Datavault AI shares fell about 50% after the company disclosed that it had been unable to complete a Bitcoin withdrawal for months and would restate its past financial statements.
According to an SEC filing dated October 26, cited by The Block, the company wanted to withdraw Bitcoin from a third-party wallet to an external account in June but had been unable to complete the transaction as of the filing date. No details were shared about why the withdrawal could not be completed.
DVLT shares closed October 27 at around $0.067, down 49.6% from the previous close. About 250 million shares changed hands during the session, with trading volume rising to eight times the previous day’s level.
How was the $150 million deal structured?
At the center of the issue is an agreement signed in September 2025 between Datavault AI and Scilex Holding. Scilex agreed to acquire 15 million common shares and a prepaid warrant covering more than 263.9 million shares for a total of $150 million.
Payment was to be made in Bitcoin. At the agreed value of $112,915.52 per BTC, the amount corresponded to approximately 1,328.43 BTC. The Bitcoin balance was recorded through an off-chain transfer to the company’s wallet on a third-party platform.
Between September 2025 and January 2026, Datavault AI sold part of this balance back to Scilex, receiving approximately $40.5 million in cash. However, an attempt to withdraw the remaining Bitcoin in June was unsuccessful.
Bitcoin will be shown as a receivable instead of an asset on the balance sheet
The company concluded that the amounts related to the Scilex transaction did not meet the criteria for being recorded as digital assets. It therefore stated that its previously published financial statements covering more than a year should no longer be relied upon.
In the restatement, the amounts in question will be recorded as a receivable arising from the issuance of shares and deducted from shareholders’ equity. Total assets are expected to decrease by the following amounts at different balance-sheet dates:
- September 30, 2025: $8.1 million
- December 31, 2025: $92.2 million
- March 31, 2026: $57.1 million
- June 30, 2026: $49 million
These figures reflect balance-sheet adjustments at different dates; they do not represent a single total loss amount.
The company’s cash plan is also being reassessed
Because management had previously considered the Bitcoin balances an available source of liquidity, it is also revisiting its assessment of the company’s ability to continue operating. The amount that may be collected from Scilex remains uncertain, and a publication date for the restated financial statements has not yet been determined.
Not investment advice.