Nasdaq-Listed Firm’s Stock Plunges After Losing Access to Bitcoin, Spotlighting Treasury Risks

On Oct. 26, tech company Datavault AI disclosed that it had been unable to withdraw bitcoin from the Biconomy crypto exchange since June 2026. The next day, the company’s share price plunged around 50% and has yet to recover, with its market capitalization now hovering near $65 million. The filing does not say why the withdrawal failed, and neither Datavault nor Biconomy has made any other public statement on the matter.

Internal off-Chain Transfers

The “not your keys, not your coins” theme runs through every step of this bitcoin’s journey, starting in September 2025, when biopharma company Scilex agreed to buy Datavault shares and a pre-funded warrant for $150 million paid in bitcoin. Scilex got that bitcoin directly from Biconomy: Two days earlier, Scilex had agreed to sell $200 million worth of stock in its subsidiary Semnur to Biconomy in exchange for bitcoin. Scilex later said it had used $150 million of that bitcoin to buy the Datavault shares. Scilex also signed a memorandum of understanding with Biconomy to cooperate on crypto and treasury strategy.

Datavault claims that 1,309 BTC was sent to its Biconomy wallet through an off-chain transfer. This means the transfer took place internally on the exchange, with nothing recorded on the Bitcoin blockchain. Datavault never had the private keys to this bitcoin.

According to the company, between September 2025 and January 2026, it sent 491.431 BTC back to Scilex, also off-chain. That leaves about 817.6 BTC, worth roughly $66 million at current prices, in the account it says it cannot access. According to Biconomy’s self-reported proof of reserves, the exchange held $197 million in crypto assets at the time of writing, with BTC comprising 73% of its reserves.

Because Datavault could not prove that it controlled the BTC, the bitcoin should not have been recognized as an asset on its balance sheet under the applicable accounting standards. The company now says it must correct its financial reports accordingly and has told investors not to rely on its four most recent financial reports.

Investor Turned Debtor

Now, under the revised accounting treatment, Scilex, Datavault’s major investor, is treated as a debtor to Datavault. However, Datavault says it is unsure whether it will be able to recover that money. As of June 30, Scilex already owed Datavault $8.8 million of a $10 million licensing fee, while Scilex affiliate Vivasor owed $15 million of a $20 million fee.

Meanwhile, if the BTC withdrawal had been stuck since June, Datavault was still presenting the bitcoin as a resource for paying bills in its quarterly report in August. During the same period, the company was also promoting the launch of its own meme coin on Biconomy.

Risks for Companies and Investors

In any case, while various questions about this story remain unanswered, the key point is clear: A company’s inability to access its bitcoin can hurt investors.

According to Bitcointreasuries.net, 201 public companies hold 1.296 million BTC, worth $105 billion, on their balance sheets. However, even Strategy, which holds 65% of that total, does not publish proof of reserves or its wallet addresses. Instead, onchain analysts such as Arkham try to identify those addresses themselves.

In 2025, co-founder Michael Saylor said publishing wallet addresses would create security and operational risks and that making Strategy’s bitcoin movements public could scare traders. Strategy’s investors therefore have to trust that the company can access its bitcoin, which it keeps with regulated custodians without publishing the full list. Coinbase has confirmed that it is one of those custodians, and Arkham says it has traced part of the holdings to Fidelity. The same need for trust applies to other public companies that do not fully disclose their bitcoin holdings.

Choose Your Trust Level

In contrast, Metaplanet and Twenty One Capital have published their BTC holding addresses, allowing investors to verify their holdings onchain. However, both companies also depend on third parties because they use custodians to store their BTC.

Meanwhile, Bitcoin bull Jack Dorsey’s Block launched an onchain proof-of-reserves dashboard in April, covering its corporate treasury as well as bitcoin held for Cash App and Square customers. In September, Block applied to the U.S. Office of the Comptroller of the Currency for a national trust bank charter, which would allow it to custody bitcoin and stablecoins under federal oversight.

Therefore, bitcoin treasury investors can decide what level of trust they are comfortable with when choosing a company to invest in.

Bitcoin.com News has contacted Datavault AI, Biconomy and Scilex for comment and will update this article if they respond.