Datavault shares halve over inaccessible bitcoin and restatements

Datavault AI shares lost almost half their value after the Nasdaq-listed company disclosed that it could not withdraw bitcoin held through Biconomy and would revise financial statements covering several reporting periods.

The stock closed Tuesday at $0.067, down 49.55%, with approximately 244 million shares changing hands. The sell-off followed an October 26 regulatory filing detailing accounting errors linked to a $150 million share purchase agreement with Scilex Holding.

Datavault said the correction would reduce previously reported total assets by $92.2 million as of December 31, 2025, and $49 million as of June 30, 2026. Management is also reassessing whether its earlier assessment of the company’s ability to continue operating remains appropriate.

The company disclosed that it had requested a withdrawal of bitcoin from a digital wallet maintained at Biconomy in June. The transfer to an external account remained incomplete when Datavault filed its report with the US Securities and Exchange Commission on Monday.

Its filing did not establish why the withdrawal had failed or when access might be restored. The disclosure does not, by itself, establish that the bitcoin was stolen or permanently lost.

The disputed balances originated from an agreement signed on September 25, 2025, under which Scilex agreed to purchase 15 million Datavault common shares and a prefunded warrant covering 263,914,094 additional shares. The $150 million consideration was payable in bitcoin.

Under the arrangement, bitcoin was credited to Datavault’s Biconomy account through off-chain transfers, which record movements within an intermediary’s system rather than directly on the bitcoin blockchain. Datavault initially recognised the credited balances as digital assets on its financial statements.

Between September 26, 2025, and January 30, 2026, Datavault sold 491.431 bitcoin credited to that account back to Scilex through further off-chain transfers, receiving approximately $40.5 million in cash.

Following a review, Datavault concluded that the bitcoin associated with the original share transaction did not satisfy the requirements for recognition as its digital asset. Instead, the company said the transaction should have created a subscription receivable, reflecting consideration owed for shares issued.

Under the accounting treatment described in the filing, that receivable is presented as a reduction of shareholders’ equity, rather than an asset available to finance operations. The cash obtained through subsequent bitcoin transactions would reduce the amount receivable from Scilex.

The expected reductions in total assets also include $8.1 million at September 30, 2025, and $57.1 million at March 31, 2026. Those figures remain preliminary and unaudited, and Datavault warned that its review could identify further errors.

The company’s audit committee and management determined on October 20 that previously issued statements for the three and nine months ended September 2025, the full year ended December 2025, and the first two quarters of 2026 should no longer be relied upon.

Datavault intends to restate those accounts but has not established a timetable for completing the amended filings. That leaves investors awaiting revised figures for periods during which the company had treated the disputed bitcoin balances as part of its resources.

The accounting change also affects liquidity assumptions. Datavault said it had previously considered the bitcoin balances a potential source of funding for continuing operations, but uncertainty over collecting the consideration from Scilex requires management to revisit its going-concern evaluation.

A going-concern assessment considers whether a business can meet its obligations and remain operational over the relevant assessment period. Reconsidering that assessment does not automatically mean the company has concluded it cannot continue trading.

Datavault said it was still evaluating whether the errors indicated material weaknesses in internal controls over financial reporting. It has discussed the matter with its current auditor, CBIZ CPAs, and former auditor BPM.

The company identified additional risks involving its reliance on a third-party custodian, the collectability of amounts due from Scilex and the cooperation needed from Biconomy. Its filing also noted possible consequences for regulatory compliance and the timing of future financial reports.

The filing cautioned that the outcome of the accounting review could affect the company’s ability to maintain Nasdaq listing requirements, secure additional financing or meet reporting deadlines. It also identified potential litigation and regulatory inquiries among the risks arising from the restatement. Those possibilities were presented as risks, not as proceedings already initiated against the company.

The affected securities currently trade on the Nasdaq Capital Market under the ticker DVLT. Datavault’s headquarters are in Philadelphia, Pennsylvania.