange rather than recording transactions on Bitcoin’s blockchain.CoinDesk: Bitcoin, Ethereum, Crypto News and Price Data: “Scilex credited 1,309.04 BTC to Datavault’s account at Biconomy through off-chain transfers, meaning the balances changed within the exchange rather than through transactions on Bitcoin’s blockchain.”
SupportedDatavault later sold 491.4 BTC back to Scilex for about $40.5 million in cash.CoinDesk: Bitcoin, Ethereum, Crypto News and Price Data: “Datavault subsequently sold 491.4 BTC back to Scilex for about $40.5 million in cash.”
SupportedA withdrawal to an external account requested in June could not be completed and remained unresolved as of Monday’s filing.CoinDesk: Bitcoin, Ethereum, Crypto News and Price Data: “But the transfer could not be completed when it requested a withdrawal to an external account in June, the comapny said, and remained incomplete as of Monday’s filing.”
SupportedDatavault says the bitcoin credited through Scilex’s investment should have been recorded as an amount Scilex owed for the shares, reducing shareholders’ equity rather than appearing among its cryptocurrency assets.CoinDesk: Bitcoin, Ethereum, Crypto News and Price Data: “Datavault now says the bitcoin credited through Scilex’s investment should have been recorded as an amount Scilex owed for the shares. That amount would reduce shareholders’ equity instead of appearing among Datavault’s cryptocurrency assets.”
SupportedThe correction is expected to reduce reported assets by $92.2 million at the end of 2025 and $49 million as of June 2026.CoinDesk: Bitcoin, Ethereum, Crypto News and Price Data: “The correction is expected to reduce reported assets by $92.2 million at the end of 2025 and $49 million as of June 2026.”
SupportedDatavault had counted the bitcoin balances as money it could draw on to sustain operations and must now revisit that assessment.CoinDesk: Bitcoin, Ethereum, Crypto News and Price Data: “Datavault had counted those bitcoin balances as money it could draw on to keep the business running, but must now revisit the assessment.”
SupportedCoinDesk contacted Biconomy about the withdrawal request and bitcoin backing Datavault’s account and received no response as of Wednesday afternoon in Asia.CoinDesk: Bitcoin, Ethereum, Crypto News and Price Data: “CoinDesk contacted Biconomy about the withdrawal request and the bitcoin backing Datavault’s account and did not receive a response as of Asian afternoon hours Wednesday.”