Datavault AI disclosed in a Form 8-K filed with the SEC on October 26, 2026, that it requested a withdrawal of Bitcoin from a digital wallet maintained by Biconomy in June 2026 but had been unable to complete the withdrawal as of the filing date. The company’s shares fell 49.55% to $0.067 on October 27 after investors absorbed the disclosure alongside a planned accounting restatement that Datavault said could reduce its total assets by as much as $92.2 million.

Datavault Reassesses Its Bitcoin Holdings

According to the filing, counterparty Scilex Holding Company credited 1,309.04 BTC to Datavault’s Biconomy wallet through off-chain transfers. Datavault later sold 491.431 BTC back to Scilex for approximately $40.5 million in cash. The remaining balance was subsequently subject to Datavault’s attempt to withdraw the Bitcoin from the Biconomy custody arrangement.

The disclosure centers on how the Bitcoin should be classified for accounting purposes. Because the Bitcoin was credited through entries on Biconomy’s off-chain ledger rather than through on-chain transfers, Datavault now says the balance should be reclassified as a subscription receivable owed by Scilex instead of being reported as a digital asset held directly by Datavault. That reclassification is central to the company’s planned restatement. The distinction carries operational weight as well as accounting weight: an on-chain transfer is recorded on the Bitcoin blockchain itself and can be verified independently of any single company, whereas an off-chain credit exists only as a balance in the custodian’s own records until a matching on-chain withdrawal is executed.

Datavault’s board and management concluded that its previously issued financial statements should no longer be relied upon, and the company said it intends to restate those statements. The filing says the expected corrections would reduce total assets by $8.1 million as of September 30, 2025; $92.2 million as of December 31, 2025; $57.1 million as of March 31, 2026; and $49.0 million as of June 30, 2026.

The filing also said Datavault is reassessing its going-concern evaluation. Since the Bitcoin balances will no longer be presented as assets on the company’s books, and because the collection of amounts owed by Scilex is uncertain, Datavault acknowledged that its ability to continue as a going concern is now in question. Going-concern assessments are a standard element of financial reporting and ask whether a company can meet its obligations for a defined period ahead; when substantial doubt exists, a company is required to disclose it explicitly in its filings.

Shares Drop After Bitcoin Disclosure

DVLT shares lost nearly half their value in a single trading session after the filing became public. The 49.55% decline to $0.067 on October 27 followed concern over both the inaccessible Bitcoin holdings and the scale of the planned restatement. Together, those issues raised questions about the reliability of the company’s reported balance sheet.

Bitcoin was trading at approximately $79,916 and was down about 1.2% on the day when Datavault shares fell. The company said the broader decline in Bitcoin was therefore not a meaningful driver of the stock move. The timing highlighted the company-specific nature of the sell-off after the custody and accounting issues surrounding Datavault’s Bitcoin treasury strategy became known.

Other companies pursuing Bitcoin treasury strategies, including firms that have paused Bitcoin purchases while managing their capital structures, have also faced scrutiny over the treatment of digital assets on their balance sheets. Corporate adoption of Bitcoin as a treasury reserve asset expanded markedly after 2020, when a small group of publicly listed companies first disclosed allocations to the asset, and the custody and accounting treatment of such holdings has since been a recurring focus for investors and auditors. In Datavault’s case, the transaction chain involving Scilex and Biconomy Pte. Ltd. added complexity to the disclosure.

Scilex’s own SEC quarterly filing describes a $200 million Bitcoin transaction involving Semnur shares and the use of $150 million in Bitcoin to purchase Datavault stock. The arrangement positioned Biconomy as a participant in the broader transaction structure rather than merely as a conventional custodian. Investors in companies with similarly structured Bitcoin arrangements have been closely monitoring Bitcoin price pressure near the $80,000 level because asset valuations at those levels directly affect balance-sheet calculations.

Questions About the Withdrawal and Restatement Remain

The most immediate unanswered question is whether, and when, Datavault can complete the Bitcoin withdrawal. The filing states that the request made in June remained incomplete as of October 26, 2026. It does not explain what is blocking the transfer, whether Biconomy has disputed the request, or which legal or contractual mechanisms Datavault is pursuing.

Investors will also be watching to see whether the restatement process identifies additional errors. Datavault’s filing expressly warned that its ongoing review could uncover further accounting issues or result in delays in submitting required SEC filings. Although such language is a standard caveat in a disclosure of this type, it leaves the potential scope of the accounting problem unresolved.

The going-concern warning adds to that uncertainty. If the restated financial statements remove the Bitcoin holdings from Datavault’s assets and Scilex’s payment obligations prove uncollectable, the company’s reported net asset position could decline substantially.

The counterparty relationship with Scilex is another key issue. The off-chain nature of the original Bitcoin credits, together with the $40.5 million buyback transaction already completed between the companies, means that resolving the current dispute may depend as much on negotiations with Scilex as on cooperation from Biconomy. The arrangement also raises questions about whether digital assets associated with a corporate treasury are directly controlled by the reporting company or depend on entries maintained by a third party.

The regulatory dimension adds another layer. Datavault filed the 8-K under Item 4.02, which addresses non-reliance on previously issued financial statements and a decision to restate them. The filing indicates to the SEC that the company’s earlier disclosures were materially inaccurate and can lead to additional inquiries even when a company reports the issue itself.

Investors who purchased shares while relying on the Bitcoin valuations that are now being treated as overstated will be monitoring future filings for any SEC correspondence. Datavault’s restated financial statements, once filed, will also provide the first concrete view of the revised asset figures and the outcome of the going-concern assessment. More broadly, the case could inform continuing policy discussions about how cryptocurrency custody arrangements should be reflected on public-company balance sheets and what disclosure standards should apply to digital asset holdings.

Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice. Cryptocurrency and digital asset markets carry significant risk. Always conduct your own research before making decisions.