The stock of Datavault AI (NASDAQ: DVLT) declined 49.55% on Tuesday, closing at approximately 0.067 US dollars, after the company disclosed that it has been unable to withdraw 1,328.43 Bitcoin from the cryptocurrency exchange Biconomy since June 2026. The sell-off erased nearly half of the firm’s market value in a single trading session.
The Bottom Line
- Datavault AI reported it cannot access its Bitcoin holdings on the Biconomy exchange, leading to a nearly 50% single-day drop in its stock price to about 0.067 US dollars on heavy volume of roughly 244 million shares.
- The company will restate four financial reports—covering the period from the third quarter of 2025 through the second quarter of 2026—reducing its previously reported assets by up to 92.2 million US dollars.
- According to coinpaprika.com, the frozen digital assets originate from a September 2025 securities purchase agreement with the Scilex Holding Company, wherein Scilex paid for Datavault stock and warrants using Bitcoin.
Unaccessible Digital Assets and SEC Form 8-K Disclosures
The asset access crisis came to light when Datavault AI filed a Form 8-K with the US Securities and Exchange Commission on October 26, 2026. According to coinpaprika.com, the firm attempted to transfer its Bitcoin holdings to an external wallet, but the transaction could not be completed. The digital assets remained locked on Biconomy Pte. Ltd. at the time of the regulatory filing. coinpaprika.com reported that the frozen funds trace back to a September 2025 transaction with the Scilex Holding Company, in which Scilex transferred Bitcoin valued at approximately 150 million US dollars to purchase Datavault shares and warrants.
Further details from coinpaprika.com indicate that Scilex made partial payments on September 26 and November 25, 2025, crediting 1,309.04 BTC to Datavault’s account through off-chain transfers. These internal ledger movements did not execute on the public Bitcoin blockchain. Between September 2025 and January 2026, Datavault subsequently sold 491.431 BTC back to Scilex for approximately 40.5 million US dollars in cash, leaving the remaining balance trapped on the exchange.
Financial Restatements and Asset Reductions
As a direct consequence of the withdrawal failure, the company’s audit committee determined that the Bitcoin holdings never qualified as Datavault’s own digital assets under US accounting standards. Consequently, Datavault AI announced plans to correct four financial reports spanning late 2025 through mid-2026, while the company disclosed that its Bitcoin could not be withdrawn from the exchange Biconomy.
| Reporting Period | Asset Reduction (US Dollars) |
|---|---|
| End of September 2025 | 8.1 million |
| End of Year 2025 | 92.2 million |
| End of March 2026 | 57.1 million |
| End of June 2026 | 49.0 million |
In its official SEC filing Form 8-K dated October 26, 2026, the company stated that investors should no longer rely on the affected financial reports, previous earnings releases, or related investor presentations. blocktrainer.de observed that institutional holding of digital assets via third-party custodians introduces profound counterparty risks, where shareholders depend not only on corporate governance but also on the operational stability of external service providers.
Disclaimer: The information provided in this article is for educational and informational purposes only and does not constitute financial advice.
