Datavault AI plunged 49.55% to close at $0.067 on Tuesday after a filing disclosed the company has been unable to withdraw bitcoin from crypto exchange Biconomy since June and will restate its financial results. Roughly 244 million shares changed hands during the session.
The bitcoin exposure stems from a September 2025 agreement with Scilex Holding Company to purchase $150 million of Datavault shares and warrants using bitcoin. Scilex credited 1,309.04 BTC to Datavault’s Biconomy account through off-chain transfers. Datavault later sold 491.4 BTC back to Scilex for about $40.5 million in cash.
Why can’t Datavault AI access its bitcoin?
The company said it has been unable to withdraw bitcoin from Biconomy since June, despite an internal-account credit of 1,309.04 BTC tied to a 2025 equity-and-warrants purchase by Scilex Holding Company. The credits were off-chain transfers on the exchange ledger, and the withdrawal inability now necessitates a restatement of financial results.
The arrangement relied on balances updated within Biconomy rather than transactions recorded on the Bitcoin blockchain. After receiving the credited BTC, Datavault sold 491.4 BTC back to Scilex for approximately $40.5 million in cash. The subsequent inability to withdraw remaining bitcoin prompted the disclosure and triggered the stock’s sharp repricing.
Metric | Value | Context |
|---|
Share price close | $0.067 | October 28 session |
Daily change | -49.55% | Intraday plunge |
Trading volume | ~244,000,000 shares | Elevated activity |
BTC credited | 1,309.04 BTC | Off-chain exchange credits |
BTC sold back | 491.4 BTC | Proceeds in cash |
Cash received | ~$40.5 million | From sale to Scilex |
What are the financial and market implications?
Datavault will restate its financial results due to the inability to withdraw bitcoin, signaling potential balance sheet and revenue recognition impacts related to off-chain exchange credits. Markets swiftly repriced the risk, sending shares down 49.55% to $0.067 on roughly 244 million shares traded.
The 2025 agreement with Scilex Holding Company involved a planned $150 million purchase of shares and warrants using bitcoin, executed via off-chain credits at Biconomy. While Datavault monetized a portion—491.4 BTC for about $40.5 million—access to remaining balances became uncertain when withdrawals could not be executed starting in June. The disclosure consolidates counterparty and custody risk into a single point of failure at the exchange level, with implications for treasury management practices that rely on internal ledgering rather than on-chain settlement.
The episode underscores the operational risk of holding cryptocurrency on centralized venues where off-chain credits may not translate into timely withdrawals. For listed companies with bitcoin treasury strategies, the distinction between ledger credits and on-chain control can become material when preparing financial statements and guiding investors on liquidity.
Datavault’s filing reframes the company’s crypto exposure as contingent on successful withdrawal from Biconomy. The market reaction reflects uncertainty around recoverability and timing, alongside the accounting adjustments needed to reflect accessible versus credited assets.
Datavault did not disclose additional resolutions in the filing excerpt, beyond indicating that results would need to be restated. Investors will look to forthcoming disclosures for clarity on the status of the credited BTC and any adjustments to prior revenue or asset recognition.
Looking ahead, the company’s ability to quantify the impact of the restatement, detail the status of bitcoin held at Biconomy, and outline custodial safeguards will shape market confidence.
