---
title: "Datavault AI Plunges 50% After Disclosing Inaccessible Bitcoin on Biconomy"
description: "The company revealed it has been unable to withdraw its bitcoin balance since June, forcing a financial restatement cutting up to $92.2 million in assets."
url: https://basisdesk.news/news/datavault-ai-plunges-biconomy-bitcoin-withdrawal-failure
published: 2026-10-28T05:36:28.694Z
modified: 2026-10-28T05:36:28.694Z
section: Institutions & ETFs
author: Basis Desk Newsroom (AI-generated, source-verified)
sentiment: bearish
tickers: [BTC]
tags: [datavault-ai, biconomy, scilex, corporate-treasury, custody]
license: Quote with attribution to Basis Desk (basisdesk.news). Not financial advice.
---

# Datavault AI Plunges 50% After Disclosing Inaccessible Bitcoin on Biconomy

The company revealed it has been unable to withdraw its bitcoin balance since June, forcing a financial restatement cutting up to $92.2 million in assets.

## At a glance

- **What happened:** Datavault AI disclosed it has been unable to withdraw its bitcoin from Biconomy since June and will restate financial reports.
- **Why it matters:** The company must erase up to $92.2 million in reported balance sheet assets after relying on off-chain exchange credits for operational liquidity.
- **Who is affected:** Datavault AI shareholders, Scilex Holding Company, and crypto exchange Biconomy.
- **What's next:** Datavault must complete its financial restatement while attempting to resolve the pending June withdrawal request.
- **Primary source:** [Bitcoin treasury stock plunges 50% after firm says it can’t access its BTC](https://www.coindesk.com/markets/2026/10/28/bitcoin-treasury-datavault-ai-plunges-50-after-firm-says-it-can-t-access-its-btc) — coindesk.com

## Key points

- Datavault AI stock dropped 49.55% to $0.067 after revealing frozen Biconomy bitcoin balances.
- The firm has been unable to withdraw its remaining bitcoin to an external wallet since June.
- Accounting corrections will reduce reported assets by $92.2 million for 2025 and $49 million for mid-2026.

## Editorial remark

- **Context:** Datavault accepted off-chain exchange account balance credits from Scilex instead of on-chain Bitcoin transactions to fund an equity investment.
- **Impact:** Datavault must restate its balance sheet, eliminating up to $92.2 million in crypto assets that it previously planned to tap for operational liquidity.
- **Watch:** Datavault's forthcoming amended filings and any response or resolution from Biconomy regarding the frozen balances.

Datavault AI shares plunged 49.55% on Tuesday after the firm disclosed in a filing that it has been unable to withdraw its bitcoin holdings from cryptocurrency exchange Biconomy since June [1]. The company stated that the unresolved withdrawal will require it to restate previous financial results and reassess whether those funds can sustain operating activities [1]. Datavault stock closed at $0.067 on Tuesday with approximately 244 million shares changing hands [1].

The asset balance originated from a September 2025 transaction in which Scilex Holding Company agreed to acquire $150 million worth of Datavault shares and warrants using $BTC [1]. Scilex credited 1,309.04 BTC to Datavault’s Biconomy account using off-chain book transfers rather than on-chain settlements [1]. While Datavault subsequently sold 491.4 BTC back to Scilex for approximately $40.5 million in cash, its attempt to withdraw the remaining balance to an external wallet in June failed to execute and remained unresolved through Monday's filing [1].

## Off-Chain Transfers and Accounting Revisions

According to financial filings, Biconomy supplied the underlying cryptocurrency after purchasing $200 million in shares of Scilex subsidiary Semnur in exchange for bitcoin, after which Scilex allocated $150 million into Datavault securities [1]. Datavault concluded that the credited cryptocurrency should have been categorized as a receivable owed by Scilex rather than direct digital asset holdings [1].

Accounting revisions will reduce Datavault’s reported assets by $92.2 million at the end of 2025 and by $49 million as of June 2026, offsetting shareholders' equity [1]. The operational snag comes as [corporate bitcoin treasury buying slows sharply](https://basisdesk.news/news/corporate-bitcoin-treasury-buying-slows-q3), placing additional scrutiny on corporate custody setups. Biconomy did not provide a comment regarding the withdrawal status [1]. At the time of writing, Bitcoin traded at $80,851.

## Sources

1. [Bitcoin treasury stock plunges 50% after firm says it can’t access its BTC](https://www.coindesk.com/markets/2026/10/28/bitcoin-treasury-datavault-ai-plunges-50-after-firm-says-it-can-t-access-its-btc) — coindesk.com, 2026-10-28

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Basis Desk Newsroom · AI-generated, source-verified · https://basisdesk.news/about/how-we-use-ai