~~UNITED~~ ~~STATES~~ false ~~SECURITIES~~ FY 0001767057 Unlimited Unlimited ~~AND~~ ~~EXCHANGE COMMISSION~~ ~~Washington,~~ 0001767057 2025-01-01 2025-12-31 0001767057 2025-06-30 0001767057 2026-03-27 0001767057 2025-10-01 2025-12-31 0001767057 2025-12-31 0001767057 2024-12-31 0001767057 2024-01-01 2024-12-31 0001767057 2023-12-31 0001767057 us-gaap:FairValueInputsLevel1Member 2025-12-31 0001767057 us-gaap:FairValueInputsLevel2Member 2025-12-31 0001767057 us-gaap:FairValueInputsLevel3Member 2025-12-31 0001767057 us-gaap:FairValueInputsLevel1Member 2024-12-31 0001767057 us-gaap:FairValueInputsLevel2Member 2024-12-31 0001767057 us-gaap:FairValueInputsLevel3Member 2024-12-31 0001767057 OBTC:OnInvestmentInBitcoinMember 2025-01-01 2025-12-31 0001767057 OBTC:OnInvestmentInBitcoinMember 2024-01-01 2024-12-31 0001767057 OBTC:ResultingFromTheChangeInLiabilitiesDenominatedInBitcoinMember 2025-01-01 2025-12-31 0001767057 OBTC:ResultingFromTheChangeInLiabilitiesDenominatedInBitcoinMember 2025-12-31 0001767057 OBTC:ResultingFromTheChangeInLiabilitiesDenominatedInBitcoinMember 2024-01-01 2024-12-31 0001767057 OBTC:ResultingFromTheChangeInLiabilitiesDenominatedInBitcoinMember 2024-12-31 0001767057 OBTC:SponsorMember 2025-01-01 2025-12-31 0001767057 OBTC:SponsorMember 2024-01-01 2024-12-31 0001767057 OBTC:DueToSponsorMember 2025-01-01 2025-12-31 0001767057 OBTC:DueToSponsorMember 2024-01-01 2024-12-31 0001767057 OBTC:AnaxTradingLLCMember 2024-03-27 2024-03-27 0001767057 2024-03-27 2024-03-27 0001767057 us-gaap:RestrictedStockMember 2024-12-31 0001767057 us-gaap:RestrictedStockMember 2024-01-01 2024-12-31 0001767057 us-gaap:RestrictedStockMember 2025-12-31 0001767057 us-gaap:SubsequentEventMember 2026-03-27 0001767057 us-gaap:SubsequentEventMember 2026-03-27 2026-03-27 0001767057 us-gaap:SubsequentEventMember 2026-03-31 iso4217:USD xbrli:shares iso4217:USD xbrli:shares xbrli:pure ~~D.C. 20549~~

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 10-K

☒	ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, ~~2022~~ 2025

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period ~~from______to_____~~from _____________ to ______________

Commission ~~File~~ ~~Number~~file ~~000~~number 001-~~56307~~43024

Osprey Bitcoin Trust

(Exact ~~Name~~name of ~~Registrant~~registrant as ~~Specified~~specified in ~~Its~~its ~~Charter~~charter)

Delaware (State or Other Jurisdiction of Incorporation or Organization) 37-6695894 I.R.S. Employer Identification No.)

Delaware

37-6695894

(State or other jurisdiction of
incorporation or organization)

(I.R.S. Employer

Identification No.)

~~1241 Post~~777 ~~Road,~~Brickell ~~2nd Floor~~Avenue

~~Fairfield, CT 06824~~Suite 500

Miami, FL 33131 (914) 214-4697 (Address, ofincluding ~~Principal~~zip ~~Executive~~code, ~~Offices)~~and telephone number, ~~(Zip~~including ~~Code~~area code, of registrant’s principal executive offices)

Securities registered pursuant to Section 12(~~914~~b) ~~214-4697~~of the Act:

Title of each class Trading symbol(~~Registrant’~~s) ~~telephone~~Name ~~number, including~~of ~~area~~each ~~code)~~exchange on which registered Shares of Beneficial Interest of Osprey Bitcoin Trust OBTC The Nasdaq Stock Market LLC

Securities registered pursuant to Section 12(bg) of the Act: None .

~~Title~~Indicate by ofcheck ~~each~~mark ~~class~~if ~~Trading~~the ~~Symbol(s)~~registrant ~~Name~~is ofa ~~each~~well-known ~~exchange~~seasoned onissuer, ~~which~~as ~~registered~~defined ~~N/A~~in ~~N/A~~Rule ~~N/A~~405 of the Securities Act. Yes ☐ No ☒.

~~Securities~~Indicate by ~~registered~~check mark if the registrant is not required to file reports pursuant to Section 1213 or Section 15(gd) of the Act:. ~~Osprey~~Yes ~~Bitcoin~~☐ ~~Trust~~No ~~Units~~☒.

Indicate by check mark ifwhether the registrant is a(1) ~~well-known~~has ~~seasoned~~filed ~~issuer,~~all asreports ~~defined~~required into ~~Rule~~be ~~405~~filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☐☒ No ☒☐.

Indicate by check mark ifwhether the registrant ishas ~~not~~submitted electronically every Interactive Data File required to ~~file~~be ~~reports~~submitted pursuant to ~~Section~~Rule 405 13of orRegulation ~~Section~~S-T 15(d)§ 232.405 of this chapter) during the ~~Act~~preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☐ ☒ No ☒☐.

Indicate by check mark whether the registrant ~~(1)~~is ~~has~~a ~~filed~~large ~~all~~accelerated ~~reports~~filer, ~~required~~an toaccelerated befiler, ~~filed~~a bynon-accelerated ~~Section~~filer, 13a orsmaller ~~15(d) of the Securities Exchange Act of~~reporting ~~1934~~company, ~~during the preceding 12 months (~~or ~~for~~an ~~such~~emerging ~~shorter~~growth ~~period~~company. ~~that~~See the ~~registrant~~definitions ~~was~~of ~~required~~“large toaccelerated ~~file such reports)~~filer,” ~~and~~“accelerated ~~(2)~~filer,” ~~has~~“smaller ~~been~~reporting ~~subject~~company,” toand ~~such~~“emerging ~~filing~~growth ~~requirements~~company” ~~for~~in ~~the~~Rule ~~past~~12b-2 90of ~~days.~~the ~~Yes~~Exchange ~~☒ No ☐~~Act.

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒☐

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. ~~Yes~~ ☐ ~~No ☐~~

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒.

State the aggregate market value of the shares held by non-affiliates of the registrant as of June 30, 2025: $198,196,607.

As of March 27, 2026, Osprey Bitcoin Trust had 2,940,535 shares outstanding.

DOCUMENTS INCORPORATED BY REFERENCE: None.

TABLE OF CONTENTS

		Page

GLOSSARY OF DEFINED TERMS		i

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS		vi

PART I		1

ITEM 1.	BUSINESS	1

ITEM 1A.	RISK FACTORS	31

ITEM 1B.	UNRESOLVED STAFF COMMENTS	61

ITEM 1C.	CYBERSECURITY	61

ITEM 2.	PROPERTIES	61

ITEM 3.	LEGAL PROCEEDINGS	61

ITEM 4.	MINE SAFETY DISCLOSURES	61

PART II		62

ITEM 5.	MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES	62

ITEM 6.	RESERVED	62

ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	63

ITEM 7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	65

ITEM 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA	65

ITEM 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE	65

ITEM 9A.	CONTROLS AND PROCEDURES	65

ITEM 9B.	OTHER INFORMATION	65

ITEM 9C.	DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS	65

PART III		66

ITEM 10.	DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE	66

ITEM 11.	EXECUTIVE COMPENSATION	66

ITEM 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS	66

ITEM 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE	67

ITEM 14.	PRINCIPAL ACCOUNTANT FEES AND SERVICES	68

PART IV		69

ITEM 15.	EXHIBITS AND FINANCIAL STATEMENT SCHEDULES	69

ITEM 16.	FORM 10-K SUMMARY	69

GLOSSARY OF DEFINED TERMS

In this Annual Report, each of the following terms have the meanings set forth after such term:

“2022 Events” - The following events that occurred in 2022: in the first half of 2022, each of Celsius Network, Voyager Digital Ltd., and Three Arrows Capital declared bankruptcy, resulting in a loss of confidence in participants of the digital asset ecosystem and negative publicity surrounding digital assets more broadly. In November 2022, FTX, one of the largest digital asset platforms by volume at the time, halted customer withdrawals amid rumors of the company’s liquidity issues and likely insolvency, which were subsequently corroborated by its CEO. Shortly thereafter, FTX’s CEO resigned and FTX and many of its affiliates filed for bankruptcy in the United States, while other affiliates have entered insolvency, liquidation, or similar proceedings around the globe, following which the U.S. Department of Justice brought criminal fraud and other charges, and the SEC and CFTC brought civil securities and commodities fraud charges, against certain of FTX’s and its affiliates’ senior executives, including its former CEO. In addition, several other entities in the digital asset industry filed for bankruptcy following FTX’s bankruptcy filing, such as BlockFi Inc. and Genesis Global Capital, LLC.

“affiliate” - With respect to any Person, any other Person directly or indirectly controlling, controlled by or under common control with such Person.

“airdrop” - An occurrence where holders of a particular digital asset may be entitled to claim a certain amount of a new digital asset for free, based on the fact that they hold such particular digital asset.

“ASC” - The Financial Accounting Standards Board Accounting Standards Codification.

“ASC 820-10” - The Financial Accounting Standards Board Accounting Standards Codification Topic 820-10, “Fair Value Measurements and Disclosures.”

“Assumed Expenses” - The routine and ordinary administrative and operating expenses of the Trust including the fees of the Trustee, the Trust Administrator, Fund Accountant, Transfer Agent, the Custodians’ Fees, Listing Exchange fees, SEC registration fees, printing and mailing costs, tax reporting fees, audit fees, license fees and ordinary legal fees and expenses other than Extraordinary Expenses.

“Authorized Amount” - The aggregate U.S. dollar notional amount of Trade Credits that the Lender has agreed to extend to the Trust during any Defined Interval.

“Authorized Participant” - A person who, at the time of submitting an order to create or redeem one or more Baskets (i) is a registered broker-dealer; (ii) is a DTC Participant or an Indirect Participant; and (iii) has in effect a valid Authorized Participant Agreement.

“Authorized Participant Agreement” - An agreement entered into by an Authorized Participant, the Sponsor and the Trustee that provides the procedures for the creation and redemption of Baskets.

“Basket” - A block of 10,000 Shares.

“Basket Amount” - The quantity of Bitcoin attributable to each Share of the Trust (net of accrued but unpaid expenses and liabilities) multiplied by the number of Shares comprising a Basket.

“Bitcoin blockchain” - The blockchain ledger for Bitcoin.

“Bitcoin Custodian” or “Coinbase Custody” - Coinbase Custody Trust Company, LLC.

“Bitcoin Market Price” - The market price of Bitcoin as determined in accordance with ASC 820-10 on each Business Day.

“Bitcoin network” - Bitcoin blockchain and any digital asset network, including the Bitcoin peer-to-peer network.

“Bitcoin Trading Counterparty” - Designated third parties who are not registered broker-dealers and transact in Bitcoin pursuant to written agreements with the Trust.

“BitLicense” - A business license under 23 New York Codes, Rules and Regulations Part 200.

~~Indicate by check mark whether any of those~~“BRR” ~~error corrections are restatements that required a recovery analysis of incentive~~-~~based~~ ~~compensation~~The ~~received~~CME byCF ~~any~~Bitcoin ofReference ~~the registrant’s executive officers during the relevant recovery period pursuant to § 240~~Rate.~~10D-1(b). Yes ☐ No ☐~~

~~Indicate by check mark whether the~~“BRTI” ~~registrant is a shell company (as defined in Rule 12b~~-2 ofThe ~~the~~CME ~~Exchange~~CF ~~Act).~~Bitcoin ~~Yes~~Real ☐Time ~~No ☒~~Index.

~~Aggregate market value of registrant’s~~“BSA” ~~common stock held by non~~-~~affiliates~~ ofU.S. ~~the~~Bank ~~registrant,~~Secrecy ~~based upon the closing price of a share of the registrant’s common stock on June 30~~Act, ~~2022~~ as ~~reported by the OTC Markets, Inc~~amended. ~~on that date: $42,119,707.~~

~~Number~~“Business Day” of- ~~shares~~Any ofday ~~the~~other ~~registrant’s~~than: ~~common~~(1) ~~stock outstanding~~a asSaturday ofor ~~January~~a 5,Sunday; ~~2023:~~or ~~8,340,536~~(2) a day on which the Listing Exchange is closed for regular trading.

~~DOCUMENTS~~“Cash Custodian” ~~INCORPORATED~~- BYU.S. ~~REFERENCE:~~Bank ~~None~~National Association and any substitute or additional custodian of the Trust’s cash pursuant to a written agreement with the Trust or Trustee on behalf of the Trust.

“Cash Order Cutoff Time” - 5:30 p.m. ET on the Business Day prior to the trade date.

“CBDCs” - Digital forms of legal tender, called central bank digital currencies, introduced by central banks in various countries.

“CFPB” - The Consumer Financial Protection Bureau.

“CFTC” - The Commodity Futures Trading Commission.

“CME” - The Chicago Mercantile Exchange.

“Code” - The United States Internal Revenue Code of 1986, as amended.

“Coinbase Global” - The parent of the Bitcoin Custodian.

“Coinbase Insureds” - Coinbase Global and its subsidiaries.

“Commodity Exchange Act” - The Commodity Exchange Act of 1936, as amended.

“Connected Trading Venue” - A venue (including third-party venues and the Prime Execution Agent’s own execution venue) where the Prime Execution Agent executes orders to buy and sell Bitcoin on behalf of the Trust.

“Constituent Bitcoin Platforms” or “Constituent Platforms” - The major Bitcoin trading platforms that serve as the pricing sources for the calculation of the CME CF Bitcoin Reference Rate - New York Variant and CME CF Bitcoin Real Time Index.

“Custodial Services Agreement” - The Custodial Services Agreement, dated as of November 26, 2025, between Osprey Bitcoin Trust and Coinbase Custody Trust Company, LLC.

“Custodians” - The Cash Custodian and Bitcoin Custodian, collectively.

“Custodians’ Fees” - The fees payable to the Custodians.

“Covered Person” - Osprey Funds, LLC and its affiliates.

“Defined Interval” - A twenty-four-hour period starting at 6:00 a.m. ET (or such other time as may be notified by the Lender to the Trust from time to time) on any day that the Lender has extended Trade Credit to the Trust.

“DSTA” - Delaware Statutory Trust Act.

“DTC” - The Depository Trust Company.

“DTC Participant” - An entity that has an account with DTC.

“ECI” - Income that is treated as “effectively connected” with the conduct of a trade or business in the United States.

“ERISA” - The Employee Retirement Income Security Act of 1974, as amended.

“ET” - Eastern Time Zone.

~~TABLE~~“ETF” - OFExchange ~~CONTENTS~~traded fund.

Item No.	Item Caption	Page
	Statement Regarding Forward-Looking Statements	1
	Industry and Market Data	1
PART I
Item 1.	Business	2
Item 1A.	Risk Factors	29
Item 1B	Unresolved Staff Comments	61
Item 2.	Properties	61
Item 3.	Legal Proceedings	61
Item 4.	Mine Safety Disclosures	61
PART II
Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	62
Item 6.	[Reserved]	62
Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	62
Item 7A.	Quantitative and Qualitative Disclosures about Market Risk	67
Item 8.	Financial Statement and Supplementary Data	67
Item 9.	Changes in and Disagreements with Accountants on Accounting and Financial Disclosure	67
Item 9A.	Controls and Procedures	67
Item 9B.	Other Information	68
Item 9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections	68
PART III
Item 10.	Directors, Executive Officers and Corporate Governance	69
Item 11.	Executive Compensation	70
Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	70
Item 13.	Certain Relationships and Related Transactions and Director Independence	71
Item 14.	Principal Accounting Fees and Services	71
PART IV
Item 15.	Exhibits and Financial Statement Schedules	73
Item 16.	Form 10-K Summary	75

“ETP” - Exchange traded product.

“Event of Withdrawal” - The withdrawal, removal, adjudication or admission of bankruptcy or insolvency of the Sponsor, or an event of withdrawal.

“Exchange Act” - The Securities Exchange Act of 1934, as amended.

“Existing IRS Guidance” - The Notice, the Ruling & FAQs, and the Regulations, collectively.

“Extraordinary Expenses” - The extraordinary expenses of the Trust, including, but not limited to, taxes and governmental charges, expenses and costs, expenses and indemnities related to any extraordinary services performed by the Sponsor (or any other service provider, including the Trustee) on behalf of the Trust to protect the Trust or the interests of Shareholders, and indemnification expenses.

“FASB” - Financial Accounting Standards Board.

“FDAP” - A Non-U.S. Shareholder’s allocable share of U.S. source dividend, interest, rental and other “fixed or determinable annual or periodical gains, profits and income.”

“FDIC” - The Federal Deposit Insurance Corporation.

“FinCEN” - The U.S. Department of the Treasury Financial Crimes Enforcement Network.

“FINRA” - The Financial Industry Regulatory Authority.

“fork” - A non-backward compatible change to the original Bitcoin blockchain and the source code of the original Bitcoin network which results in the original Bitcoin network and the original Bitcoin blockchain existing side-by-side, but incompatible, with a new network and a new blockchain, and leads to the creation of a new asset running on the new blockchain.

“FTX” - FTX Trading Ltd.

“Fund Accountant” - U.S. Bancorp Fund Services, LLC (d/b/a U.S. Bank Global Fund Services).

“GAAP” - The U.S. generally accepted accounting principles.

“hard fork” - A permanent fork in a network’s blockchain that separates the network into a pre-fork digital asset and a new post-fork digital asset.

“IIV” - Intraday indicative value per share.

“Incidental Rights” - Any virtual currency (for avoidance of doubt, other than Bitcoin) or other asset or right that the Trust may be entitled to or come into possession of rights to acquire, or otherwise establish dominion and control over, any virtual currency or other asset or right, which rights are incident to the Trust’s ownership of Bitcoin and arise without any action of the Trust, or of the Sponsor or Trustee on behalf of the Trust. In the event of a hard fork of the Bitcoin blockchain, the Sponsor shall determine which network shall constitute the Bitcoin network and which asset shall constitute Bitcoin in accordance with the Trust Agreement.

“Index” - CME CF Bitcoin Reference Rate - New York Variant.

“Index Administrator” - CF Benchmarks Ltd.

“Indirect Participant” - An entity that has access to the DTC clearing system by clearing securities through, or maintaining a custodial relationship with, a DTC Participant.

“In-Kind Order Cutoff Time” - 3:59 p.m. ET on the trade date.

“Investment Company Act” - The Investment Company Act of 1940, as amended.

“IR Virtual Currency” - A virtual currency acquired through Incidental Rights.

iii

~~STATEMENT~~“IRA” - ~~REGARDING~~Individual ~~FORWARD-LOOKING STATEMENTS~~retirement account.

~~This Annual Report on Form 10-K (the~~ “~~Annual Report~~IRS”~~) contains “forward-looking statements” within the meaning of Section~~ 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which are subject to the safe harbor created by such sections. Statements preceded by, followed by or that include words such as “may,” “might,” “will,” “should,” “expect,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or “continue,” the negative of these terms and other similar expressions are intended to identify some of the forward-~~looking~~ ~~statements.~~The ~~All~~United ~~statements~~States ~~(other~~Internal ~~than~~Revenue statements of historical fact) included in this Annual Report that address activities, events or developments that will or may occur in the future, including such matters as changes in market prices and conditions, the Osprey Bitcoin Trust’s (the “Trust”) operations, the plans of Osprey Funds, LLC (the “Sponsor”) and references to the Trust’s future success and other similar matters are forward-looking statementsService. These statements are only predictions. Actual events or results may differ materially from such statements. These statements are based upon certain assumptions and analyses the Sponsor made based on its perception of historical trends, current conditions and expected future developments, as well as other factors appropriate in the circumstances. You should specifically consider the numerous risks outlined under “Risk Factors.” Whether or not actual results and developments will conform to the Sponsor’s expectations and predictions, however, is subject to a number of risks and uncertainties, including:

●“JOBS Act” ~~the legal challenges associated with conducting an ongoing redemption program and our plans to begin considering a limited periodic redemption program or an open~~-~~ended~~ ~~redemption~~The ~~program;~~Jumpstart ●Our ~~the~~Business ~~economic~~Startups conditions in the Bitcoin industry and market, including any prolonged substantial reduction in Bitcoin prices and the impact of the failure of several prominent crypto trading venues and lending platforms on the crypto economy; ● general economic, market and business conditions; ● the use of technology by us and our vendors, including the Custodian (as defined herein), in conducting our business, including disruptions in our computer systems and data centers and our transition to, and quality of, new technology platforms; ● changes in laws or regulations, including those concerning taxes, made by governmental authorities or regulatory bodies; ● the costs and effect of any litigation or regulatory investigations; ● our ability to maintain a positive reputation; and ● other world economic and political developments, such as the ongoing conflict in UkraineAct.

Consequently, all the forward-looking statements made in this Annual Report are qualified by these cautionary statements, and there can be no assurance that the actual results or developments the Sponsor anticipates will be realized or, even if substantially realized, that they will result in the expected consequences to, or have the expected effects on, the Trust’s operations or the value of the Units. Should one or more of the risks discussed under “~~Item 1A. Risk Factors~~KYC” ~~in this Annual Report or other~~ ~~uncertainties materialize, or should underlying assumptions prove incorrect, actual outcomes may vary materially from those described in forward~~-~~looking~~ ~~statements.~~Know ~~Forward-looking~~your statements are made based on the Sponsor’s beliefs, estimates and opinions on the date the statements are made and neither the Trust nor the Sponsor is under a duty or undertakes an obligation to update forward-looking statements if these beliefs, estimates and opinions or other circumstances should change, other than as required by applicable lawscustomer. ~~Moreover, neither the Trust, the Sponsor, nor any other person assumes responsibility for the accuracy and completeness of any of these forward-looking statements.~~

~~INDUSTRY~~“Listing Exchange” ~~AND~~- ~~MARKET~~Nasdaq ~~DATA~~Stock Market LLC.

~~Although~~“Management weFee” ~~are responsible for all disclosure contained in this Annual Report on Form 10~~-K, inThe ~~some~~fees ~~cases~~of wethe ~~have~~Sponsor ~~relied~~are onaccrued ~~certain~~daily ~~market~~ and ~~industry~~is ~~data~~payable ~~obtained~~monthly ~~from~~in ~~third-party~~arrears ~~sources~~in ~~that we believe to be reliable~~U.S. ~~Market~~dollars ~~estimates~~only, and are calculated by ~~using~~the ~~independent~~Trust ~~industry~~Administrator. ~~publications~~The inTrust ~~conjunction~~Administrator ~~with~~calculates ~~our assumptions regarding~~ the ~~Bitcoin~~Management ~~industry~~Fee ~~and~~on ~~market.~~a ~~While~~daily webasis ~~are~~by ~~not~~applying ~~aware~~the ~~of any~~0.49% ~~misstatements~~annualized ~~regarding~~rate ~~any~~to ~~market,~~the ~~industry or similar data presented herein~~Trust’s NAV, ~~such~~as ~~data~~determined ~~involves~~by ~~risks~~reference ~~and uncertainties and is subject~~ to ~~change based on various factors, including those discussed under~~ the ~~headings “Statement Regarding Forward-Looking Statements” and “Item 1A~~Index. ~~Risk Factors” in this Annual Report.~~

~~Unless otherwise stated or~~“Marketing ~~the~~Agent” ~~context~~- ~~otherwise~~Foreside ~~requires,~~Fund ~~the terms “we~~Services,” ~~“our” and “us” in this Annual Report refer to the Sponsor acting on behalf of the Trust~~LLC.

1“Money Market Fund” - A money market fund that is in compliance with Rule 2a-7 under the Investment Company Act and rated “AAA” by S&P (or the equivalent from any eligible rating service).

“NAV” - Net asset value of the Trust.

“NAV per Share” - The NAV divided by the number of outstanding Shares.

“Non-ERISA Arrangements” - Plans not subject to ERISA and/or Section 4975 of the Code, such as governmental plans, non-U.S. plans and certain church plans.

“Non-U.S. Shareholder” - A Shareholder that is (or is treated as), for U.S. federal income tax purposes: (1) a non-resident alien individual; (2) a foreign corporation; or (3) an estate or trust whose income is not subject to U.S. federal income tax on a net income basis.

“Notice” - The 2014 notice released by the IRS.

“November 2020 Offering” - The Trust’s offering of an unlimited number of Shares on November 12, 2020 pursuant to Rule 506(c) under the Securities Act.

“NYDFS” - The New York State Department of Financial Services.

“OCC” - The Office of the Comptroller of the Currency.

“OFAC” - The Office of Foreign Assets Control.

“OTCQX” - OTC Markets Group, Inc.’s OTCQX® Best Marketplace.

“Person” - Any natural person or any limited liability company, corporation, partnership, joint venture, association, joint stock company, trust, unincorporated organization or government or any agency or political subdivision thereof.

“Plan Asset Regulations” - The U.S. Department of Labor’s regulations in Section 2510.3-101, as amended by Section 3(42) of ERISA.

“Plans” - Any (a) employee benefit plan and certain other plans and arrangements, including IRAs and annuities and Keogh plans; and (b) certain collective investment funds or insurance company general or separate accounts in which such plans or arrangements are invested, that are subject to Title I of ERISA and/or Section 4975 of the Code.

“Prime Execution Agent” - Coinbase, Inc.

“Prime Execution Agreement” - The Prime Broker Agreement dated as of November 26, 2025, by and between the Trust and the Prime Execution Agent.

“Regular Market Session” - The Listing Exchange’s regular market session of 9:30 a.m. to 4:00 p.m. ET.

“Regulations” - The IRS and Treasury Department’s regulations addressing information reporting of digital assets.

“Relevant Pair” - The relevant cryptocurrency base asset against the corresponding quote asset, including markets where the quote asset is made fungible with accepted assets.

“REX Financial” - REX Financial, LLC, an affiliate of the Sponsor.

“Rule 504 Offering” - An offering pursuant to Rule 504 of Regulation D under the Securities Act.

“Ruling & FAQs” - The revenue ruling and set of “Frequently Asked Questions” released by the IRS in 2019.

“Sarbanes-Oxley Act” - The Sarbanes-Oxley Act of 2002.

“satoshi” - Fractions of a Bitcoin smaller than .00000001.

“SEC” - The U.S. Securities and Exchange Commission, or any successor governmental agency in the United States.

“Securities Act” - The Securities Act of 1933, as amended.

“Settlement Deadline” - 6:00 p.m. ET on the calendar day immediately following the start of a Defined Interval.

“Shareholders” - Owners of beneficial interests in the Shares.

“Shares” - Units of fractional undivided beneficial interest in the net assets of the Trust.

“Similar Laws” - Federal, state, local, non-U.S. or other laws similar to ERISA and/or Section 4975 of the Code.

“SIPC” - The Securities Investor Protection Corporation.

“Sponsor” - Osprey Funds, LLC.

“Trade Credit” - The Trust may borrow Bitcoin or cash as a credit on a short-term basis from the Lender pursuant to the Trade Financing Agreement.

“Lender” - Coinbase Credit, Inc.

“Trade Finance Debit Account” - A ledger entry for purposes of tracking Trade Credits extended by the Lender.

“Trade Financing Agreement” - The Credit Committed Trade Financing Agreement, dated as of November 26, 2025, by and between the Trust and the Lender.

“Trading Account” - A trading account at which, pursuant to the Prime Execution Agreement, the Trust’s Bitcoin holdings and cash holdings from time to time may be held with the Prime Execution Agent, in connection with the sale of Bitcoin to pay the Management Fee and Trust expenses not assumed by the Sponsor.

“Trading Platform” - The Prime Execution Agent’s execution platform where the Sponsor may place an order.

“Transfer Agent” - U.S. Bancorp Fund Services, LLC (d/b/a U.S. Bank Global Fund Services).

“Treasury Regulations” - Tax regulations issued by the IRS.

“Trust” - Osprey Bitcoin Trust, a Delaware statutory trust formed pursuant to the Trust Agreement.

“Trust Administrator” - U.S. Bancorp Fund Services, LLC (d/b/a U.S. Bank Global Fund Services).

“Trust Agreement” - The Trust is governed by the provisions of the Trust Agreement, dated as of November 1, 2020, as amended on April 15, 2022, January 18, 2024, December 18, 2025, and January 9, 2026.

“Trust Documents” - The Trust Agreement and the Trust’s agreement with its service providers.

“Trustee” - CSC Delaware Trust Company.

“UBTI” - Unrelated business taxable income.

“UK FCA” - UK Financial Conduct Authority.

“U.S. Bank Global Fund Services” - U.S. Bancorp Fund Services, LLC (d/b/a U.S. Bank Global Fund Services), the Transfer Agent, Trust Administrator and Fund Accountant.

“USDC” - U.S. Dollar Coin.

“U.S. Shareholder” - A Shareholder that is (1) an individual who is treated as a citizen or resident of the United States for U.S. federal income tax purposes; (2) a corporation (or an entity treated as a corporation for U.S. federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of Columbia; (3) an estate, the income of which is includible in gross income for U.S. federal income tax purposes regardless of its source; or (4) a trust, if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more U.S. persons have the authority to control all substantial decisions of the trust.

“U.S. Treasury Department” - U.S. Department of the Treasury.

“Vault Account” - Accounts storing the Trust’s Bitcoin that are required to be segregated from the assets held by the Bitcoin Custodian as principal and the assets of its other customers.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Annual Report on Form 10-K contains “forward-looking statements” with respect to the financial conditions, results of operations, plans, objectives, future performance and business of the Trust. In some cases, you can identify forward-looking statements by terminology such as “may,” “will,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “potential” or the negative of these terms or other comparable terminology. All statements (other than statements of historical fact) included in this Annual Report that address activities, events or developments that will or may occur in the future, including such matters as movements in the cryptocurrencies markets and indexes that track such movements, the Trust’s operations, the Sponsor’s plans and references to the Trust’s future success and other similar matters, are forward-looking statements. These statements are only predictions. Actual events or results may differ materially. These statements are based upon certain assumptions and analyses the Sponsor has made based on its perception of historical trends, current conditions and expected future developments, as well as other factors appropriate in the circumstances. Whether or not actual results and developments will conform to the Sponsor’s expectations and predictions, however, is subject to a number of risks and uncertainties, including the special considerations discussed in this Annual Report, general economic, market and business conditions, changes in laws or regulations, including those concerning taxes, made by governmental authorities or regulatory bodies, and other world economic and political developments. Consequently, all the forward-looking statements made in this Annual Report are qualified by these cautionary statements, and there can be no assurance that actual results or developments the Sponsor anticipates will be realized or, even if substantially realized, that they will result in the expected consequences to, or have the expected effects on, the Trust’s operations or the value of its Shares.

Unless otherwise stated or the context otherwise requires, the terms “we,” “our” and “us” in this Annual Report refer to the Trust.

PART I

~~Item~~ ITEM 1. ~~Business~~BUSINESS

~~Trust Overview~~Summary

Osprey Bitcoin Trust (the “Trust”) is aan ~~Delaware~~exchange-traded ~~Statutory~~fund ~~Trust~~ that ~~was~~issues ~~formed~~shares of beneficial interest (“Shares”) that are listed on ~~January~~The 3,Nasdaq ~~2019~~Stock byMarket LLC (the ~~filing~~“Listing ofExchange”) and which began trading under the ~~Certificate~~ticker symbol “OBTC” on December 19, 2025. The investment objective of the Trust ~~with~~is for the ~~Delaware~~Shares ~~Secretary~~to reflect the performance of ~~State~~Bitcoin inas ~~accordance~~measured ~~with~~by reference to the ~~provisions~~CME ofCF ~~the~~Bitcoin ~~Delaware~~Reference ~~Statutory~~Rate ~~Trust~~- ~~Act~~New York Variant (the “~~DSTA~~Index”), less the Trust’s expenses and other liabilities. ~~The~~Each ~~Trust~~Share ~~operates~~represents ~~pursuant~~a tofractional ~~the~~undivided ~~Second~~beneficial ~~Amended~~interest ~~and~~in ~~Restated~~the ~~Declaration~~net assets of the Trust. ~~and~~The ~~Trust~~assets ~~Agreement~~of (the “Trust ~~Agreement”~~consist primarily of Bitcoin held by the Bitcoin Custodian (as defined below) on behalf of the Trust.

The Trust’s ~~purpose~~was isformed toas ~~hold~~a ~~Bitcoin~~Delaware statutory trust on January 3, ~~which~~2019, ~~are~~pursuant ~~digital~~to ~~assets~~the ~~that~~Delaware ~~are~~Statutory ~~created~~Trust ~~and~~Act. ~~transmitted~~The ~~through~~Trust is governed by the ~~operations~~provisions of the ~~peer-to-peer~~ ~~Bitcoin~~Trust ~~Network~~Agreement, adated ~~decentralized~~as ~~network~~ of ~~computers~~November ~~that~~1, ~~operates~~2020, as amended on ~~cryptographic~~April ~~protocols.~~15, ~~The~~2022, ~~Trust~~January ~~issues~~18, ~~common~~2024, December 18, ~~units~~2025, ofand ~~fractional~~January ~~undivided~~9, ~~beneficial~~2026. ~~interest~~Osprey Funds, LLC (the “~~Units~~Sponsor”), ~~which~~is ~~represent~~the ~~ownership~~sponsor inof the Trust,; onCSC anDelaware ~~ongoing~~Trust Company (the ~~basis,~~“Trustee”) ~~but~~is ~~only~~the totrustee anof ~~accredited~~the ~~investor~~Trust; Coinbase Custody Trust Company, LLC (the “~~Accredited~~Bitcoin ~~Investor~~Custodian”) ~~(as~~is ~~defined~~the custodian infor ~~Rule~~the ~~501~~Trust’s ~~under~~Bitcoin ~~the~~holdings; ~~Securities~~and ~~Act)~~U.S. Bank National Association (the “Cash Custodian” and, together ~~The~~with ~~Units~~the ~~are~~Bitcoin ~~quoted~~Custodian, onthe ~~OTC~~“Custodians”) ~~Markets~~is ~~Group~~the ~~Inc.~~custodian for the Trust’s ~~OTCQX®~~cash ~~Best~~holdings ~~Marketplace~~and U.S. Bancorp Fund Services, LLC (d/b/a U.S. Bank Global Fund Services) (the “~~OTCQX~~Trust Administrator” and the “Transfer Agent”) ~~under~~is the administrator of, and the ~~ticker~~transfer ~~symbol~~agent for, the Trust. Continental Stock Transfer & Trust Company serves as the sub-transfer ~~“OBTC~~agent of the Trust.”

~~Osprey~~Prior ~~Funds,~~to ~~LLC~~listing is the ~~sponsor~~Shares offor ~~the~~trading ~~Trust,~~on ~~Delaware Trust Company is~~ the ~~trustee~~Listing ofExchange, the Trust ~~(the~~issued ~~“Trustee”),~~Shares ~~Continental Stock~~pursuant ~~Transfer &~~to ~~Trust~~Regulation ~~Company~~D isunder the ~~transfer~~Securities ~~agent of the Trust (in such capacity, the “Transfer Agent”),~~Act. ~~Theorem~~The ~~Fund~~Shares ~~Services~~were isquoted ~~the~~on ~~administrator~~OTC ofMarkets ~~the Trust (in such capacity, the “Administrator”),~~ and ~~Coinbase~~OTC ~~Custody Trust~~Markets ~~Company~~Group, ~~LLC (the “Custodian” or “Coinbase Custody”) is the digital asset custodian of the Trust~~Inc. ~~Fidelity~~’s ~~Digital~~OTCQX® ~~Assets~~Best ~~Services,~~Marketplace ~~LLC~~ (“~~FDAS~~OTCQX”) ~~served~~under ~~as our digital asset custodian until April 10, 2022. On February~~the 4,ticker ~~2022,~~symbol ~~the Trust entered into a custodial services agreement (the~~ “~~Custodial Services Agreement~~OBTC.”) ~~with~~The ~~Coinbase Custody. On March 11, 2022, the~~ Trust’s ~~delivered~~Shares towere ~~FDAS~~quoted aon ~~notice~~OTC ofMarkets ~~termination~~since ofFebruary ~~its custodial services agreement~~12, ~~dated May 18~~2021, ~~2020. On~~and ~~March~~on ~~10,~~OTCQX ~~2022,~~under the ~~Trust transferred its custodied digital assets from FDAS to Coinbase Custody. The notice of termination~~ ~~became~~symbol ~~effective~~OBTC onsince ~~April~~February 1026, ~~2022~~2021.

The fiscal year of the Trust is ~~authorized~~the ~~under~~calendar year and the Trust ~~Agreement~~has tono ~~create~~fixed ~~and~~termination ~~issue~~date. anThe ~~unlimited~~Sponsor ~~number~~may ofselect ~~Units~~an alternate fiscal year. The Trust ~~issues~~does ~~Units~~not ~~only~~have ~~in connection~~any ~~with~~directors, ~~purchase~~officers ~~orders~~or ~~for~~employees. aThe ~~minimum~~Trust ofis ~~$25,000.00~~managed ~~for~~by ~~initial~~the ~~investments~~Sponsor and ~~$10,000.00~~pays ~~for~~the ~~subsequent~~Sponsor ~~investments~~a management fee (the “Management Fee”).

~~Due~~The toTrust ~~the~~is ~~lack~~not ofregistered ~~an ongoing redemption program~~ as ~~well~~an asinvestment ~~price~~company ~~volatility,~~under ~~low~~the ~~trading~~1940 ~~volume~~Act and ~~closings~~the ofSponsor ~~Bitcoin~~is ~~exchanges due~~not toregistered ~~fraud,~~as ~~failure,~~an ~~security~~investment ~~breaches~~adviser orunder the ~~otherwise,~~Investment ~~there~~Advisers ~~can~~Act beof no1940. ~~assurance~~The ~~that~~Trust ~~the~~does ~~market~~not ~~value~~hold ofor ~~the~~trade ~~Units~~in ~~will~~commodity ~~reflect the~~futures ~~per~~contracts ~~Unit~~regulated ~~value~~by of the ~~Trust’s Bitcoin~~CEA, ~~less~~as ~~the Trust’s expenses and other liabilities (“NAV per Unit”),~~administered ~~and~~by the ~~Units~~CFTC. ~~may~~The ~~trade~~Trust atis not a ~~substantial~~commodity ~~premium~~pool ~~over,~~for orpurposes aof ~~substantial discount to,~~ the ~~NAV~~CEA ~~per~~and ~~Unit. The Units are~~ neither ~~interests in nor obligations of~~ the Sponsor, ornor the Trustee. ~~The~~is ~~Trust~~subject ~~has from time~~ to ~~time~~regulation as ~~halted~~a ~~creations~~commodity ofpool ~~new~~operator ~~Units,~~or ~~and~~a ~~most~~commodity ~~recently did~~trading soadviser onin ~~November~~connection 1,with ~~2021 when~~ the ~~Trust suspended the November 2020 Offering (as defined herein)~~Shares.

~~Although~~The ~~the~~number ~~redemption~~ of ~~Units~~outstanding Shares is ~~provided~~expected ~~for~~to inincrease ~~the~~and ~~Trust~~decrease ~~Agreement,~~from ~~Units~~time ~~may~~to ~~not~~time beas ~~redeemed~~a ~~from~~result of the ~~Trust~~creation ~~currently.~~and ~~The~~redemption ~~current~~of Baskets. ~~legal~~The ~~framework~~Trust ~~has~~issues ~~made~~and itredeems ~~difficult~~Shares ~~for~~only ~~the~~in ~~Trust~~Baskets, tobased ~~permit~~on ~~redemptions~~the quantity of ~~our~~Bitcoin ~~Units~~attributable ~~because~~to weeach ~~are~~Share ~~unable~~(net toof ~~conduct~~any ~~concurrent~~accrued ~~offerings~~but ~~and~~unpaid ~~redemptions~~Management ofFees, ~~our~~expenses ~~Units~~and liabilities). AsBaskets ofmay ~~the~~be ~~date~~redeemed ofby ~~this filing,~~ the Trust ~~has~~in ~~not~~exchange ~~accepted new purchases~~ for ~~over~~the ~~one~~amount ~~year, and we have no present intention~~ of ~~reopening~~Bitcoin ~~sales~~corresponding to oftheir ~~Units. We are considering a~~ redemption ~~program~~value ~~for~~or ~~investors in~~ the ~~Trust. Any~~cash ~~redemption~~proceeds ~~program~~from ~~would~~selling ~~likely~~the ~~involve~~amount ~~limited periodic redemptions~~ of ~~Units,~~Bitcoin ~~although~~corresponding weto ~~have~~their ~~not ruled out the possibility of an open-ended~~ redemption ~~program~~value.

~~The~~Further ~~Trust~~information ~~determines~~about the ~~current~~Trust ~~value~~or ofthe ~~Bitcoin~~Shares bycan ~~reference~~be toobtained from the ~~market~~website ~~price~~at ofhttps://www.rexshares.com/OBTC. ~~Bitcoin~~Our asannual ~~listed~~reports on ~~Coinbase Pro~~Form 10-K, aquarterly ~~digital asset~~reports ~~exchange~~on ~~for~~Form ~~the~~10-Q ~~buying~~ and ~~selling~~current ofreports ~~cryptocurrency~~on ~~and~~Form ~~the~~8-K ~~Trust’s~~(including ~~principal~~any ~~digital~~amendments ~~asset~~thereto) ~~market~~filed with, asor ~~determined~~furnished to, atthe ~~4:00~~Securities ~~p.m.~~and Exchange Commission (the “SEC”), ~~New~~are ~~York~~made ~~time~~available, onfree ~~each~~of ~~day~~charge, ~~the~~at ~~New~~that ~~York~~website ~~Stock~~as ~~Exchange~~soon isas ~~open~~reasonably practicable ~~for~~after ~~trading~~such ~~(each,~~documents aare ~~“Business~~so ~~Day”)~~filed (or furnished. Additional information regarding the ~~“Bitcoin~~ ~~Market~~Trust ~~Price”).~~may ~~The~~also ~~Bitcoin~~be ~~Market~~found ~~Price~~on isthe ~~available~~SEC’s EDGAR database at ~~https://pro~~www.~~coinbase~~sec.~~com/trade/BTC-USD~~gov.

The ~~Trust~~contents ~~uses~~of the ~~Bitcoin~~websites ~~Market~~referred ~~Price~~ to ~~calculate~~above ~~its~~and ~~“Bitcoin~~any ~~Holdings,”~~websites ~~which~~referred isto ~~the~~herein ~~aggregate~~are ~~value,~~not ~~expressed~~incorporated ~~in U.S.~~into ~~dollars,~~this ~~of the Trust’s assets (other than U~~filing.S. ~~dollars~~Further, ~~other~~any ~~fiat currency and Additional Currency (as that term is~~reference ~~defined~~to ~~herein)), less~~ the ~~U.S.~~URLs ~~dollar value~~ of ~~the~~a ~~Trust’s~~website expenses and other liabilities calculated in the manner set forth below under the section “Valuation of Bitcoin and Determination of the Trust’s Bitcoin Holdings.” The per Unit value of the Trust’s Bitcoin Holdings (the “Bitcoin Holdings per Unit”) is ~~calculated~~intended byto ~~dividing~~be ~~Bitcoin~~inactive ~~Holdings by~~textual ~~the~~references ~~number of Units currently outstanding~~only.

~~Bitcoin pricing information is available on a 24-hour basis from various financial information service providers or Bitcoin Network information sites such as Tradeblock.com or Bitcoincharts.com.~~ The ~~spot price and bid/ask spreads may also be available directly from various~~ Bitcoin exchanges. Market prices for the Units will be available from a variety of sources, including brokerage firms, information websites and other information service providers. In addition, on each Business Day the Trust’s ~~website~~Investment ~~will~~Objective ~~provide~~and ~~pricing information for the Units based on the Bitcoin Market Price.~~Strategies

The investment objective of the Trust, which is a passive investment vehicle, is for the Shares to reflect the performance of Bitcoin as measured by reference to the Index, less the Trust’s expenses and other liabilities. Historically, the Trust measured the performance of Bitcoin by reference to the CMBI Bitcoin Index. Upon effectiveness of the Trust’s registration statement on Form S-1, as amended (File No. 333-289334), effective as of December 18, 2025, the performance of Bitcoin was measured by reference to the Index. Prior to trading on the Listing Exchange, the Shares were quoted on OTC Markets since February 12, 2021, and on OTCQX under the symbol “OBTC” since February 26, 2021, and did not meet their investment objective. Since trading on the Listing Exchange, the Shares have met their investment objective.

While an investment in the Shares is not a direct investment in Bitcoin, the Shares are intended to constitute a cost-effective and convenient means of gaining investment exposure to Bitcoin. The logistics of accepting, transferring and safekeeping of Bitcoin are dealt with by the Sponsor and the Bitcoin Custodian, and the related expenses are built into the price of the Shares. Therefore, Shareholders do not have additional tasks or costs over and above those generally associated with investing in any other publicly listed security. However, an investment in the Shares may operate and perform differently over time, or at any specific point in time, than an investment directly in Bitcoin due to such factors as Trust fees and expenses, the quantity of Shares available for trading, the relative liquidity of the Shares and differences in the markets trading Bitcoin and Shares (e.g., hours of operation, marketplace rules, clearance and settlement and market participants).

The Index is an independently calculated value based on an aggregation of executed trade flow of major Bitcoin spot platforms. The administrator of the Index is CF Benchmarks Ltd. (the “Index Administrator”). The Index currently uses substantially the same methodology as the CME CF Bitcoin Reference Rate (“BRR”), including utilizing the same eight Bitcoin platforms, which is the underlying rate to determine settlement of CME Bitcoin futures contracts, except that the Index is calculated as of 4:00 p.m. New York time, whereas the BRR is calculated as of 4:00 p.m. London time. There can be no assurance that the Trust will achieve its investment objective.

The Sponsor believes that the use of the Index is reflective of a reasonable valuation of the average spot price of Bitcoin and that resistance to manipulation is a priority aim of its design methodology. The methodology: (i) takes an observation period and divides it into equal partitions of time; (ii) then calculates the volume-weighted median of all transactions within each partition; and (iii) the value is determined from the equally weighted average of the volume-weighted medians. By employing the foregoing steps, the Index thereby seeks to ensure that transactions in Bitcoin conducted at outlying prices do not have an undue effect on the value of a specific partition, large trades or clusters of trades transacted over a short period of time will not have an undue influence on the index level, and the effect of large trades at prices that deviate from the prevailing price are mitigated from having an undue influence on the benchmark level. In addition, the Sponsor notes that an oversight function is implemented by the Index Administrator in seeking to ensure that the Index is administered through codified policies for Index integrity.

Bitcoin, Bitcoin Market, Bitcoin Platforms and Regulation of Bitcoin

Bitcoin

Bitcoin is a digital asset that is created and transmitted through the operations of the peer-to-peer Bitcoin network, a decentralized network of computers that operates on cryptographic protocols. No single entity owns or operates the Bitcoin network, the infrastructure of which is collectively maintained by its user base. The Bitcoin network allows people to exchange tokens of value, called Bitcoin, which are recorded on a public transaction ledger (the “Bitcoin blockchain”). Bitcoin can be used to pay for goods and services, or it can be converted to fiat currencies, such as the U.S. dollar, at rates determined on Bitcoin platforms that enable trading in Bitcoin or in individual end-user-to-end-user transactions under a barter system.

The Bitcoin network is commonly understood to be decentralized and does not require governmental authorities or financial institution intermediaries to create, transmit or determine the value of Bitcoin. Rather, Bitcoin is created and allocated by the Bitcoin network protocol through a “mining” process. The value of Bitcoin is determined by the supply of and demand for Bitcoin-on-Bitcoin platforms or in private end-user-to-end-user transactions.

New Bitcoin are created and rewarded to the miners of a block in the Bitcoin blockchain for verifying transactions. The Bitcoin blockchain is a shared database that includes all blocks that have been solved by miners and it is updated to include new blocks as they are solved. Each Bitcoin transaction is broadcast to the Bitcoin network and, when included in a block, recorded in the Bitcoin blockchain. As each new block records outstanding Bitcoin transactions, and outstanding transactions are settled and validated through such recording, the Bitcoin blockchain represents a complete, transparent and unbroken history of all transactions of the Bitcoin network.

History of Bitcoin

The Bitcoin network was initially contemplated in a white paper that also described Bitcoin and the operating software to govern the Bitcoin network. The white paper was purportedly authored by Satoshi Nakamoto. However, no individual with that name has been reliably identified as Bitcoin’s creator, and the general consensus is that the name is a pseudonym for the actual inventor or inventors. The first Bitcoin was created in 2009 after Nakamoto released the Bitcoin network source code (the software and protocol that created and launched the Bitcoin network). The Bitcoin network has been under active development since that time by a loose group of software developers who have come to be known as core developers.

~~The~~Overview ~~Trust is not registered as an investment company under the Investment Company Act~~ of ~~1940~~Bitcoin ~~(“Investment~~Network Company Act”) and the Sponsor believes that the Trust is not required to register under the Investment Company Act. The Trust will not hold or trade in commodity futures contracts or other derivative contracts regulated by the Commodity Exchange Act (“CEA”), as administered by the Commodity Futures Trading Commission (“CFTC”). The Sponsor believes that the Trust is not a commodity pool for purposes of the CEA, and that neither the Sponsor nor the Trustee is subject to regulation as a commodity pool operator or a commodity trading adviser in connection with the operation of the Trust.Operations

In order to own, transfer or use Bitcoin directly on the Bitcoin network (as opposed to through an intermediary, such as a platform), a person generally must have internet access to connect to the Bitcoin network. Bitcoin transactions may be made directly between end-users without the need for a third-party intermediary. To prevent the possibility of double-spending Bitcoin, a user must notify the Bitcoin network of the transaction by broadcasting the transaction data to its network peers. The Bitcoin network provides confirmation against ~~Trust~~double-spending ~~has~~by nomemorializing ~~fixed~~every ~~termination~~transaction ~~date~~in the Bitcoin blockchain, which is publicly accessible and transparent. This memorialization and verification against double-spending is accomplished through the Bitcoin network mining process, which adds “blocks” of data, including recent transaction information, to the Bitcoin blockchain.

~~The~~Overview Sponsor maintains an Internet website at www.ospreyfunds.io, through which the registrant annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of ~~the~~Bitcoin Securities Exchange Act of 1934, as amended (the “Exchange Act”), are made available free of charge after they have been filed or furnished to the SEC. Additional information regarding the Trust may also be found on the SEC’s EDGAR database at www.sec.gov.Transfers

~~Trust~~Prior to ~~Objective~~engaging in Bitcoin transactions directly on the Bitcoin network, a user generally must first install on its computer or mobile device a Bitcoin network software program that will allow the user to generate a private and ~~Key~~public ~~Operating~~key pair associated with a Bitcoin address ~~Metrics~~commonly referred to as a “wallet.” The Bitcoin network software program and the Bitcoin address also enable the user to connect to the Bitcoin network and transfer Bitcoin to, and receive Bitcoin from, other users.

~~The~~Each ~~investment~~Bitcoin ~~objective~~network ofaddress, ~~the~~or ~~Trust~~wallet, ~~which~~ is associated with a ~~passive~~unique ~~investment~~“public ~~vehicle,~~key” isand ~~for~~“private key” pair. To receive Bitcoin, the ~~Units~~Bitcoin recipient must provide its public key to ~~reflect~~the party initiating the ~~performance~~transfer. ofThis ~~Bitcoin~~activity is analogous to a recipient asfor ~~measured~~a bytransaction ~~reference~~in toU.S. ~~Coin~~dollars ~~Metrics~~providing ~~CMBI~~a ~~Bitcoin~~routing ~~Index~~address (in wire instructions to the ~~“Index”)~~payor ~~provided~~so bythat ~~Coin~~cash ~~Metrics~~may ~~Inc.~~be (wired to the ~~“Index~~recipient’s ~~Provider”),~~account. ~~less~~The ~~the~~payor ~~Aggregate~~approves ~~Trust~~the ~~Expenses~~transfer ~~(defined~~to ~~below)~~the ~~and~~address ~~other~~provided ~~liabilities.~~by ~~The~~the ~~Units~~recipient ~~have~~by ~~been~~“signing” ~~quoted~~a ontransaction ~~OTC~~that ~~Markets~~consists ~~since~~of ~~February~~the ~~12,~~recipient’s ~~2021,~~public ~~and~~key onwith ~~OTCQX~~the ~~under~~private key of the ~~symbol~~address ~~“OBTC”~~from ~~since~~where ~~February~~the ~~26,~~payor ~~2021~~is transferring the Bitcoin. The recipient, however, ~~and~~does not make public or provide to ~~date~~the ~~have~~sender ~~not~~its ~~met~~related ~~their investment~~private ~~objective~~key.

~~While~~Neither anthe ~~investment~~recipient innor the ~~Units~~sender isreveals ~~not~~their aprivate ~~direct~~keys ~~investment~~ in ~~Bitcoin,~~a ~~the~~transaction ~~Units~~because ~~are~~the ~~intended~~private tokey ~~constitute~~authorizes atransfer ~~cost-effective and convenient means~~ of ~~gaining~~the ~~investment~~funds ~~exposure~~in that address to ~~Bitcoin~~other users. ~~The logistics of accepting~~Therefore, ~~transferring~~if ~~and~~a ~~safekeeping~~user ofloses ~~Bitcoin~~his ~~are~~private ~~dealt with by the Sponsor and the Custodian~~key, ~~and~~ the ~~related~~user ~~expenses~~may ~~are~~permanently ~~built~~lose ~~into~~access to the ~~price~~Bitcoin ofcontained in the ~~Units~~associated address. ~~Therefore~~Likewise, ~~Unitholders~~Bitcoin ~~do not~~is ~~have~~irretrievably ~~additional~~lost ~~tasks~~if orthe ~~costs~~private ~~over~~key ~~and above those generally~~ associated with ~~investing~~them inis ~~any~~deleted ~~other~~and ~~privately~~no ~~placed~~backup ~~security.~~has ~~However,~~been anmade. ~~investment~~When insending ~~the Units may operate and perform differently over time~~Bitcoin, ora atuser’s ~~any specific point in time, than an investment directly in~~ Bitcoin ~~due~~network tosoftware ~~such~~program ~~factors~~must asvalidate ~~Trust~~the ~~fees~~transaction ~~and~~with ~~expenses,~~ the ~~quantity~~associated ofprivate key. ~~Units~~The ~~available~~resulting ~~for~~digitally ~~trading,~~validated ~~the~~transaction ~~relative~~is ~~liquidity of~~sent ~~the~~by ~~Units and differences in~~ the ~~markets~~user’s ~~trading~~ Bitcoin ~~and~~network ~~Units~~software ~~(e.g.,~~program ~~hours~~to ofthe ~~operation,~~Bitcoin ~~marketplace rules, clearance and~~network ~~settlement~~to ~~and~~allow ~~market~~transaction ~~participants)~~confirmation.

~~The~~Some ~~Units~~Bitcoin transactions are ~~restricted~~conducted ~~securities~~“off-blockchain” ~~that~~and ~~may~~are therefore not berecorded ~~resold~~in ~~except~~the inBitcoin blockchain. Some “off-blockchain transactions” ~~exempt~~involve ~~from~~the ~~registration~~transfer ~~under~~of ~~the~~control ~~Securities~~over, ~~Act~~or ownership of, a specific digital wallet holding Bitcoin or the reallocation ~~and~~of ~~state~~ownership ~~securities~~of ~~laws~~certain ~~and~~Bitcoin ~~any~~in a digital wallet containing assets owned by multiple persons, such ~~transaction~~as ~~must~~a bedigital ~~approved~~wallet maintained by ~~the~~a ~~Sponsor~~digital assets platform. In ~~determining~~contrast ~~whether~~ to ~~grant~~on-blockchain ~~approval~~transactions, which are publicly recorded on the Bitcoin blockchain, information ~~Sponsor~~and ~~will~~data ~~specifically~~regarding ~~look~~off-blockchain attransactions ~~whether~~are generally not publicly available. Therefore, off-blockchain transactions are not truly Bitcoin transactions in that they do not involve the ~~conditions~~transfer of ~~Rule~~transaction ~~144~~data ~~under~~on the ~~Securities~~Bitcoin ~~Act~~network and ~~any~~do ~~other~~not ~~applicable~~reflect ~~laws~~a ~~have~~movement ~~been~~of ~~met~~Bitcoin between addresses recorded in the Bitcoin blockchain. ~~Any~~For ~~attempt~~these reasons, off-blockchain transactions are subject to ~~sell~~risks as ~~Units~~any ~~without~~such transfer of Bitcoin ownership is not protected by the ~~approval~~protocol ofbehind the ~~Sponsor~~Bitcoin innetwork ~~its~~or ~~sole~~recorded ~~discretion~~in, ~~will~~and bevalidated ~~void~~through, the abblockchain ~~initio~~mechanism.

~~The~~Summary ~~Trust’s assets consist solely~~ of Bitcoins, Additional Currency (as defined below), proceeds from the sale of Bitcoins and Additional Currency pending use of such cash for payment of Extraordinary Expenses or distribution to the Unitholders and any rights of the Trust pursuant to any agreements, other than the Trust Agreement, to which the Trust is a ~~party. Each Unit represents a proportional interest, based on the total number of Units outstanding, in each of the Trust’s assets as determined in the case of~~ Bitcoin by reference to the Bitcoin Market Price, less the Trust’s expenses and other liabilities (which include accrued but unpaid fees and expenses). The Sponsor expects that the market price of the Units will fluctuate over time in response to the market price of Bitcoins. In addition, because the Units reflect the estimated accrued but unpaid expenses of the Trust, the number of Bitcoins represented by a Unit will gradually decrease over time as the Trust’s Bitcoins are used to pay the Trust’s expenses. The Trust does not expect to take any Additional Currency it may hold into account for purposes of determining the Trust’s Bitcoin Holdings or the Bitcoin Holdings per Unit.Transaction

~~The~~In ~~Trust’s~~a ~~Bitcoins~~Bitcoin ~~are~~transaction ~~carried,~~directly ~~for~~on ~~financial~~the ~~statement~~Bitcoin ~~purposes,~~network atbetween ~~fair~~two ~~value,~~parties (as ~~required~~opposed byto ~~the~~through ~~U.S.~~an ~~generally~~intermediary, ~~accepted accounting~~such ~~principles (“GAAP”). The Trust values its Bitcoin Holdings at the Bitcoin Market Price~~ as ofa ~~4:00 p.m.,~~platform ~~New~~or ~~York~~a ~~time~~custodian), onthe ~~each~~following ~~Business~~circumstances ~~Day.~~must ~~The~~initially ~~net~~be ~~asset~~in ~~value~~place: of(i) the ~~Trust~~party ~~determined~~seeking onto asend ~~GAAP~~Bitcoin ~~basis~~must ishave ~~referred~~a toBitcoin ~~in this Annual Report~~network aspublic ~~“NAV.”~~key, ~~The~~and ~~Trust~~the ~~uses~~Bitcoin ~~Coinbase~~network ~~Pro~~must asrecognize ~~its~~that ~~principal~~public ~~market.~~key ~~The~~as ~~Trust~~having ~~selected~~sufficient ~~Coinbase Pro, among other~~ Bitcoin ~~markets,~~ ~~because~~for ~~it provides~~ the ~~greatest~~transaction; ~~liquidity,~~(ii) ~~with approximately 75% of daily trading volume in~~ the ~~U.S. as of January 6,~~receiving ~~2023.~~party ~~More~~must ~~information~~have ~~about~~a ~~the~~Bitcoin ~~valuation~~network ofpublic ~~the~~key; ~~Trust’s NAV~~ and ~~the~~(iii) ~~use of~~ the ~~Bitcoin~~spending ~~Market~~party ~~Price~~must ishave ~~located~~internet ~~herein~~access ~~under “Valuation~~with ofwhich ~~Bitcoin~~to ~~and~~send ~~Determination~~its ~~of NAV~~spending transaction.”

ToThe ~~determine~~receiving ~~which~~party ~~Bitcoin~~must ~~market~~provide ~~will~~the ~~serve~~spending asparty ~~the~~with ~~Trust’s~~its ~~principal~~public ~~market~~key ~~(or~~and inallow the ~~absence~~Bitcoin ofblockchain ato ~~principal~~record ~~market,~~ the ~~most advantageous~~sending ~~market)~~of ~~for~~Bitcoin to ~~purposes~~that ofpublic ~~calculating~~key. After the ~~Trust~~provision of a recipient’s ~~NAV~~Bitcoin network public key, the ~~Trust~~spending ~~follows~~party ~~Financial~~must ~~Accounting~~enter ~~Standards~~the ~~Board~~address ~~(“FASB”)~~into ~~Accounting~~its ~~Standards~~Bitcoin ~~Codification~~network ~~(“ASC”)~~software ~~820-10,~~program ~~which~~along ~~outlines~~with the ~~application~~number of ~~fair~~Bitcoin ~~value accounting.~~to ~~ASC~~be ~~820-10~~sent. ~~determines~~The ~~fair~~number ~~value~~of Bitcoin to be ~~the~~sent ~~price~~will ~~that~~typically be ~~would~~agreed beupon ~~received~~between ~~for~~the ~~Bitcoin~~two inparties based on a ~~current~~set ~~sale,~~number ~~which~~of ~~assumes an~~Bitcoin ~~orderly~~or ~~transaction~~an ~~between~~agreed ~~market~~upon ~~participants~~conversion onof the ~~measurement~~value ~~date~~of fiat currency to Bitcoin. ~~ASC~~Since ~~820-10~~every ~~requires~~computation on the ~~Trust~~Bitcoin tonetwork ~~assume~~requires ~~that~~the payment of Bitcoin is, ~~sold~~including inverification ~~its~~and ~~principal~~memorialization ~~market~~of Bitcoin totransfers, ~~market~~there ~~participants~~is ~~or,~~a intransaction fee involved with the ~~absence~~transfer, ofwhich ais ~~principal~~based ~~market,~~on ~~the~~computation ~~most~~complexity ~~advantageous~~and ~~market. Market~~not ~~participants~~on ~~are~~the ~~defined~~value of asthe ~~buyers~~transfer, and ~~sellers~~is inpaid by the ~~principal~~payor orwith a fractional number of Bitcoin.

After the entry of the Bitcoin network address, the number of Bitcoin to be sent and the transaction fees, if any, to be paid, will be transmitted by the spending party. The transmission of the spending transaction results in the creation of a data packet by the spending party’s Bitcoin network software program, which is transmitted onto the decentralized Bitcoin network, resulting in the distribution of the information among the software programs of users across the Bitcoin network for eventual inclusion in the Bitcoin blockchain.

As discussed ~~most~~in ~~advantageous~~greater ~~market~~detail ~~that~~below ~~are~~in ~~independent~~“Creation of New Bitcoin,” ~~knowledgeable~~Bitcoin network miners record transactions when they solve for and ~~willing~~add blocks of information to the Bitcoin blockchain. When a miner solves for a block, it creates that block, which includes data relating to (i) the solution to the block; (ii) a reference to the prior block in the Bitcoin blockchain to which the new block is being added; and ~~able~~(iii) transactions that have occurred but have not yet been added to ~~transact~~the Bitcoin blockchain. The miner becomes aware of outstanding, unrecorded transactions through the data packet transmission and distribution discussed above.

~~The~~Upon ~~cost~~the ~~basis~~addition of a ~~Trust~~block ~~investment~~included in the Bitcoin ~~recorded~~blockchain, by the ~~Trust~~Bitcoin ~~for~~network ~~financial~~software ~~reporting~~program ~~purposes~~of isboth the ~~fair~~spending ~~value~~party ofand the ~~Bitcoin~~receiving atparty ~~the~~will ~~time~~show confirmation of ~~contribution~~the totransaction on the ~~Trust.~~Bitcoin ~~The~~blockchain ~~Bitcoin~~and ~~cost~~reflect ~~basis~~an ~~recorded~~adjustment byto the ~~Trust~~Bitcoin ~~may~~balance ~~differ~~in ~~from~~each ~~the~~party’s Bitcoin ~~value~~network ofpublic key, completing the ~~proceeds collected~~Bitcoin bytransaction. ~~the~~Once ~~Sponsor~~a ~~from~~transaction ~~the~~is ~~sale~~confirmed ofon the ~~corresponding~~Bitcoin ~~Units~~blockchain, toit ~~investors~~is irreversible.

~~Activities of the~~Bitcoin ~~Trust~~Markets

~~The~~In ~~activities~~addition ofto ~~the~~using ~~Trust~~Bitcoin ~~are limited~~ to ~~(i)~~engage ~~issuing~~in ~~Units~~transactions, ininvestors ~~exchange~~may ~~for~~purchase ~~cash~~and orsell Bitcoin ~~transferred~~ to ~~the~~speculate ~~Trust~~ as ~~consideration in~~to ~~connection with~~ the ~~issuance~~value of ~~the Units, (ii) transferring or selling~~ Bitcoin ~~[(including any Additional Currency obtained~~ ~~as a result of forks~~ in the Bitcoin ~~Network~~market, or ~~airdrops)]~~ as ~~necessary~~a long-term investment to ~~pay~~diversify ~~the~~their 0portfolio.~~49%~~ ~~Management~~The ~~Fee~~value ~~(as~~of ~~defined~~Bitcoin ~~herein),~~within ~~as well~~the asmarket ~~any~~is ~~Excluded~~determined, in ~~Expenses~~part, ~~and~~by ~~any~~the ~~Extraordinary~~supply ~~Expenses~~of ~~(as~~and ~~each~~demand isfor ~~defined~~Bitcoin in the ~~Trust~~global ~~Agreement,~~Bitcoin ~~the “Aggregate Trust Expenses”)~~market, ~~(iii)~~market ~~transferring~~expectations ~~Bitcoin in exchange~~ for ~~Units~~the ~~surrendered~~adoption ~~for~~of ~~redemption~~Bitcoin ~~(at such time~~ as ~~redemptions~~a ~~from~~store ~~the Trust are permitted by the SEC and subject to the approval~~ of ~~the Sponsor)~~value, ~~(iv) causing~~ the ~~Sponsor~~number ~~to sell Bitcoin upon the termination~~ of ~~the~~merchants ~~Trust,~~that ~~(v)~~accept ~~making distributions of~~ Bitcoin ~~(including~~as ~~any~~a ~~Additional~~form ~~Currency)~~of orpayment, ~~cash~~and ~~from~~ the ~~sale~~volume ~~thereof and~~of ~~(vi) engaging in all administrative and security procedures necessary~~ peer-to-peer ~~accomplish~~transactions, ~~such~~among ~~activities in accordance with the~~other ~~provisions of the Trust Agreement and the Custodial Services Agreement~~factors.

~~The~~Centralized ~~Trust~~spot isBitcoin markets typically permit investors to open accounts with the trading platform and then purchase and sell Bitcoin via websites or through mobile applications. Prices for trades on centralized spot Bitcoin markets are typically reported publicly. An investor opening a ~~passive~~trading ~~investment~~account ~~vehicle~~must deposit an accepted government-issued currency into their account with the spot market, ~~and~~or ~~its~~a ~~assets~~previously ~~will~~acquired digital ~~not~~asset, bebefore ~~actively~~they ~~managed~~can purchase or sell assets on the spot market. AsThe process of establishing an account with a ~~result~~centralized Bitcoin market and trading Bitcoin is different from, itand ~~will~~should not ~~engage~~be inconfused ~~any~~with, ~~activities~~the process of users sending Bitcoin from one ~~designed~~Bitcoin address to ~~obtain~~another aBitcoin ~~profit~~address ~~from,~~on the Blockchain or todecentralized ~~ameliorate~~on-chain ~~losses~~trading ~~caused~~platforms. byThis latter process is an activity that occurs on the Bitcoin network, ~~changes~~while inthe former is an activity that occurs entirely within the order book operated by the centralized spot market. ~~prices~~The centralized spot market typically records the investor’s ownership of Bitcoin in its internal books and records, rather than on the Blockchain. The centralized spot market ordinarily does not transfer Bitcoin to the investor on the Blockchain unless the investor makes a request to the digital asset trading platform to withdraw the Bitcoin in their account to an off-exchange Bitcoin wallet.

~~The~~In ~~Sponsor~~addition, ~~calculates~~Bitcoin futures and options trading occurs on exchanges in the ~~Trust’s~~U.S. ~~NAV~~regulated ~~per~~by ~~Unit~~the asCFTC. The market for CFTC regulated trading of ~~4:00~~Bitcoin pderivatives has developed substantially.~~m.,~~ ~~New~~Through ~~York~~the ~~time~~common onmembership ~~each~~of ~~Business~~the ~~Day~~Listing Exchange and the CME Bitcoin Futures market in the Intermarket Surveillance Group (“ISG”), the Listing Exchange may obtain information regarding trading in the Shares and ~~publishes~~listed Bitcoin derivatives from the ~~NAV~~CME ~~per~~Bitcoin Futures market via the ISG and from other exchanges who are members or affiliates ~~Unit~~of the ISG. Such an arrangement with the ISG and the CME Bitcoin Futures market allows for the surveillance of Bitcoin futures market conditions and price movements on a real-time and ongoing basis in order to detect and prevent price distortions, including price distortions caused by manipulative efforts. The sharing of surveillance information between the ~~Trust~~Listing Exchange and the CME Bitcoin Futures market regarding market trading activity, clearing activity and customer identity assists in detecting, investigating and deterring fraudulent and manipulative misconduct, as well as violations of the Listing Exchange’s ~~website~~rules ~~(www~~and the applicable federal securities laws and rules.~~ospreyfunds.io)~~ ~~shortly~~The ~~thereafter~~Listing Exchange has also implemented surveillance procedures to monitor the trading of the Shares on the Listing Exchange during all trading sessions and to deter and detect violations of The Listing Exchange rules and the applicable federal securities laws.

~~Additional~~Creation of ~~Currency~~New Bitcoin

~~From~~New ~~time~~Bitcoin to time, the Trust may come into possession of rights incident to its ownership of Bitcoins, which permit the Trust to acquire, or otherwise establish dominion and control over, other virtual currencies. These rights are ~~generally~~created ~~expected~~through ~~to arise in connection with forks in~~ the ~~Bitcoin~~mining ~~Network,~~process ~~airdrops offered to holders of Bitcoins and other similar events and arise without any action of the Trust or of the Sponsor or Trustee on behalf of the Trust. We refer to these rights~~ as ~~“Incidental~~discussed ~~Rights” and any such virtual currency acquired through Incidental Rights as “Additional Currency~~below.~~” The Trust does not expect to take any Additional Currency it may hold into account for purposes of determining the Trust’s Bitcoin Holdings or the Bitcoin Holdings per Unit.~~

~~Section~~The ~~3.6~~Bitcoin ofnetwork ~~the~~is ~~Amendment~~kept torunning ~~Trust~~by ~~Agreement,~~computers ~~dated~~all ~~April~~over ~~15, 2022, provides that if~~ the ~~Trust~~world. ~~comes~~In order to ~~own~~incentivize ~~any~~those ~~airdropped~~who ~~cryptocurrency (other~~incur ~~than Bitcoin),~~ the ~~Sponsor~~computational ~~shall~~costs ~~distribute such airdropped cryptocurrency within forty-five days~~ of ~~receipt of such assets~~securing ~~(or such longer time as~~ the ~~Sponsor~~network ~~reasonably~~by ~~requires~~validating totransactions, ~~effect~~there ~~such~~is ~~distribution) on~~ a ~~pro~~reward ~~rata~~that ~~basis~~is given to ~~Unitholders. If~~ the ~~Trust~~ ~~comes~~computer tothat ~~own~~was ~~any~~able ~~forked~~to ~~versions~~create ~~of Bitcoin,~~ the ~~Sponsor~~latest ~~shall~~block ~~distribute~~on ~~such forked version or versions of Bitcoin,~~ the ~~Sponsor~~chain. ~~shall~~Every ~~distribute~~ten ~~such~~minutes, ~~forked~~on ~~version~~average, ora ~~versions~~new ~~within~~block ~~forty-five~~is ~~days~~added ofto ~~receipt~~the ~~(or~~Bitcoin ~~such~~blockchain ~~longer~~with ~~time as~~ the ~~Sponsor reasonably~~latest ~~requires~~transactions toprocessed ~~effect~~by ~~such~~the ~~distribution) on a pro rata basis to Unitholders if~~ network, and to the ~~extent~~computer that ~~the~~generated ~~Sponsor~~this ~~determines in~~block ~~its~~is ~~reasonable~~currently ~~discretion~~awarded ~~that~~3.125 ~~such~~Bitcoin. aDue ~~distribution is necessary~~ to ~~preserve~~ the ~~federal~~nature ~~tax treatment~~ of the ~~Trust~~algorithm ~~set~~for ~~forth in~~block ~~Section 1.6 of the Trust Agreement~~generation, this ~~and~~process ~~may~~(generating ~~distribute~~a ~~such forked version or versions within forty~~“proof-~~five days~~ of-work”) ~~receipt~~is ~~(or such~~random. ~~longer~~Over time, asrewards ~~the~~are ~~Sponsor~~expected ~~reasonably requires~~ to ~~effect~~be ~~such~~proportionate ~~distribution) on a pro rata basis~~ to ~~Unitholders if and to~~ the computational ~~extent~~power ~~the Sponsor determines it is in the best interests~~ of ~~the~~each ~~Unitholders~~machine.

Trust Expenses

The Trust will pay as an ordinary recurring charge the remuneration due to the Sponsor (the “Management Fee” or “Sponsor Fee”). The Management Fee equals an annualized 0.49% of the average daily NAV of the Trust for each year. The Management Fee will accrue daily in Bitcoin and will be payable, at the Sponsor’s sole discretion, in Bitcoin or in U.S. dollars at the Bitcoin Market Price in effect at the time of such payment. The Sponsor expects that the Trust will pay the Management Fee in monthly installments in arrears. If the Trust holds any Additional Currency, the Trust may pay the Management Fee, in whole or in part, with such Additional Currency by entering into an agreement with the Sponsor and transferring such Additional Currency to the Sponsor at a value to be determined in accordance with the terms of such agreement, but only if such agreement and transfer do not conflict with the terms of the Trust Agreement.

The Sponsor will bear the routine operational, administrative and other ordinary fees and expenses of the Trust (the “Assumed Expenses”); provided, however, that the Trust shall be responsible for audit fees, index license fees, aggregate legal fees in excess of $50,000 per annum and the fees of the Custodian (the “Excluded Expenses”) and certain extraordinary expenses of the Trust, including but not limited to taxes and governmental charges, expenses and costs, expenses and indemnities related to any extraordinary services performed by the Sponsor (or any other Service Provider, including the Trustee) on behalf of the Trust to protect the Trust or the interest of Unitholders, indemnification expenses, fees and expenses related to public quotation on OTCQX (the “Extraordinary Expenses”).

~~Although~~The ~~the~~process ~~Sponsor~~by ~~can~~which ~~provide~~Bitcoin nois ~~assurance~~“mined” asresults toin ~~the~~new ~~frequency~~blocks orbeing ~~magnitude~~added ofto ~~any Extraordinary Expenses,~~ the ~~Sponsor~~Bitcoin ~~expects~~blockchain ~~that~~and ~~they may~~new ~~occur~~Bitcoin ~~infrequently,~~tokens ~~if at all. The Trust has not incurred or paid any Extraordinary Expenses to date. If the Trust incurs any~~being ~~Extraordinary~~issued ~~Expenses, the Sponsor or its delegate (i) would instruct the Custodian~~ to ~~withdraw from~~ the ~~digital~~miners. ~~asset~~Computers ~~account (the “Custodial Account”),~~ on athe ~~monthly~~Bitcoin ~~basis~~network asengage ~~needed, Bitcoins, Additional Currency~~ in ~~such~~a ~~quantity~~set ~~as necessary to permit payment~~ of ~~such~~prescribed ~~Extraordinary~~complex ~~Expenses,~~mathematical ~~and~~calculations ~~(ii)~~in ~~may~~order ~~either (x) cause the Trust (or its delegate)~~ to ~~convert such Bitcoins~~add ora ~~Additional~~block ~~Currency~~to ~~into U.S. dollars or other fiat currencies at~~ the ~~exchange~~Bitcoin ~~rate~~blockchain atand ~~the~~thereby ~~time~~confirm ofBitcoin ~~conversion~~transactions orincluded ~~(y) cause the Trust (or its delegate) to deliver such Bitcoins or Additional Currency~~ in ~~kind~~that inblock’s ~~satisfaction of such Extraordinary Expenses~~data.

~~The~~To ~~Administrator~~begin mining, a user can download and run Bitcoin network mining software, which turns the user’s computer into a “node” on ~~behalf~~the Bitcoin network that validates blocks. Each block contains the details of some or all of the ~~Trust~~most recent transactions that are not memorialized in prior blocks, ~~accrues~~as well as a record of the ~~custody,~~award ~~index~~of Bitcoin to the miner who added the new block. Each unique block can be solved and ~~Management~~added ~~Fees~~to onthe aBitcoin ~~daily~~blockchain ~~basis~~by only one miner. ~~Custody~~Therefore, ~~fees~~all ~~are~~individual ~~calculated based~~miners and mining pools on the ~~total~~Bitcoin network ~~assets~~are ~~held~~engaged in ~~the~~a ~~Trust~~competitive asprocess of ~~the~~constantly ~~end~~increasing their computing power to improve their likelihood of solving for new blocks. As more miners join the ~~day~~Bitcoin network and ~~according~~its toprocessing power increases, the ~~agreed~~Bitcoin ~~upon~~network ~~fee~~adjusts ~~schedule~~the ~~with~~complexity of the ~~Custodian~~block-solving equation to maintain a predetermined pace of adding a new block to the Bitcoin blockchain approximately every ten minutes. ~~Management~~A ~~Fees~~miner’s ~~are~~proposed ~~calculated~~block ~~daily~~is ~~net~~added to the Bitcoin blockchain once a majority of the ~~current~~nodes ~~day-accrued~~on ~~Custody~~the ~~fees~~Bitcoin network confirm the miner’s work. ~~All~~Miners ~~expenses~~that are ~~allocated~~successful ~~pro~~in ~~rata~~adding ~~based~~a on block to the ~~number~~Bitcoin ofblockchain ~~Units~~are ~~issued~~automatically awarded Bitcoin for their effort and ~~outstanding~~may also receive transaction fees paid by transferors whose transactions are recorded in the block. This reward system is the method by which new Bitcoin enter into circulation to the public.

~~Secondary~~The Bitcoin ~~Market~~network is designed in such a way that the reward for adding new blocks to the Bitcoin blockchain decreases over time. Once new ~~Trading~~Bitcoin tokens are no longer awarded for adding a new block, miners will only have transaction fees to incentivize them, and as a result, it is expected that miners will need to be better compensated with higher transaction fees to ensure that there is adequate incentive for them to continue mining.

~~While~~Limits the Trust’s investment objective is for the Units to reflect performance of Bitcoin measured by reference to the Index, less the Aggregate Trust Expenses and other liabilities, the Units may trade in the secondary market on the OTCQX (or on another secondary market in the future) at prices that are lower or higher than the NAV per Unit. The Units may trade at a substantial premium over, or substantial discount to, the NAV per Unit due to such factors as Trust fees and expenses, the quantity of Units available for trading, the relative liquidity of the Units, and differences in the markets trading Bitcoin ~~and Units (e.g., hours of operation, marketplace rules, clearance and settlement, and market participants).~~Supply

~~Service~~Under the ~~Providers~~source code that governs the Bitcoin network, the supply of new Bitcoin is mathematically controlled so that the number of Bitcoin grows at a limited rate pursuant to a pre-set schedule. The number of Bitcoin awarded for solving a new block is automatically halved after every 210,000 blocks are added to the ~~Trust~~Bitcoin blockchain, approximately every four years. Currently, the fixed reward for solving a new block is 3.125 Bitcoin per block and this is expected to decrease by half to become 1.5625 Bitcoin in approximately mid-2028. This deliberately controlled rate of Bitcoin creation means that the number of Bitcoin in existence will increase at a controlled rate until the number of Bitcoin in existence reaches the pre-determined twenty-one million Bitcoin. However, the twenty-one million supply cap could be changed in a hard fork. In the past, there have been several forks in the Bitcoin network, including, but not limited to, forks resulting in the creation of Bitcoin Cash (August 1, 2017), Bitcoin Gold (October 24, 2017) and Bitcoin SegWit2X (December 28, 2017), among others. For further information, see “Risk Factors —Risk Factors Related to Digital Assets—A hard fork could change the source code to the Bitcoin network, including the twenty-one million Bitcoin supply cap.” As of December 31, 2025, approximately 19.970 million Bitcoin were outstanding and the date when the twenty-one million Bitcoin limitation will be reached is estimated to be the year 2140.

~~The~~Modifications to ~~Sponsor~~the Bitcoin Protocol

~~The~~Bitcoin ~~Trust~~is an open-source project with no official developer or group of developers that controls the Bitcoin network. However, the Bitcoin network’s development ~~Sponsor~~ is ~~Osprey~~overseen ~~Funds~~by a core group of developers. The core developers are able to access, ~~LLC~~and can alter, the Bitcoin network source code and, as a ~~Delaware~~result, ~~limited~~they ~~liability~~are ~~company~~responsible ~~formed~~for onquasi-official ~~October~~releases ~~31,~~of ~~2018~~updates and other changes to the Bitcoin network’s source code. The ~~Sponsor~~release of updates to the Bitcoin network’s source code does not guarantee that the updates will be automatically adopted. ~~principal~~Users ~~place~~and miners must accept any changes made to the Bitcoin source code by downloading the proposed modification of ~~business~~the Bitcoin network’s source code. A modification of the Bitcoin network’s source code is ~~1241~~effective ~~Post~~only ~~Road,~~with ~~2nd~~respect ~~Floor,~~to ~~Fairfield,~~the ~~Connecticut~~Bitcoin ~~06824~~users and ~~its~~miners that ~~telephone~~download ~~number~~it. If a modification is ~~(914) 214-4697.~~accepted ~~Under~~by only a percentage of users and miners, a division in the ~~Delaware~~Bitcoin ~~Limited~~network ~~Liability~~will ~~Company~~occur such ~~Act~~that one network will run the pre-modification source code and the ~~governing~~other ~~documents~~network ofwill run the ~~Sponsor,~~modified ~~Gregory~~source Dcode. ~~King~~Such a division is ~~not~~known ~~responsible~~as a “fork.” See “Risk Factors—Risk Factors Related to Digital Assets—A temporary or permanent ~~for~~“fork” could adversely affect the ~~debts~~value of the Shares.” In addition, ~~obligations~~Shareholders ~~and~~will ~~liabilities~~not receive the benefits of any Incidental Rights or any IR Virtual Currency, including any forked or airdropped assets. Consequently, as a practical matter, a modification to the ~~Sponsor~~source ~~solely~~code becomes part of the Bitcoin network only if accepted by ~~reason~~participants collectively having most of ~~being~~the processing power on the ~~sole~~Bitcoin ~~member~~network. ofThere have been several forks in the ~~Sponsor~~Bitcoin network, including, but not limited to, forks resulting in the creation of Bitcoin Cash (August 1, 2017), Bitcoin Gold (October 24, 2017) and Bitcoin SegWit2X (December 28, 2017), among others.

~~The~~Core ~~Sponsor~~development isof ~~neither~~the anBitcoin ~~investment~~network ~~adviser~~source ~~under~~code has increasingly focused on modifications of the ~~Investment~~Bitcoin ~~Advisers~~network ~~Act~~protocol to increase speed and scalability and also allow for non-financial, next generation uses. For example, following the activation of ~~1940~~Segregated Witness on the Bitcoin network, asan ~~amended~~alpha (version of the ~~“Advisers~~Lightning ~~Act”)~~Network was released. The Lightning Network is an open-source decentralized ~~registered~~network ~~with~~that enables instant off-Bitcoin blockchain transfers of the ~~SEC~~ownership ~~nor~~of Bitcoin without the need of a ~~commodity~~trusted ~~pool~~third-party. The ~~operator~~system ~~registered~~utilizes ~~with~~bidirectional ~~the~~payment ~~CFTC~~channels that consist of multi-signature addresses. One on-blockchain transaction is needed to open a channel and ~~will~~another ~~not~~on-blockchain transaction can close the channel. Once a channel is open, value can be ~~acting~~transferred instantly between counterparties, who are engaging in ~~either~~real ~~such~~Bitcoin ~~capacity~~transactions ~~with~~without broadcasting them to the Bitcoin network. New transactions ~~respect~~will replace previous transactions and the counterparties will store everything locally as long as the channel stays open to increase transaction throughput and reduce computational burden on the ~~Trust,~~Bitcoin network. Other efforts include increased use of smart contracts and distributed registers built into, built atop or pegged alongside the ~~Sponsor~~Bitcoin blockchain. The Trust’s ~~provision~~activities ofwill ~~services~~not directly relate to such projects, though such projects may utilize Bitcoin as tokens for the ~~Trust~~facilitation ~~will~~of their non-financial uses, thereby potentially increasing demand for Bitcoin and the utility of the Bitcoin network as a whole. Conversely, projects that operate and are built within the Bitcoin blockchain may increase the data flow on the Bitcoin network and could either “bloat” the size of the Bitcoin blockchain or slow confirmation times. At this time, such projects remain in early stages and have not bebeen ~~governed~~materially byintegrated into the ~~Advisers~~Bitcoin ~~Act~~blockchain or the ~~CEA~~ Bitcoin network.

The Sponsor arranged for the creation of the Trust and quotation of the Units on the OTCQX. The Management Fee is paid by the Trust to the Sponsor for services performed under the Trust Agreement and as partial consideration for Sponsor’s agreement to pay the Assumed Expenses. After payment of the Assumed Expenses for the Trust, the Sponsor may use the remaining portion of the Management Fee received from the Trust at its discretion, which may include the payment of fees from time to time for the referral of new investors in the Trust.

The Sponsor is generally responsible for the day-to-day administration of the Trust under the provisions of the Trust Agreement. This includes (i) preparing and providing periodic reports and financial statements on behalf of the Trust for investors, (ii) processing orders to create (and, should the Trust commence a redemption program, redeem) Units and coordinating the processing of such orders with the Custodian and the Transfer Agent, (iii) calculating and publishing the NAV per Unit and the Bitcoin Holdings per Unit of the Trust each Business Day as of 4:00 p.m., New York time, or as soon thereafter as practicable, (iv) selecting and monitoring the Trust’s service providers and from time to time engaging additional, successor or replacement service providers (including without limitation the Administrator, Custodian, Cash Custodian, Transfer Agent and Index Provider), (v) instructing the Custodian to withdraw the Trust’s Bitcoin as needed to pay the Management Fee and the other Aggregate Trust Expenses, (vi) upon dissolution of the Trust, distributing the Trust’s remaining Bitcoin or the cash proceeds of the sale thereof to the owners of record of the Units and (vii) when applicable, establishing the principal market for GAAP valuation. In addition, if there is a fork in the Bitcoin Network after which there is a dispute as to which network resulting from the fork is the Bitcoin Network, the Sponsor has the authority to select the network that it believes in good faith is the Bitcoin Network, unless such selection or authority would otherwise conflict with the Trust Agreement.

The Sponsor does not store, hold or maintain custody or control of the Trust’s Bitcoin but instead has entered into the Custodial Services Agreement with the Custodian to facilitate the security of the Trust’s Bitcoin.

The Sponsor may transfer all or substantially all of its assets to an entity that carries on the business of the Sponsor if at the time of the transfer the successor assumes all of the obligations of the Sponsor under the Trust Agreement. In such an event, the Sponsor will be

~~relieved~~ Forms of ~~all~~Attack ~~further~~Against ~~liability under~~ the ~~Trust~~Bitcoin ~~Agreement.~~Network

~~Index~~All ~~Provider~~networked ~~Agreement~~systems are vulnerable to various kinds of attacks. As with any computer network, the Bitcoin network contains certain flaws. For example, the Bitcoin network is currently vulnerable to a “51% attack” where, if a mining pool were to gain control of more than 50% of the hash rate for a digital asset, a malicious actor would be able to prevent new transactions from confirmation, and reverse new transactions that are completed while they are in control of the network, effectively enabling them to double-spend their Bitcoin.

~~The~~In ~~Index~~addition, ~~Provider~~many ~~and~~digital ~~the~~asset ~~Sponsor~~networks have ~~entered~~been ~~into~~subjected anto ~~index~~a ~~provider~~number ~~agreement~~of ~~(the~~denial ~~“Index~~of ~~Provider~~service ~~Agreement”)~~attacks, ~~governing the~~which ~~Sponsor’s~~has ~~use~~led ofto ~~the~~temporary ~~Index.~~delays in ~~The~~block ~~Index~~creation ~~Provider~~and ~~may~~in ~~adjust~~ the ~~calculation~~transfer ~~methodology for the Index without notice to, or consent~~ of, ~~the Trust or its Unitholders~~Bitcoin. ~~Under~~Any ~~the~~similar ~~Index~~attacks ~~Provider Agreement, the Sponsor pays a monthly fee and a fee based~~ on the Bitcoin ~~Holdings~~network ofthat impact the ~~Trust~~ability to ~~the~~transfer ~~Index~~Bitcoin could ~~Provider~~have ina ~~consideration~~material ofadverse ~~its~~effect ~~license~~on to the ~~Sponsor~~price of ~~Index-related~~Bitcoin ~~intellectual property.~~and ~~The Trust reimburses~~ the ~~Sponsor~~value ~~the index license fees as part~~ of the ~~Excluded Expenses~~Shares.

~~Under~~Market the Index Provider Agreement, the Index Provider generally disclaims all warranties, including non-infringement and fitness for a particular purpose. The Index is provided on an “as-is,” “as available,” and “with all faults” basis. The Index Provider, however, agreed to indemnify the Sponsor and the Trust against any claim, demand suit, investigation or proceeding made or brought by a third party, alleging that the use of the service permitted under the Index Provider Agreement infringes or misappropriates a third-party copyright, trade secret, trademark or United States patent. The Index Provider will pay all costs, including reasonable attorneys’ fees and any settlement amounts agreed to by the Index Provider or damages award in connection with such third-party claim.Participants

The Trust will notify Unitholders of material changes to Index methodology or composition, upon being notified of such change by the Index Provider, through a filing of a current report on Form 8-K with the SEC.Miners

~~Pursuant~~Miners are primarily professional mining operations that design and build dedicated machines and data centers, including mining pools, which are groups of miners that act cohesively and combine their processing to ~~the~~solve ~~Trust~~blocks. ~~Agreement~~When a pool solves a new block, the ~~Sponsor~~pool ~~has~~operator receives ~~general~~the ~~discretion~~Bitcoin toand, ~~select~~after taking a ~~different~~nominal ~~index~~fee, ~~(or~~splits ~~otherwise~~the ~~change~~resulting reward among the ~~fund’s~~pool ~~investment~~participants based on the processing ~~objectives)~~power each of them contributed to solve for such block. Mining pools provide participants with access to smaller, but steadier and more frequent, Bitcoin payouts.

~~Under~~Investment ~~the Index Provider Agreement, the Sponsor may use the Index, including without limitation, for use in internal fund administration such as portfolio valuation~~ and ~~accounting~~Speculative and for display on Sponsor’s websites, social media, or mobile applications, as well as inclusion in publications, reports, advertisements and other informational materials. The Trust currently uses the Index solely as the basis for determining the Trust’s investment objective. It does not currently rely on the Index for determining NAV or otherwise valuing Trust assets.Sector

~~The~~This ~~Sponsor~~sector isincludes ~~required~~the toinvestment ~~indemnify~~and ~~the~~trading ~~Index~~activities ~~Provider,~~of ~~including~~both ~~its~~private ~~officers,~~and ~~directors,~~professional ~~employees,~~investors ~~agents,~~and ~~contractors~~speculators. Historically, ~~representatives~~larger ~~and~~financial ~~affiliates~~services ~~against~~institutions ~~any~~are ~~claims~~publicly ~~made~~reported orto ~~brought~~have ~~against~~limited ~~the~~involvement ~~Index~~in ~~Provider~~investment ~~arising~~and ~~from~~trading ~~Sponsor’s~~in ~~breach~~digital assets, oralthough the ~~alleged~~participation ~~breach, of~~landscape ~~the~~is ~~Index~~beginning ~~Provider~~to ~~Agreement~~change.

~~The~~Retail ~~Index Provider Agreement is governed by the laws of the Commonwealth of Massachusetts.~~Sector

The retail ~~Trustee~~sector includes users transacting in direct peer-to-peer Bitcoin transactions through the direct sending of Bitcoin over the Bitcoin network, as well as users accessing Bitcoin through digital asset platforms. The retail sector also includes transactions in which consumers pay for goods or services from commercial or service businesses through direct transactions or third-party service providers.

~~Delaware~~Service Trust Company serves as our trustee under the Trust Agreement. The Trustee has its principal office at 251 Little Falls Drive, Wilmington, Delaware 19808. The Trustee is unaffiliated with the Sponsor. A copy of the Trust Agreement is available for inspection at the Sponsor’s principal office identified above.Sector

~~The~~This ~~Trustee~~sector isincludes ~~appointed~~companies tothat ~~serve~~provide asa ~~the~~variety ~~trustee~~ of ~~the~~services ~~Trust~~including in the ~~State~~buying, ofselling, ~~Delaware~~payment ~~for~~processing ~~the~~and ~~sole~~storing ~~purpose~~ of ~~satisfying the requirement~~Bitcoin. ofBitstamp, ~~Section~~Coinbase, ~~3807(a)~~Kraken ofand ~~the~~LMAX ~~DSTA~~Digital ~~that~~are ~~the~~some ~~Trust have at least one trustee with a principal place~~ of ~~business in~~ the ~~State~~larger ofBitcoin ~~Delaware. The~~trading ~~duties~~platforms ofby ~~the~~volume ~~Trustee~~traded. ~~will~~Coinbase beCustody ~~limited to (i) accepting legal process served on the~~ Trust Company, inLLC, the ~~State~~Bitcoin ofCustodian ~~Delaware~~for ~~and (ii)~~ the ~~execution~~Trust, ofis ~~any~~a ~~certificates~~digital ~~required~~asset tocustodian bethat ~~filed~~provides ~~with~~custodial ~~the~~accounts ~~Delaware~~that ~~Secretary~~store ofBitcoin ~~State which the Trustee is required to execute~~for ~~under the DSTA~~users. ToIf the ~~extent~~Bitcoin ~~that,~~network atgrows ~~law or~~ in ~~equity~~adoption, ~~the~~it ~~Trustee~~is ~~has~~anticipated ~~duties~~that ~~(including~~service ~~fiduciary~~providers ~~duties)~~may ~~and~~expand ~~liabilities relating thereto to~~ the ~~Trust~~currently oravailable ~~the~~range ~~Unitholders, such duties and liabilities will be replaced by the duties and liabilities~~ of ~~the Trustee~~ ~~expressly~~services ~~set~~and ~~forth~~that inadditional ~~the~~parties ~~Trust Agreement. The Trustee~~ will ~~have~~enter nothe ~~obligation~~service tosector ~~supervise, nor will it be liable~~ for, the ~~acts or~~Bitcoin ~~omissions of the Sponsor, Transfer Agent, Custodian or any other person~~network.

Neither the Trustee, either in its capacity as trustee or in its individual capacity, nor any director, officer or controlling person of the Trustee is, or has any liability as, the issuer, director, officer or controlling person of the issuer of Units. The Trustee’s liability in connection with the issuance and sale of Units is limited solely to the express obligations of the Trustee as set forth in the Trust Agreement.Competition

~~The~~More ~~Trustee~~than ~~has~~10,000 ~~not~~other ~~prepared~~digital orassets ~~verified,~~have ~~and~~been ~~will~~developed ~~not~~since bethe ~~responsible~~inception orof ~~liable for~~Bitcoin, ~~any~~currently ~~information,~~the ~~disclosure~~most ordeveloped ~~other~~digital ~~statement~~asset because inof ~~this~~the ~~Annual~~length ~~Report~~of ortime init ~~any~~has ~~other~~been ~~document~~in ~~issued~~existence, orthe ~~delivered~~investment in ~~connection with~~ the ~~sale~~infrastructure orthat ~~transfer~~supports ofit, and the ~~Units.~~network ~~The~~of ~~Trust~~individuals ~~Agreement~~and ~~provides~~entities that ~~the~~are ~~Trustee~~using ~~will~~Bitcoin ~~not~~in betransactions. ~~responsible~~Some orindustry ~~liable~~groups ~~for~~are ~~the~~also ~~genuineness,~~creating ~~enforceability~~private, ~~collectability,~~permissioned ~~value,~~blockchain versions ~~sufficiency,~~of ~~location~~digital orassets. ~~existence~~See of“Risk ~~any~~Factors—Risk ofFactors Related to the ~~Bitcoins~~Digital Asset Markets—Competition from the emergence or growth of other digital assets or methods of investing in Bitcoin could have a negative impact on the ~~Trust~~price of Bitcoin and adversely affect the value of the Shares.”

~~The~~Government Trustee is permitted to resign upon at least 60 days’ notice to the Trust. The Trustee will be compensated by the Sponsor and indemnified by the Sponsor and the Trust against any expenses it incurs relating to or arising out of the formationOversight, ~~operation or~~Though ~~termination of the Trust~~Increasing, orRemains the performance of its duties pursuant to the Trust Agreement except to the extent that such expenses result from gross negligence, willful misconduct or bad faith of the Trustee. The Sponsor has the discretion to replace the Trustee.Limited

~~Fees~~As ~~paid~~digital assets have grown in both popularity and market size, the U.S. Congress and a number of U.S. federal and state agencies (including the U.S. Department of the Treasury Financial Crimes Enforcement Network (“FinCEN”), SEC, the Office of the Comptroller of the Currency (“OCC”), the Commodity Futures Trading Commission (“CFTC”), The Financial Industry Regulatory Authority (“FINRA”), the Consumer Financial Protection Bureau (“CFPB”), the Department of Justice, the Department of Homeland Security, the Federal Bureau of Investigation, the IRS and state financial institution regulators) have been examining the operations of digital asset networks, digital asset users and the digital asset platform markets, with particular focus on the extent to which digital assets can be used to launder the ~~Trustee~~proceeds ~~are~~of anillegal ~~Assumed~~activities ~~Expense~~or fund criminal or terrorist enterprises and the safety and soundness of exchanges or other service-providers that hold digital assets for users. Many of these state and federal agencies have issued consumer advisories regarding the risks posed by digital assets to investors. In addition, federal and state agencies, and other countries have issued rules or guidance about the treatment of digital asset transactions or requirements for businesses engaged in digital asset activity. However, no U.S. federal or state agency exercises comprehensive supervisory jurisdiction over global or domestic markets for Bitcoin.

~~For~~In addition, the SEC, U.S. state securities regulators and several foreign governments have issued warnings that certain digital assets or activities involving them, including, without limitation, those sold in ICOs, may be classified as securities and that both those digital assets and ICOs may be subject to securities regulations. On-going and future regulatory actions may alter, perhaps to a ~~complete~~materially adverse ~~discussion~~extent, the nature of an investment in the Shares or the ability of the Trust ~~Agreement~~to continue to operate. Additionally, ~~please~~U.S. ~~refer~~state and federal, and foreign regulators and legislatures have taken action against virtual currency businesses or enacted restrictive regimes in response to ~~Amendment~~adverse Nopublicity arising from hacks, consumer harm, or criminal activity stemming from virtual currency activity. 5The U.S. Treasury Department has expressed concern regarding digital assets’ potential to ~~Form~~be 10used ~~registration~~to ~~statement,~~fund ~~which~~illicit isactivities ~~incorporated~~and may seek to implement new regulations governing digital asset activities to address these concerns. See “Risk Factors—Risk Factors Related to the Regulation of the Trust and the Shares—Digital asset markets in the United States exist in a state of regulatory uncertainty, and adverse legislative or regulatory developments could significantly harm the value of Bitcoin or the Shares, such as by ~~reference~~banning, ~~herein~~restricting or imposing onerous conditions or prohibitions on the use of Bitcoin, mining activity, digital wallets, the provision of services related to trading and custodying Bitcoin, the operation of the Bitcoin network, or the digital asset markets generally.”

Various foreign jurisdictions have, and may continue to, in the near future, adopt laws, regulations or directives that may affect the Bitcoin network, digital asset platforms, and their users, particularly digital asset platforms and service providers that fall within such jurisdictions’ regulatory scope. There remains significant uncertainty regarding foreign governments’ future actions with respect to the regulation of digital assets and digital asset platforms. Such laws, regulations or directives may conflict with those of the United States and may negatively impact the acceptance of Bitcoin by users, merchants and service providers outside the United States and may therefore impede the growth or sustainability of the Bitcoin economy in their jurisdictions or globally, or otherwise negatively affect the value of Bitcoin. The ~~Transfer~~effect ~~Agent~~of any future regulatory change on the Trust or Bitcoin is impossible to predict, but such change could be substantial and adverse to the Trust and the value of the Shares.

Continental Stock Transfer & Trust Company, a Delaware corporation, serves as the Transfer Agent of the Trust pursuant to the terms and provisions of the Transfer Agency and Registrar Service Agreement. The ~~Transfer Agent has its principal office at 1 State Street,~~ ~~30th Floor, New York, New York 10004. A copy of the Transfer Agency and Registrar Service Agreement is available for inspection at the Sponsor’s principal office identified herein.~~Index

The ~~Transfer~~Index ~~Agent~~is ~~holds~~a ~~the~~once-a-day ~~Units~~benchmark ~~primarily~~index inprice ~~book-entry~~for ~~form.~~Bitcoin ~~The~~denominated ~~Sponsor~~in ~~directs~~U.S. ~~the~~Dollars ~~Transfer~~that ~~Agent~~synchronizes towith ~~credit~~ the ~~number~~traditional close of ~~Units~~U.S. tofinancial ~~the~~markets. ~~investor~~The inIndex ~~response~~is tocalculated and published once a ~~creation~~day ~~order~~at 4:00 p.m. New York time and has been since its launch on February 28, 2022. The ~~Transfer~~Index ~~Agent~~is ~~will~~provided ~~issue~~by CF Benchmarks Ltd., a Registered Benchmark under the ~~Units~~UK Benchmarks Regulation overseen by the UK Financial Conduct Authority (“UK FCA”). The ~~Transfer~~Index ~~Agent~~was ~~will~~created ~~also~~to ~~assist~~facilitate ~~with~~financial products based on Bitcoin. Specifically, the Index is calculated based on the ~~preparation~~“Relevant Transactions” (as defined below) of ~~Unitholders’~~all ~~account~~of ~~and~~its ~~tax~~constituent ~~statements.~~Bitcoin platforms (the “Constituent Bitcoin Platforms” or “Constituent Platforms”), as follows:

~~The Sponsor~~● ~~will~~All ~~indemnify~~Relevant Transactions that are executed between 3:00 p.m. and ~~hold~~4:00 ~~harmless~~p.m. ~~the~~New ~~Transfer~~York ~~Agent~~time are added to a joint list, ~~and~~recording the ~~Transfer~~trade ~~Agent~~price ~~will~~and ~~incur~~size nofor ~~liability~~each ~~for~~transaction. ● The list is partitioned into a number of equally sized, twelve individual time intervals of five-minute length. ● For each of the ~~refusal~~twelve partitions separately, ~~in good~~the ~~faith~~volume-weighted median trade price is calculated from the trade prices and sizes of all Relevant Transactions, toi.e., ~~make~~across ~~transfers~~all ~~which~~Constituent itBitcoin Platforms. A volume-weighted median differs from a standard median in that a weighting factor, in ~~its~~this ~~judgment~~case trade size, ~~deems~~is ~~improper~~factored orinto ~~unauthorized~~the calculation. ● The Index is then given by the equally-weighted average of the volume-weighted medians of all partitions.

Fees paid to the Transfer Agent are an Assumed Expense.

The Custodian

Coinbase Custody serves as our qualified digital asset custodian for purposes of Section 206(4)-2(d)(6) under the Advisers Act. On February 4, 2022, the Trust entered into the Custodial Services Agreement with the Custodian. Prior to March 10, 2022, FDAS served as our digital asset custodian until April 10, 2022. On March 10, 2022, the Trust transferred its custodied digital assets from FDAS to Coinbase Custody.

Coinbase Custody and Coinbase Pro are wholly-owned subsidiaries of Coinbase Global, Inc. (“Coinbase Global”). Coinbase Global and its subsidiaries provide end-to-end financial infrastructure and technology for the crypto-economy. Coinbase Custody is an independently capitalized New York State limited purpose trust company that was chartered in October 2018. Coinbase Custody is a fiduciary under § 100 of the New York Banking Law and is add qualified custodian for purposes of Section 206(4)-2(d)(6) of the Advisers Act. As a New York State limited purpose trust company, Coinbase Custody is subject regulation, examination and supervision by the New York State Department of Financial Services (“NYDFS”). NYDFS’s regulations impose various compliance requirements, including operational limitations related to the nature of crypto assets held under custody, capital requirements, BSA and anti-money laundering program requirements, affiliate transaction limitations, and notice and reporting requirements. Coinbase Custody offers its clients access to secure, institutional-grade offline digital asset storage. As of December 31, 2022, Coinbase Global held approximately $86 billion in fiat and digital assets on its platform, the majority of which were comprised of Bitcoin, Ethereum and other crypto assets. According to publicly available information, Bitcoin represented 43%, 40% and 70% of the assets held or managed in digital wallets on Coinbase’s Global platform, including its custody services, for the years ended December 31, 2022, 2021 and 2020, respectively. The cold storage technology that Coinbase Custody uses to custody digital assets, such as Bitcoin, shares the same framework of the technology that Coinbase Global, and its predecessor, Coinbase, Inc., have used since 2012, which is continuously improved to meet cyber and physical security best practices.

Coinbase Custody is authorized to serve as the Trust’s custodian under the Trust Agreement and pursuant to the terms and provisions of the Custodial Services Agreement. The Trust’s digital assets are held in segregated cold storage accounts with the Custodian, and as a result, the digital assets are segregated from both (i) the proprietary property of Coinbase Custody and its affiliates, and (ii) the assets of any other Coinbase Custody client.

Information provided about Coinbase Custody and its parent company is primarily derived from Coinbase Global’s publicly available information, including filings it makes with the SEC. Although the Trust believes this information is reliable, the Trust has not independently verified the accuracy of this information.

The Index does not include any futures prices in its methodology. A “Relevant Transaction” is any cryptocurrency versus U.S. dollar spot trade (the “Relevant Pair”) that occurs during the “TWAP Period” on a Constituent Bitcoin Platform in the BTC/USD pair that is reported and disseminated by a Constituent Bitcoin Platform through its publicly available application programming interface and observed by the Index Administrator. “TWAP” refers to the Time Weighted Average Price period for which trade data is observed, or the 60-minute observation window between 3:00 p.m. and 4:00 p.m., New York time.

~~Theorem~~An ~~Fund~~oversight ~~Services~~function ~~serves~~is asimplemented by the Index Administrator in seeking to ensure that the Index is administered through the Index Administrator’s codified policies for Index integrity. The Index Administrator’s ~~has~~codified ~~offices~~policies athave ~~141~~been W.developed to ~~Jackson~~ensure ~~Blvd~~compliance ~~Suite~~with ~~4120,~~the ~~Chicago~~UK BMR regulations, ILwhich ~~60604~~the Index Administrator is subject to as a Registered Benchmark. The codified policies include the following:

~~The Administrator~~● isInput ~~generally~~Data ~~responsible~~Policy: ~~for~~The ~~the~~Input ~~day-to-day~~Data ~~administration~~Policy ofgoverns the ~~Trust,~~data ~~including~~that ~~keeping~~ the ~~Trust’s~~Index ~~operational records.~~Administrator ~~The~~uses ~~Administrator’s~~in ~~principal~~benchmark ~~responsibilities~~determinations. ~~include~~● Surveillance Policy: ~~(i)~~The ~~valuing~~Surveillance ~~the~~Policy ~~Trust’s~~governs ~~Bitcoin~~Benchmark ~~and~~Surveillance, ~~calculating~~which ~~the NAV~~is ~~per~~accomplished ~~Unit;~~through ~~(ii)~~a ~~supplying~~series ~~pricing~~of ~~information~~measures tothat are the ~~Sponsor~~product ~~for~~of an analysis of the ~~Trust~~Benchmark Administrator’s ~~website;~~methodologies ~~(iii)~~and ~~receiving~~their ~~and~~susceptibility ~~reviewing~~to ~~reports on~~manipulation. ~~the~~● ~~custody~~Conflicts of ~~and~~Interest ~~transactions~~Policy: inThe ~~cash~~Conflicts ~~and~~of ~~Bitcoin~~Interest ~~from~~Policy governs the ~~Cash~~measures ~~Custodian~~by ~~and~~which ~~Trust~~the Index Administrator identifies, ~~respectively~~records, mitigates, and ~~taking~~escalates ~~such~~potential ~~other~~and ~~actions in~~actual ~~connection~~conflicts ~~with~~of interest that might impact the ~~custody~~integrity of ~~cash~~the asbenchmarks. ~~the~~● ~~Sponsor~~Governance ~~instructs;~~& ~~and~~Oversight ~~(iv)~~Framework: ~~accounting~~This ~~and~~framework ~~other~~sets ~~fund~~forth ~~administrative~~the ~~services.~~measures ~~The~~ by which the Index Administrator ~~also~~manages ~~provides~~the ~~know~~benchmark ~~your~~life ~~customer,~~cycle ~~anti-money~~including ~~laundering~~the relevant junctures where Oversight Committee notification, escalation, review and ~~Office~~resolution ofis ~~Foreign~~relevant ~~Assets~~and ~~Control~~required ~~(“OFAC”) compliance~~including ~~check~~the ~~services~~manner in which the Benchmark Administrator identifies risks to benchmark integrity and the ~~Trust~~processes and ~~Sponsor~~procedures it follows to mitigate and eliminate such risks.

The Index Administrator’s ~~will~~compliance ~~liaise~~ with ~~the~~such ~~Trust’s~~regulations ~~legal,~~has ~~accounting~~been ~~and~~subject ~~other~~to ~~professional~~a ~~service~~Reasonable ~~providers~~Assurance Audit under the ISAE 3000 standard as ~~needed~~of September 12, 2024, which is publicly available.

The ~~Administrator~~Index ~~will~~is ~~keep~~also ~~proper~~subject ~~books~~to ofoversight ~~registration~~by ~~and~~the ~~transfer~~Oversight ofCommittee. ~~Units~~The atOversight ~~its~~Committee ~~office~~was ~~located~~jointly inestablished ~~New~~by ~~York~~the orIndex ~~such office as~~Administrator itand ~~may~~the ~~subsequently~~Chicago ~~designate.~~Mercantile ~~These~~Exchange ~~books~~(“CME”) and ~~records~~is ~~are~~comprised ~~open~~of tofive ~~inspection~~members, byincluding ~~any~~two ~~person~~ who ~~establishes~~are torepresentatives ~~the~~of ~~Sponsor’s~~CME, ~~satisfaction~~one ~~that such~~who ~~person~~ is a ~~Unitholder~~representative atof ~~all~~the ~~reasonable~~Index ~~times~~Administrator, ~~during~~and ~~the~~two ~~usual~~others, ~~business~~who ~~hours~~bring ofexpertise ~~the~~and ~~Sponsor~~industry knowledge relating to benchmark determination, issuance, and operations. The ~~Sponsor~~Oversight ~~will~~Committee’s ~~keep~~Founding aCharter ~~copy~~and quarterly meeting minutes are publicly ofavailable. ~~the~~The ~~Trust~~Oversight ~~Agreement~~Committee meets on ~~file~~at inleast ~~its~~a ~~office~~quarterly ~~which~~basis, ~~will~~and bemore ~~available~~frequently ~~for~~as ~~inspection~~needed, onto ~~reasonable~~review ~~advance~~and ~~notice~~make atdeterminations of cryptocurrency pricing products, including the Index, and attend to all ~~reasonable times~~other ~~during~~matters ~~its~~relating ~~usual~~to ~~business~~such ~~hours~~determination, byincluding ~~any~~their definition, ~~Unitholder~~setting, scope, methodology, and distribution.

~~Overview~~A platform must meet a set of ~~The~~predefined ~~Bitcoin~~criteria ~~Industry~~to be approved by the Oversight Committee, and ~~Market~~the operation of existing Constituent Platforms are also monitored against the same criteria:

~~Introduction~~1. toThe ~~Bitcoin~~platform’s ~~and~~spot trading volume of the ~~Bitcoin~~Relevant ~~Network~~Pair for an index must meet the minimum thresholds as detailed below for it to be admitted as a constituent platform:

~~“Bitcoin” is~~ a ~~digital asset and the first so-called cryptocurrency~~. ItThe ~~uses~~average ~~peer-to-peer~~daily ~~technology~~volume ~~and cryptographic security features to decentralize control of~~ the ~~overall~~venue ~~Bitcoin~~would ~~computer~~have ~~network~~contributed ~~(the~~during ~~“Bitcoin Network”), and blockchain technology to ensure~~ the ~~secure~~observation ~~transfer~~window ~~and authenticity of each Bitcoin. Bitcoin are stored in digital wallets and can be used to pay~~ for ~~goods~~ ~~and services. They can also be purchased, sold and traded on websites that facilitate~~ the ~~transfer~~Index of ~~Bitcoin~~the inRelevant ~~exchange for~~Pair ~~government-issued~~exceeds ~~currencies~~3% or other cryptocurrencies, traded on cryptocurrency exchanges and transferred in individual end-user-to-end-user transactions under a barter system. Bitcoin benefits include security, decentralization, low transaction costs compared to many other payment systems, the potential for ~~universal~~two ~~use~~consecutive ~~and~~calendar ~~the ability to divide a single Bitcoin by up to eight decimal places~~quarters.

~~A blockchain~~2. isThe aplatform ~~decentralized,~~has ~~distributed~~policies ~~ledger~~to ~~that~~ensure ~~records~~fair ~~the~~and ~~provenance~~transparent ofmarket ~~digital~~conditions ~~assets.~~at ~~The ledger is public and accessible to~~ all, ~~and~~times ~~portions~~ and ~~copies~~has ofprocesses ~~it are stored~~ in aplace ~~decentralized~~to ~~manner~~identify onand ~~the~~impede ~~several~~illegal, ~~thousand~~unfair ~~computers~~or ~~comprising~~manipulative ~~the~~trading ~~Bitcoin Network~~practices. ~~Transaction~~3. ~~data~~The isplatform ~~permanently~~does ~~recorded~~not inimpose ~~data~~undue ~~files~~barriers ~~called~~to ~~“blocks,”~~entry ~~which~~or ~~reflect~~restrictions ~~transactions~~on ~~that~~market ~~have been~~participants, ~~recorded~~ and ~~authenticated~~utilizing bythe ~~Bitcoin~~platform ~~Network~~does ~~participants~~not ~~known~~expose asmarket ~~“miners.”~~participants ~~Each newly recorded block of transactions refers back~~ to ~~and~~undue ~~“connects”~~credit ~~with~~risk, ~~the~~operational ~~immediately~~risk, ~~preceding~~legal ~~recorded~~risk ~~block~~or inother ~~the~~risks. ~~ledger~~4. ~~Each~~The ~~new~~platform ~~block~~complies ~~records~~with ~~outstanding Bitcoin~~applicable ~~transactions,~~law and ~~outstanding~~regulations, ~~transactions~~including, ~~are~~but ~~settled~~not ~~and~~limited ~~validated~~to, ~~through~~capital ~~such~~markets ~~recording.~~regulations, ~~The~~money ~~Blockchain~~transmission isregulations, ~~designed to~~client ~~represent~~money acustody ~~complete~~regulations, ~~transparent,~~KYC ~~secure~~regulations and ~~unbroken~~anti-money ~~history~~laundering ofregulations. ~~all the transactions that have occurred on the Bitcoin Network~~5. The ~~Bitcoin~~platform ~~Network~~cooperates ~~software~~with ~~source~~inquiries ~~code~~and ~~includes~~investigations ~~the protocols that govern the creation, or “mining,”~~ of ~~new~~regulators ~~Bitcoin~~ and the ~~cryptographic~~Index ~~system~~Administrator ~~that~~upon ~~secures~~request and ~~verifies~~must ~~Bitcoin~~execute ~~transactions.~~data ~~New~~sharing ~~Bitcoin~~agreements ~~are~~with ~~allocated~~CME ~~by the Bitcoin Network protocol through the mining process, subject to a well-known issuance schedule contained within the protocol~~Group.

The Blockchain constitutes a record of every Bitcoin, every Bitcoin transaction (including the mining of new Bitcoin) and every Bitcoin address associated with a quantity of Bitcoin. The Bitcoin Network and Bitcoin Network software programs can interpret the Blockchain to determine the exact Bitcoin balance, if any, of any public Bitcoin address listed in the Blockchain as having taken part in a transaction on the Bitcoin Network. Bitcoin Network miners engage in a set of prescribed, complex mathematical calculations in order to add a block to the Blockchain and thereby confirm Bitcoin transactions included in that block’s data. In addition to confirming the authenticity of recent transactions and referencing the preceding block, each block also contains an answer to a mathematical problem. Miners generate potential answers to this mathematical problem at a rapid rate, effectively searching for a correct answer via computational trial-and-error. New blocks cannot be submitted to the network without a correct answer to the mathematical problem. The mathematical problem in each block is extremely difficult to solve, but once a valid solution is found, it is very easy for the rest of the network to confirm that the solution is correct. Once the mathematical problem has been solved, the miner may then transmit a copy of the newly-formed block to peers on the Bitcoin Network, which then update their respective copies of the Blockchain by appending the new block. A new block that is added to the Blockchain serves to take recent, but as yet unconfirmed, transactions and verify that none are fraudulent, and the miner that first solves such block receives a reward of a fixed number of Bitcoin for the miner’s effort. In addition to the block reward, end users pay fees as an incentive for a miner to confirm their transactions in newly created blocks.

~~History~~Following admittance, a Constituent Platform must demonstrate that it continues to fulfill criteria two through five. In cases where a Constituent Platform’s average daily contribution falls below three percent for the Index, then the continued inclusion of ~~Bitcoin~~the platform as a Constituent Platform to the Relevant Pair shall be assessed by the Oversight Committee. The Constituent Platforms have changed over time. For example, the BRR previously included OKCoin.com (HK) and Bitfinex, both of which were removed in April 2017 due to trading restrictions. As of December 31, 2025, the Constituent Platforms include:

~~The Bitcoin~~● ~~Network~~Crypto.com ~~was~~Exchange: ~~initially~~Crypto.com ~~contemplated~~Exchange inis the product name of FORIS DAX, a ~~white~~Singapore ~~paper~~based company that ~~also~~is ~~described~~licensed ~~Bitcoin~~as a Major Payment Institution by the Monetary Authority of Singapore. ● Bitstamp: A U.K.-based platform registered as a money services business with FinCEN and licensed as a virtual currency business under the ~~operating~~NYDFS ~~software~~BitLicense toas ~~govern~~well as money transmitter in various U.S. states. It is also regulated as a Payments Institution within the ~~Bitcoin~~ ~~Network~~European Union and is registered as a Crypto Asset business with the UK FCA. ~~The~~● ~~white~~Bullish: ~~paper~~A ~~was~~Gibraltar-based ~~purportedly~~platform ~~authored~~regulated by ~~Satoshi~~the ~~Nakamoto;~~Gibraltar ~~however,~~Financial noServices ~~individual~~Commission (‟GFSCˮ) operated by Bullish (GI) Limited as a DLT. ● Coinbase: A U.S.-based platform registered as a money services business with ~~that~~FinCEN ~~name~~and ~~has~~licensed ~~been~~as ~~reliably identified~~a virtual currency business under the NYDFS BitLicense as ~~Bitcoin’s~~well ~~creator~~as a money transmitter in various U.S. states. Subsidiaries operating internationally are further regulated as an e-money provider (Republic of Ireland, Central Bank of Ireland) and ~~the~~Major ~~general~~Payment ~~consensus~~Institution is(Singapore, Monetary Authority of Singapore). ● Kraken: A U.S.-based platform that is registered as a money services business with FinCEN in various U.S. states, Kraken is registered with the ~~name~~FCA as a Crypto Asset Business and is authorized by the Central Bank of Ireland as a ~~pseudonym~~virtual ~~for~~asset service provider. Kraken also holds a variety of other licenses and regulatory approvals, including from the ~~actual~~Canadian ~~inventor~~Securities orAdministrators. ~~inventors~~● itBit: A U. ~~The~~S.-based ~~first~~platform ~~Bitcoin~~that ~~was~~is ~~created~~licensed inas ~~2009~~a ~~after~~virtual ~~Nakamoto~~currency ~~released~~business under the ~~Bitcoin~~NYDFS ~~Network~~BitLicense. ~~source~~It ~~code~~is (also registered with FinCEN as a money services business and is licensed as a money transmitter in various U.S. states. ● LMAX Digital: A Gibraltar based platform regulated by the ~~software~~GFSC as a DLT provider for execution and ~~protocol~~custody services. LMAX Digital does not hold a BitLicense and is part of LMAX Group, a U.K-based operator of a FCA regulated Multilateral Trading Facility and Broker-Dealer. ● Gemini: A U.S.-based platform that ~~created~~ is licensed as a virtual currency business under the NYDFS BitLicense. It is also registered with FinCEN as a money services business and ~~launched~~is licensed as a money transmitter in various U.S. states. It is also registered with the ~~Bitcoin~~FCA ~~Network)~~as a Crypto Asset Business.

~~Overview~~Once the Sponsor has actual knowledge of material changes to the Constituent Bitcoin Platforms used to calculate the Index, the Sponsor will ~~Network’s~~post ~~Operations~~an announcement with respect to such change on its website.

InThe ~~order~~eight toConstituent ~~own,~~Platforms ~~transfer~~that orcontribute ~~use~~transaction ~~Bitcoin~~data ~~directly on the Bitcoin Network (as opposed~~ to ~~through an intermediary, such as a custodian), a person generally must have internet access to connect to~~ the ~~Bitcoin~~Index ~~Network.~~with ~~Bitcoin transactions may be made directly between end-users without~~ the ~~need~~aggregate ~~for~~volumes atraded ~~third-party~~on ~~intermediary.~~their Torespective ~~prevent the possibility of double~~BTC-~~spending Bitcoin, a user must notify~~USD ~~the~~markets ~~Bitcoin~~over ~~Network of~~ the ~~transaction~~preceding byfour ~~broadcasting~~calendar ~~the~~quarters ~~transaction~~are ~~data~~listed ~~to its network peers. The Bitcoin Network provides confirmation against double-spending by memorializing every transaction~~ in the ~~Blockchain,~~table which is publicly accessible and transparent. This memorialization and verification against double-spending is accomplished through the Bitcoin Network mining process, which adds “blocks” of data, including recent transaction information, to the Blockchain.below:

Description of Bitcoin Transfers

Aggregate Trading Volume of BTC-USD Markets of Constituent Platforms
Period	Bitstamp		Bullish Global		Coinbase		Crypto.com*		Gemini		itBit		Kraken		LMAX Digital
2025 Q1		14,477,591,026		15,621,692,912		94,635,582,496		437,288,895		7,306,366,610		1,101,275,922		17,525,260,799		9,804,590,131
2025 Q2		10,585,362,523		9,065,766,963		62,097,548,243		60,060,401,437		4,607,793,882		908,793,981		12,383,175,403		7,867,820,828
2025 Q3		15,577,871,806		3,993,245,940		82,586,972,012		62,328,764,021		4,709,972,379		890,513,833		12,265,610,700		9,758,238,679
2025 Q4		23,272,669,351		9,557,076,628		78,293,912,816		105,086,222,287		3,964,106,275		1,037,472,441		18,126,225,065		10,668,812,131

Prior to engaging in Bitcoin transactions directly on the Bitcoin Network, a user generally must first install on its computer or mobile device a Bitcoin Network software program that will allow the user to generate a private and public key pair associated with a Bitcoin address commonly referred to as a “digital wallet.” The Bitcoin Network software program and the Bitcoin address also enable the user to connect to the Bitcoin Network and transfer Bitcoin to, and receive Bitcoin from, other users.

Each Bitcoin Network address, or digital wallet, is associated with a unique “public key” and “private key” pair. To receive Bitcoin, the Bitcoin recipient must provide its public key to the party initiating the transfer. This activity is analogous to a recipient for a transaction in U.S. dollars providing a routing address in wire instructions to the payor so that cash may be wired to the recipient’s account. The payor approves the transfer to the address provided by the recipient by “signing” a transaction that consists of the recipient’s public key with the private key of the address from where the payor is transferring the Bitcoin. The recipient, however, does not make public or provide to the sender its related private key.

Neither the recipient nor the sender reveal their private keys in a transaction, because the private key authorizes transfer of the funds in that address to other users. Therefore, if a user loses his private key, the user may permanently lose access to the Bitcoin contained in the associated address. Likewise, Bitcoins are irretrievably lost if the private key associated with them is deleted and no backup has been made. When sending Bitcoin, a user’s Bitcoin Network software program must validate the transaction with the associated private key. The resulting digitally validated transaction is sent by the user’s Bitcoin Network software program to the Bitcoin Network to allow transaction confirmation.

Some Bitcoin transactions are conducted “off-blockchain” and are therefore not recorded in the Blockchain. Some “off-blockchain transactions” involve the transfer of control over, or ownership of, a specific digital wallet holding Bitcoin or the reallocation of ownership of certain Bitcoin in a pooled-ownership digital wallet, such as a digital wallet owned by a Bitcoin exchange. In contrast to on-blockchain transactions, which are publicly recorded on the Blockchain, information and data regarding off-blockchain transactions are generally not publicly available. Therefore, off-blockchain transactions are not truly Bitcoin transactions in that they do not involve the transfer of transaction data on the Bitcoin Network and do not reflect a movement of Bitcoin between addresses recorded in the Blockchain. For these reasons, off-blockchain transactions are subject to risks as any such transfer of Bitcoin ownership is not protected by the protocol behind the Bitcoin Network or recorded in, and validated through, the blockchain mechanism.

Summary of a Bitcoin Transaction

In an on-chain transaction, the following circumstances must initially be in place: (i) the party seeking to send Bitcoin must have a Bitcoin Network public key, and the Bitcoin Network must recognize that public key as having sufficient Bitcoin for the transaction; (ii) the receiving party must have a Bitcoin Network public key; and (iii) the spending party must have internet access with which to send its spending transaction.

The receiving party must provide the spending party with its public key and allow the Blockchain to record the sending of Bitcoin to that public key. After the provision of a recipient’s Bitcoin Network public key, the spending party must enter the address into its Bitcoin Network software program along with the number of Bitcoin to be sent. The number of Bitcoin to be sent will typically be agreed upon between the two parties based on a set number of Bitcoin or an agreed upon conversion of the value of fiat currency to Bitcoin. Since every

~~computation~~The market onshare ~~the~~for ~~Bitcoin~~BTC-USD ~~Network~~trading ~~requires the payment~~ of ~~Bitcoin, including verification and memorialization of Bitcoin transfers, there is a transaction fee involved with~~ the ~~transfer,~~eight ~~which~~Constituent isPlatforms ~~based~~over ~~on computation complexity and not on~~ the ~~value~~past offour ~~the~~calendar ~~transfer~~quarters ~~and~~ is ~~paid~~shown byin the ~~payor~~table ~~with a fractional number of Bitcoin.~~below:

After the entry of the Bitcoin Network address, the number of Bitcoin to be sent and the transaction fees, if any, to be paid, will be transmitted by the spending party. The transmission of the spending transaction results in the creation of a data packet by the spending party’s Bitcoin Network software program, which is transmitted onto the decentralized Bitcoin Network, resulting in the distribution of the information among the software programs of users across the Bitcoin Network for eventual inclusion in the Blockchain.

Bitcoin Trading Platform Market Share of BTC-USD Trading
Period	Bitstamp			Bullish Global			Coinbase			Crypto.com			Gemini			itBit			Kraken			LMAX Digital
2025 Q1		9.00	%		9.71	%		58.81	%		0.27	%		4.54	%		0.68	%		10.89	%		6.09	%
2025 Q2		6.32	%		5.41	%		37.06	%		35.84	%		2.75	%		0.54	%		7.39	%		4.70	%
2025 Q3		8.11	%		2.08	%		42.99	%		32.44	%		2.45	%		0.46	%		6.38	%		5.08	%
2025 Q4		9.31	%		3.82	%		31.32	%		42.03	%		1.59	%		0.41	%		7.25	%		4.27	%

AsCF ~~discussed~~BENCHMARKS inLTD. ~~greater~~DATA ~~detail~~IS ~~below~~USED inUNDER ~~“—Creation~~LICENSE ofAS ~~New~~A ~~Bitcoin,”~~SOURCE ~~Bitcoin~~OF ~~Network~~INFORMATION ~~miners~~FOR ~~record~~THE ~~transactions~~TRUST’S ~~when they~~PRODUCTS. ~~solve~~CF ~~for~~BENCHMARKS ~~and~~LTD., ~~add~~ITS ~~blocks~~AGENTS AND ofLICENSORS ~~information~~HAVE toNO ~~the~~OTHER ~~Blockchain.~~CONNECTION ~~When~~TO aTHE ~~miner~~TRUST’S ~~solves~~PRODUCTS ~~for~~AND aSERVICES ~~block,~~AND itDO ~~creates~~NOT ~~that~~SPONSOR, ~~block~~ENDORSE, ~~which~~RECOMMEND ~~includes~~OR PROMOTE ANY ~~data~~OF ~~relating~~THE toTRUST’S ~~(i)~~PRODUCTS ~~the~~OR ~~solution~~SERVICES. toCF ~~the~~BENCHMARKS ~~block~~LTD., ~~(ii)~~ITS aAGENTS ~~reference~~AND toLICENSORS ~~the~~HAVE ~~prior~~NO ~~block~~OBLIGATION inOR ~~the~~LIABILITY ~~Blockchain~~IN toCONNECTION WITH ~~which~~THE ~~the~~TRUST’S ~~new~~PRODUCTS ~~block~~AND ~~is being~~SERVICES. ~~added~~CF ~~and~~BENCHMARKS ~~(iii)~~LTD., ~~transactions~~ITS ~~that~~AGENTS ~~have~~AND ~~occurred~~LICENSORS ~~but~~DO ~~have~~NOT ~~not~~GUARANTEE ~~yet~~THE ~~been~~ACCURACY ~~added~~AND/OR toTHE ~~the~~COMPLETENESS OF ~~Blockchain.~~ANY ~~The~~INDEX ~~miner~~LICENSED ~~becomes~~TO ~~aware~~THE ~~of outstanding,~~TRUST ~~unrecorded~~AND ~~transactions~~SHALL ~~through~~NOT ~~the~~HAVE ~~data~~ANY ~~packet~~LIABILITY ~~transmission~~FOR ~~and~~ANY ~~distribution~~ERRORS, ~~discussed~~OMISSIONS, ~~above~~OR INTERRUPTIONS THEREIN.

~~Upon~~Calculation ~~the addition~~ of a block included in the Blockchain, the Bitcoin Network software program of both the spending party and the receiving party will show confirmation of the transaction on the Blockchain and reflect an adjustment to the Bitcoin balance in each party’s Bitcoin Network public key, completing the Bitcoin transaction. Once a transaction is confirmed on the Blockchain, it is irreversible.NAV

~~Creation~~The Trust’s NAV per Share is calculated by multiplying the number of Bitcoin held by the Trust by the Index for such day, adding any additional receivables and subtracting the accrued but unpaid expenses and liabilities of the Trust. The Trust’s NAV per Share is calculated by dividing the Trust’s NAV by the number of Shares then outstanding. The Trust Administrator determines the price of the Trust’s Bitcoin by reference to the Index, which is published between 4:00 p.m. and 4:30 p.m., New York time, on every calendar day. The methodology used to calculate the Index price to value Bitcoin in determining the NAV of the Trust may not be deemed consistent with GAAP. As of December 31, 2025, the Trust’s NAV per Share was $28.12 based on the Index.

~~New~~The ~~Bitcoins~~Trust’s financial statements are ~~created~~prepared ~~through~~in accordance with the ~~mining~~Financial ~~process~~Accounting Standards Board Accounting Standards Codification Topic 820, “Fair Value Measurements and Disclosures” (“ASC 820-10”). ASC 820-10 determines fair value to be the price that would be received for Bitcoin in a current sale, which assumes an orderly transaction between market participants on the measurement date. ASC 820-10 requires the Trust to assume that Bitcoin is sold in its principal market to market participants or, in the absence of a principal market, the most advantageous market. Market participants are defined as ~~discussed~~buyers ~~below~~and sellers in the principal or most advantageous market that are independent, knowledgeable, and willing and able to transact. The Trust purchases Bitcoin directly from various counterparties, such as Coinbase and Anchorage, and does not itself transact in any Bitcoin markets. The purchase price of Bitcoin from our counterparties may vary significantly. The Trust looks to these counterparties when assessing entity-specific and market-based volume and the level of activity in the Bitcoin markets. The Trust determines the current value of Bitcoin by reference to the Bitcoin Market Price. The Bitcoin Market Price is determined based on the estimated fair market value price for Bitcoin, reflecting the execution price of Bitcoin on its principal market as determined by the Trust. Fair value pricing may require subjective determinations about the value of an asset or liability. Fair values determined as described herein may differ from quoted or published prices, or from prices that are used by others, for Bitcoin.

~~The~~It ~~Bitcoin Network~~ is ~~kept~~possible ~~running~~that ~~by computers all over~~ the ~~world.~~fair Invalue ~~order~~determined tofor ~~incentivize~~an ~~those~~investment ~~who~~may ~~incur~~be ~~the~~materially ~~computational~~different ~~costs of~~than ~~securing~~ the ~~network~~value ~~by validating transactions, there is a reward~~ that iscould ~~given~~be torealized ~~the~~upon ~~computer that was able to create~~ the ~~latest~~sale ~~block~~of onsuch ~~the chain~~investment. ~~Every~~Information 10that ~~minutes,~~becomes onknown ~~average, a new block is added~~ to the ~~Blockchain~~Trust ~~with~~or ~~the~~its ~~latest~~agents ~~transactions~~after ~~processed by~~ the ~~network,~~NAV ~~and~~has ~~the~~been ~~computer~~calculated ~~that~~on ~~generated~~a ~~this~~particular day ~~block~~ is ~~currently~~not ~~awarded~~used ~~6.25 Bitcoin. Due~~ to ~~the~~retroactively ~~nature~~adjust of the ~~algorithm for~~price ~~block generation, this process (generating a “proof-~~of~~-work”)~~ isan ~~guaranteed~~investment toor ~~be random. Over time, rewards are expected to be proportionate to~~ the ~~computational~~NAV ~~power~~determined ofearlier ~~each~~that ~~machine~~day.

~~The~~Additional ~~process~~Information byAbout ~~which Bitcoin is “mined” results in new blocks being added to~~ the Blockchain and new Bitcoin tokens being issued to the miners. Computers on the Bitcoin Network engage in a set of prescribed complex mathematical calculations in order to add a block to the Blockchain and thereby confirm Bitcoin transactions included in that block’s data.Trust

ToThe ~~begin mining, a user can download and run Bitcoin Network mining software, which turns the user~~Trust’s ~~computer~~Fees into a “node” on the Bitcoin Network that validates blocks. Each block contains the details of some or all of the most recent transactions that are not memorialized in prior blocks, as well as a record of the award of Bitcoin to the miner who added the new block. Each unique block can be solved and added to the Blockchain by only one miner. Therefore, all individual miners and mining pools on the Bitcoin Network are engaged in a competitive process of constantly increasing their computing power to improve their likelihood of solving for new blocks. As more miners join the Bitcoin Network and its processing power increases, the Bitcoin Network adjusts the complexity of the block-solving equation to maintain a predetermined pace of adding a new block to the Blockchain approximately every ten minutes. A miner’s proposed block is added to the Blockchain once a majority of the nodes on the Bitcoin Network confirms the miner’s work. Miners that are successful in adding a block to the Blockchain are automatically awarded Bitcoin for their effort and may also receive transaction fees paid by transferors whose transactions are recorded in the block. This reward system is the method by which new Bitcoin enter into circulation to the public.Expenses

The ~~Bitcoin~~Trust’s ~~Network~~only ordinary recurring expense is ~~designed~~the Management Fee. The Management Fee is accrued daily and paid monthly in ~~such~~arrears in aU.S. ~~way~~dollars ~~that~~only and is calculated by the ~~reward~~Trust ~~for~~Administrator. ~~adding~~The ~~new~~Trust ~~blocks~~Administrator calculates the Management Fee on a daily basis by applying the 0.49% annualized rate to the ~~Blockchain~~Trust’s ~~decreases~~NAV, ~~over~~as ~~time~~determined by reference to the Index. ~~Once~~To ~~new~~cover the Management Fee, ~~Bitcoin~~on ~~tokens~~the ~~are~~last noday ~~longer~~of ~~awarded~~each ~~for~~month, ~~adding~~the aSponsor ~~new~~or ~~block,~~its ~~miners~~delegate ~~will~~causes ~~only~~the ~~have~~Trust ~~transaction~~(or ~~fees~~its delegate) to ~~incentivize~~instruct ~~them,~~the ~~and~~Prime asExecution Agent to convert an amount of Bitcoin held by the Trust into U.S. dollars. The NAV of the Trust and the number of Bitcoin represented by a ~~result,~~Share declines iteach istime ~~expected~~the ~~that~~Trust ~~miners~~accrues ~~will~~the ~~need~~Management toFee beor ~~better~~any ~~compensated~~Trust ~~with~~expenses ~~higher~~not ~~transaction~~assumed ~~fees~~by tothe ~~ensure~~Sponsor. ~~that~~The ~~there~~Trust is ~~adequate incentive~~not responsible for ~~them~~paying any costs associated with the transfer of Bitcoin, to ~~continue~~or ~~mining~~from the Trust, in connection with paying the Management Fee or in connection with creation and redemption transactions.

Limits on Bitcoin Supply

The supply of new Bitcoin is mathematically controlled so that the number of Bitcoin grows at a limited rate pursuant to a pre-set schedule. The number of Bitcoin awarded for solving a new block is automatically halved after every 210,000 blocks are added to the blockchain. The initial block reward when the Bitcoin Network was introduced in 2009 was 50 Bitcoin per block. That number has and will continue to halve approximately every four years until approximately the year 2140, when it is estimated that block rewards will go to zero. The most recent halving occurred on May 11, 2020, which reduced the block reward from 12.5 to 6.25 Bitcoin. This deliberately controlled rate of Bitcoin creation means that the number of Bitcoin in existence will increase at a controlled rate until the number of

As partial ~~Bitcoin~~consideration infor ~~existence~~its ~~reaches~~receipt of the ~~pre-determined~~Management 21Fee, ~~million~~the ~~Bitcoin.~~Sponsor Asbears the routine operational, administrative and other ordinary fees and expenses of the ~~date~~Trust, including the fees of ~~this~~the ~~Annual~~Trustee, ~~Report~~Trust Administrator, Fund Accountant, Transfer Agent, Custodians and, ~~approximately~~Listing ~~19.3~~Exchange ~~million~~fees, ~~Bitcoins~~SEC ~~are~~registration ~~outstanding~~fees, printing and mailing costs, tax reporting fees, audit fees, license fees and ordinary legal fees and expenses (the ~~date~~“Assumed ~~when~~Expenses”); provided, however, that the 21Trust ~~million~~shall ~~Bitcoin~~remain ~~limitation~~responsible ~~will~~for beany ~~reached~~certain isextraordinary expenses ~~estimated~~of the Trust, including, but not limited to, taxes and governmental charges, expenses and costs, expenses and indemnities related to beany extraordinary services performed by the ~~year~~Sponsor ~~2140~~(or any other service provider, including the Trustee) on behalf of the Trust to protect the Trust or the interests of Shareholders, and indemnification expenses (the “Extraordinary Expenses”).

~~Modifications~~If the Trust incurs any Extraordinary Expenses, the Sponsor or its delegate (i) will instruct the Bitcoin Custodian to withdraw from the Bitcoin account, on a monthly basis as needed, Bitcoin in such quantity as necessary to permit payment of such Extraordinary Expenses; ~~Protocol~~and (ii) cause the Trust (or its delegate) to convert such Bitcoin into U.S. dollars or other fiat currencies at the exchange rate at the time of conversion.

~~Because~~Intraday ~~the~~Indicative Bitcoin Network has no central authority, the implementation of a change in Bitcoin Network is achieved by users and miners downloading and running updated versions of the Bitcoin Network software. The Bitcoin Network protocol is built using open source software, allowing for any developer to review the underlying code and suggest changes. There is no official company or group that is responsible for making modifications to the Bitcoin Network, however, there are a number of individual developers that regularly contribute to a specific distribution of Bitcoin Network software dubbed “Bitcoin Core.” Significant changes to the Bitcoin Network protocol are typically accomplished through a so-called Bitcoin Improvement Proposal or BIP. Such proposals are generally posted on websites, and the proposals explain technical requirements for the protocol changes as well as reasons why the change should be accepted. If a significant proportion of Bitcoin Network users and miners decide to adopt a change to the Bitcoin Network that is not compatible with previous software, then this software will recognize and process transactions differently on a going-forward basis. If another significant proportion of Bitcoin Network users and miners decide not to adopt such change, then these two Bitcoin Network groups would not process transactions in the same way on a going-forward basis. In this scenario, the blocks recognized as valid by one group of users will be different from the blocks recognized as valid by the other group of users, which will cause transaction records to diverge, or “fork,” on a going-forward basis. If this were to occur, two separate Bitcoin Networks could result, one running the pre-modification software program and the other running the modified version (i.e., a second “Bitcoin” network). In the event of a permanent fork with two separate and incompatible Bitcoin Networks, the price movements of different versions of Bitcoin on different Bitcoin Networks may deviate. In such a case, the Sponsor will evaluate the characteristics of each Bitcoin Network to determine in its sole discretion which Bitcoin Network will provide exposure that best comports with the Trust’s investment objective. On August 1, 2017, the Bitcoin Network was forked by a group of developers and miners accepting changes to the Bitcoin Network software intended to increase transaction capacity. On October 25, 2017, the Bitcoin Network was forked by a group of developers accepting changes to the Bitcoin Network software intended to reduce the use of specialized hardware in the Bitcoin mining process. Blocks mined on these networks now diverge from blocks mined on the Bitcoin Network, which has resulted in the creation of new blockchains whose digital assets are referred to as “Bitcoin Cash” and “Bitcoin Gold,” respectively. The Bitcoin Network, the Bitcoin Cash network and the Bitcoin Gold network now operate as separate, independent networks. In mid-November of 2017, an additional protocol change labeled “Segwit2x,” which had substantial support from large numbers of Bitcoin users, was cancelled by its proponents shortly before it was due to be implemented. Multiple proposals for increasing the capacity of the Bitcoin Network still exist, and it is possible that one or more of these proposals could result in further network forks, which may become increasingly frequent.Value

In order to provide updated information relating to the Trust for use by Shareholders, the Trust publishes an intraday indicative value (“IIV”) using the CME CF Bitcoin ~~Value~~Real Time Index (“BRTI”). One or more major market data vendors provide an IIV updated every 15 seconds, as calculated by the Exchange or a third-party financial data provider during the Exchange’s Regular Market Session. The IIV is calculated by using the prior day’s closing NAV as a base and updating that value during the Regular Market Session to reflect changes in the value of the Trust’s NAV during the trading day.

~~Bitcoin~~The IIV’s ~~Exchange~~dissemination ~~Valuation~~during the Regular Market Session should not be viewed as an actual real time update of the NAV, which is calculated only once at the end of each trading day. The IIV is widely disseminated every 15 seconds during the Regular Market Session by one or more major market data vendors. In addition, the IIV is available through online information services.

~~The~~From ~~value~~time ofto ~~Bitcoin~~time, asthere ~~with~~may ~~most~~be ~~assets,~~intra-day isprice ~~influenced~~fluctuations byacross ~~several~~Bitcoin ~~factors~~platforms. However, ~~including~~they ~~the~~are ~~supply~~generally ofrelatively ~~and~~immaterial. These ~~demand~~variances ~~for~~usually ~~Bitcoin,~~stem ~~costs associated~~from ~~with~~small ~~mining~~changes ~~Bitcoin,~~in ~~rewards~~the ~~issued~~fee tostructures ~~miners~~on ~~for~~different ~~verifying~~Bitcoin ~~transactions,~~platforms ~~the~~or ~~number~~differences ofin ~~competing cryptocurrencies,~~administrative ~~how~~procedures ~~Bitcoin~~required ~~trades,~~to ~~regulations~~deposit ~~governing~~and ~~its~~withdraw ~~sale~~fiat ~~and~~currency ~~trade~~in ~~and~~exchange ~~the~~for ~~protocol~~Bitcoin ~~itself.~~and ~~Due~~vice toversa. ~~the~~The ~~dynamic~~greatest ~~nature~~variances ofare ~~these~~found ~~factors~~at as(i) ~~well~~smaller asplatforms ~~others,~~with ~~the~~relatively ~~value~~low oftransaction avolumes ~~Bitcoin~~where iseven ~~difficult~~small totrades ~~determine,~~can ~~and~~be ~~the~~large ~~price~~relative ofto a Bitcoin ~~can~~platform’s transaction ~~fluctuate~~volume ~~significantly~~ and ~~over~~ ~~short~~as ~~periods~~a ofresult ~~time.~~impact Inthe ~~all~~trading ~~events,~~price ~~benefits~~on ofthose ~~transacting~~platforms; inand (ii) Bitcoin ~~typically~~platforms ~~include~~that ~~low~~are ~~transaction~~inaccessible ~~costs, near-zero transportation costs and low-~~to~~-zero~~ ~~storage costs~~the Trust.

All aspects of the BRTI methodology are publicly available at the website of the provider CF Benchmarks (www.cfbenchmarks.com). The BRTI is calculated once per second, in real time by utilizing the order books of Bitcoin ~~Exchange~~- ~~Public~~U.S. dollar trading pairs operated by all Constituent ~~Market~~Platforms. ~~Data~~An “order bookˮ is a list of buy and sell orders with associated limit prices and sizes that have not yet been matched, that is reported and disseminated by CF Benchmarks Ltd., as the BRTI calculation agent. The order books are aggregated into one consolidated order book by the BRTI calculation agent. The mid-price volume curve, which is the average of the bid price-volume curve (which maps transaction volume to the marginal price per cryptocurrency unit a seller is required to accept in order to sell this volume to the consolidated order book) and the ask price-volume curve (which maps a transaction volume to the marginal price per cryptocurrency unit a buyer is required to pay in order to purchase this volume from the consolidated order book). The mid-price-volume curve is weighted by the normalized probability density of the exponential distribution up to the utilized depth (utilized depth being calculated as the maximum cumulative volume for which the mid spread-volume curve does not exceed a certain percentage deviation from the mid-price). The BRTI is then given by the sum of the weighted mid-price-volume curve obtained in the previous step.

OnTermination ~~each~~of ~~online Bitcoin exchange, Bitcoin is traded with publicly disclosed valuations for each executed trade, measured by one or more fiat currencies such as~~ the ~~U.S. dollar or the Euro. Over-the-counter dealers or market makers do not typically disclose their trade data.~~Trust

The Trust will dissolve if any of the following events occur:

	●	a U.S. federal or state regulator requires the Trust to shut down or forces the Trust to liquidate its Bitcoin or seizes, impounds or otherwise restricts access to Trust assets;

	●	the Trust is determined to be a “money services business” under the regulations promulgated by FinCEN under the authority of the BSA and is required to comply with certain FinCEN regulations thereunder, and the Sponsor has made the determination that dissolution of the Trust is advisable;

	●	the Trust is required to obtain a license or make a registration under any state law regulating money transmitters, money services businesses, providers of prepaid or stored value, virtual currency businesses or similar entities, and the Sponsor has made the determination that dissolution of the Trust is advisable;

~~Currently, there~~● ~~are~~any ~~several~~ongoing ~~Bitcoin~~event ~~exchanges~~exists ~~operating~~that ~~worldwide~~either ~~and~~prevents ~~online~~the ~~Bitcoin~~Trust ~~exchanges~~from ~~represent~~making or makes impractical the Trust’s reasonable efforts to make a ~~substantial~~fair ~~percentage~~determination of the Bitcoin ~~buying~~ ~~and~~Market ~~selling~~Price; ~~activity~~● ~~and~~any ~~provide~~ongoing ~~the~~event ~~most~~exists ~~data~~that ~~with~~either ~~respect~~prevents tothe ~~prevailing~~Trust ~~valuations~~from ofconverting ~~Bitcoins.~~or ~~These~~makes ~~exchanges~~impractical ~~include established~~the ~~exchanges~~Trust’s ~~such~~reasonable asefforts ~~BitStamp,~~to ~~Coinbase~~convert ~~Pro~~Bitcoin ~~and~~to ~~itBit,~~U.S. ~~which~~dollars; ~~provide~~● athe ~~number~~filing of ~~options~~a ~~for~~certificate ~~buying~~of ~~and~~dissolution ~~selling~~or ~~Bitcoins. The~~revocation ~~below~~of ~~table reflects~~ the ~~trading~~Sponsor’s ~~volume~~charter (~~in Bitcoin)~~ and ~~market~~the ~~share~~expiration of ~~the~~90 ~~BTC-U.S.~~days ~~dollar~~after ~~trading~~the ~~pair~~date of ~~each~~notice ofto the ~~Bitcoin exchanges~~Sponsor ~~included~~of inrevocation ~~the~~without ~~Index~~a asreinstatement of ~~January~~its 8,charter) ~~2023,~~or ~~using~~upon ~~data~~an ~~reported~~Event byof Withdrawal unless at the ~~Index~~time ~~Provider~~there asis ofat ~~January~~least 8,one ~~2023~~remaining ~~(Source: Coin~~Sponsor; ~~Metrics~~or ~~Bletchley~~● ~~Indexes~~the ~~(CMBI)~~Bitcoin ~~and~~Custodian CMresigns ~~Market~~or ~~Data~~is ~~Feed):~~removed without replacement.

Major Worldwide Bitcoin Exchanges included in the Index as of January 8, 2023	Volume (U.S. Dollars)		Market Share
Binance.us	$	51,467,858		17.63	%
BitStamp USA, Inc.		18,076,459		6.19	%
Bittrex, Inc.		2,919,505		1.00	%
Coinbase Global, Inc.		177,083,900		60.65	%
Gemini Trust Company, LLC		4,171,275		1.43	%
itBit		2,328,710		0.80	%
Kraken		35,906,771		12.30	%
Total BTC-U.S. dollar trading pair	$	291,954,478		100.00	%

The Sponsor may, in its sole discretion, dissolve the Trust if any of the following events occur:

~~The domicile,~~● ~~regulation and legal compliance of~~ the ~~Bitcoin~~SEC ~~exchanges~~determines ~~included~~that in the ~~Index varies. The~~ Trust is ~~not~~an ininvestment acompany ~~position to~~required ~~determine the extent~~ to ~~which~~be ~~the~~registered ~~Bitcoin~~under ~~exchanges included in~~ the ~~Index~~Investment ~~are~~Company inAct; ~~compliance~~● ~~with~~ the ~~regulatory~~CFTC ~~requirements, as~~determines ~~those~~that ~~exchanges are not affiliated with or managed by~~ the Trust or the Sponsor. Information regarding each Bitcoin exchange may be found, where available, on the websites for such Bitcoin exchanges, among other places. BAM Trading Services Inc., d/b/a, “Binance U.S.,” based in San Francisco, California, is ~~registered as~~ a ~~money~~commodity ~~services~~pool ~~business~~under ~~with~~ the ~~Financial~~Commodity ~~Crimes Enforcement~~Exchange ~~Network~~Act; ~~(“FinCEN”)~~● ~~and~~the ~~has~~Trust ~~obtained~~becomes ~~licenses~~insolvent ~~to engage in money transmission,~~ or ~~the~~bankrupt; ~~state~~● ~~equivalent, in~~all ~~the majority~~ of ~~U.S.~~the ~~states~~Trust’s ~~(see~~assets ~~https://www.binance.us/en/home).~~are ~~BitStamp~~sold; ~~USA,~~● ~~Inc.~~the ~~(“BitStamp”)~~determination ~~based in New York, New York, is a wholly-owned subsidiary~~ of ~~BitStamp~~the ~~Ltd.,~~Sponsor athat ~~Luxembourg-based exchange. BitStamp is registered as a money services business with FinCEN and, has obtained licenses to engage in money transmission, or~~ the ~~state~~aggregate ~~equivalent, in applicable U.S. states (see https://www.bitstamp.~~net~~/).~~ ~~Bittrex,~~assets ~~Inc.~~of ~~(“Bittrex”)~~the ~~based~~Trust in ~~Seattle,~~relation ~~Washington,~~to isthe ~~registered~~operating asexpenses aof ~~money~~the ~~services business~~Trust ~~with~~make ~~FinCEN~~it ~~and~~unreasonable ~~has~~or ~~obtained~~imprudent ~~licenses~~ to ~~engage~~continue inthe ~~money~~activities ~~transmission,~~of or the ~~state~~Trust; ~~equivalent,~~● inthe ~~applicable~~Sponsor ~~U.S.~~receives ~~states (see~~notice ~~https://bittrex.com/).~~from ~~Coinbase~~the ~~Global~~IRS isor afrom ~~U.S.-based~~counsel ~~exchange~~for ~~headquartered~~the inTrust ~~Wilmington,~~or ~~Delaware,~~the ~~and~~Sponsor isthat ~~registered~~the ~~as a~~Trust ~~money~~fails ~~services business with FinCEN and has obtained licenses~~ to ~~engage~~qualify infor ~~money transmission~~treatment, or ~~the~~will ~~state~~not ~~equivalent,~~be ~~in the majority of U.S. states (see https://www.coinbase.com/). Gemini Trust Company~~treated, ~~LLC~~as is a ~~New~~grantor ~~York limited purpose~~ trust ~~charter regulated~~under by the ~~NYDFS~~Internal ~~(see~~Revenue ~~https://www.gemini.com/).~~Code ~~itBit is a digital asset exchange and wholly-owned subsidiary~~ of ~~Paxos Trust Company~~1986, ~~LLC,~~as aamended; ~~New~~or ~~York~~● ~~limited~~if ~~purpose~~the ~~trust~~Trustee ~~company~~notifies ~~regulated by~~ the ~~NYDFS~~Sponsor ~~(see~~of ~~https://www.paxos.com/).~~the ~~Payward,~~Trustee’s ~~Inc.,~~election ~~d/b/a “Kraken,”~~to isresign aand ~~San~~the ~~Francisco,~~Sponsor ~~California-based~~does ~~exchange~~not ~~that~~appoint ~~is registered as~~ a ~~money~~successor ~~services~~trustee ~~business~~within ~~with~~60 ~~FinCEN and has obtained licenses to engage in money transmission~~days, or the ~~state~~Trust ~~equivalent,~~will ~~in the majority of U~~dissolve.~~S. states.~~

~~Under~~The ~~the~~death, ~~Bank~~legal ~~Secrecy~~disability, ~~Act~~bankruptcy, asinsolvency, ~~amended~~dissolution, byor ~~the~~withdrawal ~~Uniting~~of ~~and~~any ~~Strengthening~~Shareholder ~~America~~(as bylong ~~Providing~~as ~~Appropriate~~such ~~Tools~~Shareholder ~~Required~~is tonot ~~Intercept~~the ~~and~~sole ~~Obstruct~~Shareholder ~~Terrorism~~of ~~(“USA~~the ~~PATRIOT”~~Trust) ~~Act,~~shall ~~Bitcoin~~not ~~exchanges~~result ~~that~~in ~~are registered as money services businesses with~~ the ~~FinCEN,~~termination ~~a bureau~~ of the ~~U.S.~~Trust, ~~Department of the Treasury that is responsible for anti-money laundering~~ and ~~counter-terrorism financing~~such ~~(“AML”)~~Shareholder, ~~regulation~~his/her ~~and administration~~estate, ~~are~~custodian ~~required~~or topersonal representative ~~adopt~~shall ~~and~~have ~~implement~~no anright ~~AML program that is reasonably designed~~ to ~~prevent~~withdraw ~~the~~or ~~money~~value ~~services~~such ~~business~~Shareholder’s ~~from~~Shares. ~~being~~Each ~~used~~Shareholder ~~to facilitate money laundering~~ (and ~~the~~any ~~financing~~assignee ~~of terrorist activities.~~thereof) ~~The~~expressly ~~AML~~agrees ~~program~~that ~~must~~in ~~be commensurate with~~ the ~~risks~~event ~~posed~~of byhis ~~the location and size of~~death, ~~and~~he ~~the~~waives ~~nature~~on inbehalf ~~volume~~ of, ~~the~~himself ~~financial services~~and ~~provided~~his ~~by the money services business. The AML program~~estate, ~~which~~and ~~must~~he/she bedirects inthe ~~writing,~~legal atrepresentative of ahis ~~minimum~~estate ~~must incorporate policies~~ and ~~procedures~~any ~~and~~person ~~internal~~interested ~~controls~~therein ~~reasonably designed~~ to ~~ensure~~waive ~~compliance~~the ~~with~~furnishing ~~applicable~~of ~~AML~~any ~~regulations. These policies and procedures must~~inventory, ~~among~~accounting ~~other~~or ~~things,~~appraisal ~~include~~of ~~requirements~~the ~~for~~assets ~~(i)~~of ~~verifying customer identification, (ii) filing reports, (iii)~~the ~~creating~~Trust and ~~retaining~~any ~~records~~right ~~and (iv) responding~~ to ~~law~~an ~~enforcement~~audit ~~requests.~~or Inexamination ~~addition,~~of the ~~AML~~books ~~program~~of ~~must designate a compliance official to ensure day-to-day compliance with~~ the ~~program and FinCEN regulations. Further~~Trust, ~~the~~except ~~AML program must provide~~ for ~~education and/or~~such ~~training~~rights ofas ~~appropriate~~are ~~personnel~~set ~~concerning~~forth ~~their~~in ~~responsibilities~~Article ~~under~~VIII of the ~~AML~~Trust ~~program,~~Agreement ~~including~~relating ~~training in the detection of suspicious transactions~~ to the ~~extent~~books ~~that~~of ~~these~~account ~~transactions~~and ~~are~~reports ~~required~~of tothe ~~be reported~~Trust. Upon ~~The~~dissolution ~~AML~~of ~~program~~the ~~must~~Trust ~~also provide for independent review to monitor~~ and ~~maintain~~surrender ~~an adequate risk-based program. Money services businesses must also file specified~~of ~~reports~~Shares ~~with~~by ~~FinCEN~~the Shareholders, ~~including~~Shareholders ~~currency~~will ~~transaction~~receive ~~reports~~a ~~and~~distribution ~~suspicious~~in ~~activity transaction reports~~U.S. Indollars ~~addition,~~after ~~state~~the ~~agencies that~~Sponsor ~~license~~has ~~and~~paid ~~regulate~~or ~~money~~made ~~transmitter~~provision ~~businesses~~for the ~~may~~Trust’s ~~have their own separate AML compliance requirements~~obligations.

The Index Provider relies on its Market Selection Framework (https://coinmetrics.io/reference-rates-market-selection-framework/) to select constituent markets for the Index. The Market Selection Framework consists of 36 features which represent individual measurable properties that provide an indication of the suitability for a market to serve as an input data source, which are combined to form a market rating. The Index Provider’s Oversight Committee evaluates a number of qualitative and quantitative features, including features related toAmendments

The Sponsor may amend the Trust Agreement without the consent of any Shareholder if the amendment does not adversely affect the interests of the Shareholders or affect the allocation of profits and losses among the Shareholders or between the Shareholders and the Sponsor. Any amendment that adversely affects the rights of Shareholders, dissolves the Trust or makes any material change to the Trust’s basic investment policies or structure must be approved by the affirmative vote of Shareholders owning at least 50% of the outstanding Shares.

The Trust’s Service Providers

The Sponsor

The Trust’s Sponsor is Osprey Funds, LLC, a Delaware limited liability company formed on October 31, 2018. The Sponsor’s principal place of business is 777 Brickell Ave., Suite 500, Miami, FL 33131, and its telephone number is (914) 214-4174.

The Sponsor ~~the~~is ~~exchange’s~~neither ~~technology,~~an ~~legal~~investment ~~and~~adviser ~~compliance,~~registered ~~business~~with ~~model~~the SEC, ~~data~~nor ~~availability,~~a ~~price,~~commodity ~~and~~pool ~~volume. For~~operator ~~each~~registered ~~asset,~~with the ~~Committee~~CFTC, ~~selects~~and ~~the~~does ~~highest~~not act ~~quality~~in ~~markets~~either ~~using~~such acapacity ~~selection~~with ~~algorithm.~~respect ~~Detailed~~to ~~information~~the ~~about~~Trust, ~~all~~and of the 36Sponsor’s ~~features~~provision of services to the Trust is ~~contained~~not ingoverned by the ~~full~~Advisers ~~text~~Act ofor the ~~Market~~Commodity ~~Selection~~Exchange ~~Framework~~Act.

Since the Index Provider began calculating the index, the Index Provider has made one change to the constituent markets for the CMBI Bitcoin Index. On July 31, 2020, BitFlyer’s BTC-USD market was removed and Binance’s BTC-USD market was added. The ~~decision was made based~~ ~~on the results of the Index Provider~~Sponsor’s ~~Market~~experience ~~Selection Framework, volume analysis and empirical testing of data. According to the Index Provider,~~ in ~~determining~~crypto toasset ~~replace~~markets ~~BitFlyer’s~~is ~~BTC-USD~~evidenced ~~with~~by ~~Binance’s BTC-USD, the Index Provider ran the output from~~ its ~~Market~~history ~~Selection~~managing ~~Framework,~~private ~~which~~and ~~scored~~OTC-traded ~~all~~crypto ~~eligible~~funds ~~markets~~since ~~in its coverage universe according to a total of 36 qualitative and quantitative features~~2019. The ~~Index~~executive ~~Committee~~officers of the ~~Index~~Sponsor ~~Provider~~also ~~evaluated~~serve ~~the~~as ~~output.~~officers ~~Binance’s USD=BTC scored a market score~~ of ~~27.99~~the ~~as compared with BitFlyer~~Sponsor’s ~~BTC-USD~~affiliate, ~~which~~REX ~~scored~~Financial, aLLC ~~market score of 24.07. The Index Committee also reviewed the relative BTC-USD volumes on each of BitFlyer and Binance~~ (~~along~~together with ~~the other market in~~ its ~~coverage universe)~~ ~~from March 1~~subsidiaries, ~~2021~~“REX ~~through July 31~~Financial”), ~~2021.~~which ~~Binance’s~~has ~~BTC-USD~~been ~~volumes~~sponsoring ~~were~~and ~~consistently~~managing ~~higher~~ETFs ~~during~~and ~~that~~ETNs ~~time~~since ~~period~~2016. ~~Based on~~REX ~~these~~Financial ~~results,~~also manages the ~~Index Committee determined to replace BitFlyer’s BTC~~REX-~~USD~~Osprey ~~with~~suite ~~Binance’s~~of ~~BTC-USD~~crypto inETFs ~~the Index. The resulting changes were deemed to improve the robustness, accuracy~~ and ~~quality~~sponsors ofcertain ~~the~~T-REX ~~market~~leveraged ~~data~~ETFs that ~~supports~~focus ~~the~~on ~~determination of~~crypto ~~index levels~~assets. ~~The Index Provider backfilled historical values for the CMBI Bitcoin Index back to July 2011.~~

The ~~Trust’s~~Sponsor ~~principal~~arranged ~~market,~~for ~~and~~ the ~~most~~creation ~~liquid~~of ~~Bitcoin~~the ~~exchange~~Trust isand ~~Coinbase~~the ~~Pro.~~registration ~~Coinbase Pro, a wholly-owned subsidiary~~ of ~~Coinbase~~ ~~Global,~~the ~~Inc.~~Shares ~~(“Coinbase~~for ~~Global”),~~their ispublic ~~Coinbase~~offering ~~Global’s~~in ~~market~~the ~~for~~United ~~active,~~States ~~professional traders. Started~~and inthe ~~2012~~listing ~~(and~~of ~~known~~the ~~until~~Shares ~~2016~~on asthe ~~Coinbase~~Listing Exchange. ~~and~~As ~~from~~partial ~~2016-2018~~consideration asfor ~~Coinbase~~its ~~Digital~~receipt ~~Asset~~of ~~Exchange), Coinbase Pro is~~ the ~~most~~ ~~liquid U~~0.S.49% ~~market~~Management ~~for~~Fee ~~Bitcoin,~~from ~~with~~the ~~approximately~~Trust, the ~~46%~~Sponsor ofis ~~daily~~obligated ~~trading~~to ~~volume~~pay asthe ofAssumed ~~September 8, 2021~~Expenses.

~~Historically,~~The aSponsor ~~large~~is ~~percentage~~generally responsible for the day-to-day administration of the ~~global~~Trust ~~Bitcoin~~under ~~trading~~the ~~volume~~provisions ~~occurred~~of onthe ~~self-reported,~~Trust ~~unregulated~~Agreement. ~~Bitcoin~~The ~~exchanges~~Sponsor’s responsibilities ~~located~~include: in(i) ~~China.~~preparing and providing periodic reports and financial statements on behalf of the Trust for investors; ~~Throughout~~(ii) ~~2017~~selecting and monitoring the Trust’s service providers and from time to time engaging additional, ~~however~~successor or replacement service providers (including without limitation the Trust Administrator, the ~~Chinese~~Custodians, ~~government~~Transfer ~~took~~Agent ~~several~~and ~~steps~~Index Administrator); (iii) instructing the Bitcoin Custodian to ~~tighten~~withdraw ~~controls~~the onTrust’s Bitcoin ~~exchanges,~~as ~~culminating~~needed into ~~a ban~~pay onthe ~~domestic~~Management ~~cryptocurrency~~Fee; ~~exchanges~~(iv) inupon ~~November~~dissolution ~~2017~~of the Trust, ~~which~~distributing ~~forced~~the ~~such~~Trust’s ~~exchanges~~cash proceeds from the sale of the remaining Bitcoin to ~~cease~~the ~~their~~owners ~~operations~~of orrecord ~~relocate~~of the Shares; and (v) when applicable, establishing the principal market for GAAP valuation. AsIn addition, if there is a fork in the Bitcoin network after which there is a ~~result,~~dispute ~~reported~~as to which network resulting from the fork is the Bitcoin ~~trading~~network, ~~volume~~the onSponsor ~~Chinese~~has ~~exchanges~~the authority to select the network that it believes in good faith is ~~now~~the ~~substantially~~Bitcoin ~~lower~~network, ~~representing~~unless asuch deselection ~~minimis~~or ~~share~~authority ofwould otherwise conflict with the ~~global~~Trust ~~trade volume~~Agreement.

~~From~~The ~~time~~Sponsor todoes ~~time,~~not ~~there may be intra-day price fluctuations across Bitcoin exchanges. However~~store, ~~they are generally relatively immaterial. For example~~hold, ~~the~~or ~~variance~~maintain ofcustody ~~prices on Bitcoin exchanges with the highest transaction volumes on average is less than 2%. These variances usually stem from small changes in the fee structures on different Bitcoin exchanges~~ or ~~differences~~control inof administrative procedures required to deposit and withdraw fiat currency in exchange for Bitcoins and vice versa. The greatest variances are found at (i) smaller exchanges with relatively low transaction volumes where even small trades can be large relative to an exchange’s transaction volume and as a result impact the ~~trading price on those exchanges and (ii) exchanges that are inaccessible to the~~ Trust ~~because they do not meet the Trust~~’s ~~regulatory~~Bitcoin ~~requirements,~~but ~~and~~instead ~~as a result are accessed and used by a captured market or by parties that do not have regulatory or compliance requirements. Historically, the Trust~~ has ~~not~~entered ~~needed~~into ~~to make any changes in~~ the ~~determination of its principal market due to variances in pricing, although it changed its principal market to Coinbase~~Custodial ~~Pro~~Services onAgreement ~~May 18, 2021 to facilitate its compliance~~ with ~~GAAP.~~the ~~The Trust selected Coinbase Pro, among other~~ Bitcoin ~~markets,~~Custodian ~~because it~~to ~~provides~~facilitate the ~~greatest~~security ~~liquidity, with approximately 50%~~ of ~~daily~~the ~~trading~~Trust’s ~~volume as of February 27, 2023~~Bitcoin.

The Sponsor ~~Index~~may transfer all or substantially all of its assets to an entity that carries on the business of the Sponsor if at the time of the transfer the successor assumes all of the obligations of the Sponsor under the Trust Agreement. In such an event, the Sponsor will be relieved of all further liability under the Trust Agreement.

The ~~Index~~Management Fee is apaid ~~U.S.~~by ~~dollar-denominated~~the ~~composite~~Trust ~~reference~~to ~~rate for~~ the ~~price~~Sponsor ofas ~~Bitcoin.~~compensation ~~The~~for ~~Index~~services isperformed ~~designed~~under tothe ~~(1)~~Trust ~~mitigate~~Agreement ~~instances of~~and ~~fraud,~~as ~~manipulation~~partial ~~and~~consideration for ~~other~~the ~~anomalous~~Sponsor’s ~~trading~~agreement ~~activity,~~to ~~(2)~~pay ~~provide~~the aspecified ~~real~~Sponsor-~~time,~~paid ~~trade-weighted~~Expenses ~~fair value~~ of ~~Bitcoin~~the ~~and (3) appropriately handle and adjust for non-market related events~~Trust.

The ~~Index was launched on January 1, 2020, with a first value date and base date of July 18, 2010. The constituent market closing prices are not materially different from the Index prices.~~Trustee

~~Constituent~~CSC Delaware ~~Exchange~~Trust ~~Selection~~Company serves as trustee of the Trust under the Trust Agreement. The Trustee has its principal office at 251 Little Falls Drive, Wilmington, Delaware 19808. The Trustee is unaffiliated with the Sponsor. A copy of the Trust Agreement is available for inspection at the Sponsor’s principal office, identified above.

The Trustee ~~method~~is byappointed ~~which~~ to serve as the ~~Index~~trustee ~~Provider~~of ~~selects~~the ~~constituent~~Trust ~~markets~~in the State of Delaware for ~~its~~the ~~indexes~~sole ispurpose ~~contained~~of insatisfying the requirement of Section ~~3.1~~3807(a) ~~Constituent~~of ~~Market~~the ~~Eligibility~~DSTA ~~Criteria in~~that the ~~Index~~Trust ~~Provider’s~~have ~~CMBI~~at ~~Single~~least ~~Asset~~one ~~Series~~trustee ~~Methodology,~~with ~~available~~a atprincipal ~~https://cmbi-indexes~~place of business in the State of Delaware.~~coinmetrics.io/cmbibtc.~~ The ~~constituent~~duties ~~markets~~of ~~for~~the ~~CMBI~~Trustee ~~indexes~~ are ~~derived~~limited ~~from~~to ~~the~~(i) ~~constituent~~accepting ~~markets~~legal ~~for~~process served on the CMTrust ~~Reference~~in ~~Rates,~~the ~~available~~State atof ~~https://coinmetrics.io/wp-content/uploads/2021/05/reference-rates-methodology.pdf,~~Delaware; and (ii) the execution ~~which~~of inany ~~turn~~certificates ~~evaluates~~required ~~markets~~to ~~traded~~be onfiled ~~digital~~with ~~asset~~the ~~exchanges~~Delaware asSecretary ~~potential~~of ~~input~~State ~~data~~which ~~sources~~the ~~using~~Trustee ~~CMBI’s~~is ~~Market~~required ~~Selection Framework~~to execute under the DSTA. To ~~The~~the ~~framework~~extent ~~consists~~that, ofat alaw ~~fully~~or ~~systematized~~in ~~process~~equity, ~~for~~the ~~evaluating~~Trustee ~~markets.~~has Induties ~~this~~(including ~~framework,~~fiduciary aduties) ~~market~~and ~~refers~~liabilities relating thereto to the aTrust ~~specific~~or ~~traded~~the ~~asset~~Shareholders, ~~pair~~such onduties aand ~~specific~~liabilities ~~exchange.~~will ~~Although~~be replaced by the ~~Trust~~duties ~~believes~~and ~~that~~liabilities of the ~~information~~Trustee ~~provided~~expressly byset forth in the ~~Index~~Trust ~~Provider~~ Agreement. The Trustee has no obligation to supervise, nor is ~~reliable~~it liable for, the ~~Trust~~acts ~~has~~or ~~not~~omissions ~~independently~~of ~~verified~~ the ~~accuracy~~Sponsor, ofTransfer Agent, ~~this~~Custodian ~~information~~or any other person.

Neither the Trustee, either in its capacity as trustee or in its individual capacity, nor any director, officer or controlling person of the Trustee is, or has any liability as, the issuer, director, officer or controlling person of the issuer of Shares. The Trustee’s liability in connection with the issuance and sale of Shares is limited solely to the express obligations of the Trustee as set forth in the Trust Agreement.

The Trustee has not prepared or verified, and will not be responsible or liable for, any information, disclosure or other statement in this Annual Report or in any other document issued or delivered in connection with the sale or transfer of the Shares.

The Trustee is permitted to resign upon at least 60 days’ notice to the Trust. The Trustee is compensated by the Sponsor and indemnified by the Sponsor and the Trust against any expenses it incurs relating to or arising out of the formation, operation or termination of the Trust, or the performance of its duties pursuant to the Trust Agreement except to the extent that such expenses result from gross negligence, willful misconduct or bad faith of the Trustee. The Sponsor has the discretion to replace the Trustee.

~~The Market Selection~~Fees ~~Framework~~paid ~~consists~~to ~~of 36 features which represent individual measurable properties that provide an indication of~~ the ~~suitability for~~Trustee aare ~~market to serve as~~ an ~~input~~Assumed ~~data source, which are combined to form a market rating~~Expense. ~~The Market Selection Framework evaluates markets based on the following criteria:~~

●The Sponsor ~~Technology: An assessment of whether the technology infrastructure of the market’s exchange provides sufficient availability~~ and ~~reliability~~its ~~for~~affiliates ~~input~~may ~~data~~from collection. Evaluates whether the exchange offers a REST API, Websocket feed, or FIX API suitable for data collection. Evaluates the performance of the API in terms of reliability and latency. ● Legal and Compliance: An assessment of whether the market’s exchange complies with laws and regulations. Evaluates the exchange’s legal risk exposure, and whether it adheres time-to-time ~~regulatory~~purchase best practices. Evaluates whether the exchange has publicly disclosed trading policies, uses market surveillance technology, and complies with national regulatory organizations, and enforces KYC and AML requirements. Evaluates whether the exchange has functioning fiat and cryptocurrency withdrawals processed within a normal timeframe. Evaluates whether a data sharing license can be executed with the exchange. ● Business Model: An assessment of the market’s exchange with respect to its business model, including its fee structure and asset listing standards. ● Data Availability: An assessment of the available data the market’s exchange offers for the given asset, including the number of markets where the given asset is the base currency, whether the markets are quoted in fiat currencies or ~~other~~sell ~~cryptocurrencies,~~Shares ~~and the type of markets offered. ● Price: An assessment of the quality of the market’s price data, including testing~~ for ~~the~~their ~~occurrence~~own ~~of price outliers and impactful price deviations from other markets~~account, ~~and implementing tests that determine whether the market functions~~ as an ~~active~~agent market in the underlying asset and are anchored by observable transactions entered into at arm’s length between buyers and sellers. ● Volume: An assessment of the quality of the market’s volume data, including testing for ~~manipulated~~their ~~volume~~customers ~~figures,~~ and implementing tests that determine whether the market functions as an active market in the underlying asset and are anchored by observable transactions entered into at arm’s length between buyers and sellers. The size of the exchange’s markets is also considered. ● Order Book: An assessment of the quality of the market’s order book data, including tests for accounts ~~manipulated~~over ~~orders,~~which ~~and~~they ~~implementing~~exercise ~~tests~~investment ~~that determine whether the market functions as an active market in the underlying asset and are anchored by observable transactions entered into at arm’s length between buyers and sellers~~discretion. ~~The liquidity of the market is also considered.~~

~~For each asset, the~~The ~~Index~~Trust Provider selects the highest quality markets using a rating algorithm and a selection algorithm. Detailed information is contained in the full text of the Market Selection Framework, available at https://coinmetrics.io/wp-content/uploads/2021/04/reference-rates-market-selection-framework.pdf.Administrator

~~The Coin Metrics Index Committee reviews the constituent markets from the CM Reference Rates to determine the constituent markets for CMBI’s indexes~~U.S. ~~This~~Bank ~~review~~Global ~~applies~~Fund ~~considerations~~Services ~~surrounding~~serves ~~the~~as ~~investability of each of~~ the ~~markets~~Trust ~~and takes into consideration all the available data~~Administrator. The ~~Coin~~Trust ~~Metrics~~Administrator ~~Oversight~~has ~~Committee~~offices ~~reviews~~at ~~these~~615 ~~decisions~~E. InMichigan ~~the case of the CMBI Bitcoin Index~~Street, ~~the constituent markets~~Milwaukee, ~~are~~WI ~~identical to the constituent markets for CMBI’s Bitcoin reference rate~~53202.

~~Determination~~The Trust Administrator is generally responsible for the day-to-day administration of the ~~Index~~Trust, ~~Price~~including keeping the Trust’s operational records. The Trust Administrator’s principal responsibilities include: (1) valuing the Trust’s Bitcoin and calculating the NAV per Share; (2) supplying pricing information to the Sponsor for the Trust’s website; (3) receiving and reviewing reports on the custody of and transactions in cash and Bitcoin from the Cash Custodian and Trust, respectively, and taking such other actions in connection with the custody of cash as the Sponsor instructs; and (4) accounting and other fund administrative services. The Trust Administrator also provides know your customer, anti-money laundering, and OFAC compliance check services to the Trust and Sponsor. The Trust Administrator is also responsible for various accounting services such as portfolio accounting, expense accrual and payment, trust valuation and financial reporting, tax accounting, and compliance control services pursuant to the Fund Accountant Agreement.

~~Index levels and returns~~The ~~are~~Trust ~~determined~~Administrator ~~using~~liaises ~~transacted~~with ~~crypto asset prices from~~ the ~~Index Provider~~Trust’s ~~vetted markets as determined by the Market Selection Framework. No quote data~~legal, ~~derivative~~accounting ~~data~~and or estimations are used as an estimation of constituent price levels. Real-time index pricing is not streaming but conducted at fixed intervals (e.g., every 15 seconds) as defined in the Index’s methodology. An Intraday index level means the level of an index observed by a calculation agent at any time during the regular trading session hours of the relevant exchange, without regard to after hours or any other ~~trading~~professional ~~outside~~service ofproviders the regular trading session hours. Intraday Index level and return calculations leverage the real-time reference rates. Real-time reference rates are a collection of reference rates quoted in U.S. dollars published once per second, every day of the year for a set of cryptocurrencies and fiat currencies. As such, the real-time reference rates represent the reference rate of one unit of the asset quoted in U.S. dollars. The collection of reference rates is derived from the most recent trade data available from markets traded on cryptocurrency exchanges that are approved to serve as pricing sources (“whitelisted markets”) by the Coin Metrics Oversight Committee (“Index Provider Oversight Committee”) and by applying an exchange volume-weighted median as calculated within the CoinMetrics Real-Time Reference Rate Methodology, version 0needed.~~10, last revised May 27, 2021 (the “Reference Rate Methodology”).~~

The Trust ~~Reference~~Administrator ~~Rate~~keeps ~~Methodology~~proper books of registration and transfer of Shares at its office located in Milwaukee or such office as it may subsequently designate. These books and ~~Coin~~records ~~Metrics~~are ~~Market~~open ~~Selection~~to ~~Framework,~~inspection ~~version~~by 1any person who establishes to the Sponsor’s satisfaction that such person is a Shareholder at all reasonable times during the usual business hours of the Sponsor.~~0.2,~~ ~~last~~The ~~revised~~Sponsor ~~April~~keeps ~~25,~~a ~~2021~~copy (of the Trust Agreement on file in its office, which is available for inspection on reasonable advance notice at all reasonable times during its usual business hours by any Shareholder.

The Transfer Agent

U.S. Global Fund Services serves as the Transfer Agent of the Trust pursuant to the terms and provisions of the Transfer Agent Servicing Agreement (as defined below). The Transfer Agent has its principal office at 615 E. Michigan Street, Milwaukee, WI 53202. A copy of the agreement between the Trust and the Transfer Agent is available for inspection at the Sponsor’s principal office identified herein. Continental Stock Transfer & Trust Company serves as the sub-transfer agent.

The Transfer Agent holds the Shares primarily in book-entry form. The Sponsor directs the Transfer Agent to credit the number of Shares to the investor in response to a creation order and the Transfer Agent issues the Shares. The Transfer Agent also assists with the preparation of Shareholders’ account and tax statements.

The Sponsor indemnifies and holds harmless the Transfer Agent, and the Transfer Agent will incur no liability for the refusal, in good faith, to make transfers which it, in its judgment, deems improper or unauthorized.

Fees paid to the Transfer Agent are an Assumed Expense.

The Marketing Agent

Foreside Fund Services, LLC serves as the Marketing Agent for the Trust. The Marketing Agent provides the following services to the Sponsor: (i) assists the Trust in facilitating Participant Agreements between and among Authorized Participants, the Trust, and the Transfer Agent; (ii) provides prospectuses to Authorized Participants; (iii) works with the Transfer Agent to review and approve orders placed by the Authorized Participants and transmitted to the Transfer Agent; (iv) reviews and files applicable marketing materials with FINRA and (v) maintains, reproduces and stores applicable books and records related to the services provided under the Marketing Agent Agreement.

~~“Market Selection Framework”)~~Custody ~~lays~~of ~~out~~ the ~~criteria~~Trust’s ~~for~~Assets ~~the whitelisted market selection framework. The Index Provider Oversight Committee is responsible for evaluating new markets for inclusion as a selected whitelisted markets~~ and ~~reassessing~~Certain ~~current~~Other ~~whitelisted~~Operational ~~markets on a quarterly basis and during interim periods if market conditions warrant. The evaluation of whitelisted markets is based on the following criteria:~~Matters

● Technology: An assessment of whether the technology infrastructure of the market’s exchange provides sufficient availability and reliability for input data collection. ● Legal and Compliance: An assessment of whether the market’s exchange complies with laws and regulations. Evaluates the exchange’s legal risk exposure, and whether it adheres to regulatory best practices. Evaluates whether the exchange has publicly disclosed trading policies, uses market surveillance technology, and complies with national regulatory organizations, and enforces KYC and AML requirements. Evaluates whether the exchange has functioning fiat and cryptocurrency withdrawals processed within a normal timeframe. Evaluates whether a data sharing license can be executed with the exchange. ● Business Model: An assessment of the market’s exchange with respect to its business model, including its fee structure and asset listing standards. ● Data Availability: An assessment of the available data the market’s exchange offers for the given asset, including the number of markets where the given asset is based on currency, whether the markets are quoted in fiat currencies or other cryptocurrencies, and the type of markets offered. ● Price: An assessment of the quality of the market’s price data, including testing for the occurrence of price outliers and impactful price deviations from other markets, and implementing tests that determine whether the market functions as an active market in the underlying asset and are anchored by observable transactions entered into at arm’s length between buyers and sellers. ● Volume: An assessment of the quality of the market’s volume data, including testing for manipulated volume figures, and implementing tests that determine whether the market functions as an active market in the underlying asset and are anchored by observable transactions entered into at arm’s length between buyers and sellers. The size of the exchange’s markets are also considered. ● Order Book: An assessment of the quality of the market’s order book data, including tests for manipulated orders, and implementing tests that determine whether the market functions as an active market in the underlying asset and are anchored by observable transactions entered into at arm’s length between buyers and sellers. The liquidity of the market is also considered.Bitcoin Custodian

~~The~~Coinbase Custody ~~following~~serves isas aour ~~description~~ qualified digital asset custodian for purposes of Section 206(4)-2(d)(6) under the ~~calculation~~Advisers ~~algorithm~~Act. ofOn November 26, 2025, the CMTrust ~~Reference~~entered ~~Rates~~into a Custodial Services Agreement by and among Coinbase Custody and the Trust, ~~showing~~which ~~how~~replaced ~~price~~the ~~data~~Trust’s prior ~~from~~Custodial ~~each~~Services ~~separate~~Agreement, ~~market~~dated as of February 4, 2022, between the Trust and Coinbase Custody, and which is ~~combined:~~a part of the Prime Execution Agreement.

1.Coinbase Custody ~~Calculate~~is ~~the~~a ~~volume~~wholly-owned ~~denominated~~subsidiary inof ~~units~~Coinbase ofGlobal, ~~the~~Inc. ~~given~~(“Coinbase ~~asset~~Global”). ~~from~~Coinbase ~~observable~~Global ~~transactions~~and ~~that~~its ~~occurred~~subsidiaries ~~over~~provide end-to-end ~~the~~financial ~~trailing~~infrastructure 60and ~~minutes~~technology for ~~each of~~ the ~~constituent markets~~crypto-economy. ~~Calculate~~Coinbase ~~the~~Custody ~~volume~~is ~~weight~~an ~~for~~independently ~~each~~capitalized ofNew ~~the~~York State ~~constituent~~limited ~~markets~~purpose bytrust ~~dividing~~company ~~the~~that ~~volume~~was ~~figure~~chartered ~~for~~in ~~each~~October ~~of the constituent markets by the total volume across all constituent markets~~2018. ~~The~~Coinbase ~~resulting~~Custody ~~figure~~ is ~~referred~~a tofiduciary asunder ~~the~~Section ~~volume~~100 ~~weight.~~of ~~2. Convert~~ the ~~trade~~New York ~~price~~Banking ofLaw ~~all~~and ~~observable~~a ~~transactions~~qualified ~~over~~custodian ~~the trailing 60 minutes~~ for ~~each~~purposes of ~~the~~Rule ~~constituent markets to U.S. dollars, if necessary, using the Reference Rate calculated for Bitcoin~~ 206(~~BTC~~4).-2(d)(6) ~~Calculate~~under the ~~inverse~~Investment ~~variance~~Advisers ofAct, ~~the~~and ~~trade~~is ~~price~~licensed ~~converted~~ to custody ~~U.S.~~Digital ~~dollars~~Assets ~~for~~on ~~each~~behalf of the ~~constituent~~Trust. ~~markets~~As ~~using~~a ~~the~~New ~~population~~York ~~mean~~State inlimited ~~the~~purpose ~~calculation~~trust ~~of variance~~company, ~~where~~Coinbase ~~the~~Custody ~~population mean~~ is ~~defined~~subject asto ~~the~~regulation, examination ~~mean~~and ~~price~~supervision ofby ~~all trades from constituent markets over~~ the ~~trailing 60 minutes~~NYDFS. IfThe aNYDFS’ ~~constituent~~regulations ~~market~~impose ~~has~~various ancompliance ~~infinite or undefined inverse price variance~~requirements, ~~the~~including ~~inverse~~operational limitations ~~price~~related ~~variance for that constituent market is set~~ to ~~zero. Calculate~~ the ~~inverse~~nature ~~price variance weight for each~~ of ~~the~~digital ~~constituent~~assets ~~markets~~held byunder ~~dividing~~custody, ~~the~~capital ~~inverse~~requirements, ~~price~~BSA ~~variance~~and byanti-money ~~the~~laundering ~~total~~program ~~inverse~~requirements, and ~~price~~notice ~~variance~~and ~~across~~reporting ~~all constituent markets~~requirements. ~~The~~Coinbase ~~resulting~~Custody ~~figure~~offers isits ~~referred~~clients access to assecure, ~~the~~institutional-grade ~~inverse~~offline ~~price~~digital ~~variance weight~~asset storage. 3.As ~~Calculate the final weight for each~~ of ~~the~~December ~~constituent~~31, ~~markets~~2025, byCoinbase ~~taking~~Global aheld ~~mean~~approximately of$376 ~~the~~billion ~~volume~~in ~~weight~~fiat and ~~the~~digital ~~inverse~~assets ~~price~~on ~~variance~~its ~~weight.~~platform, ~~4. Extract~~ the ~~most~~majority of ~~recent~~which ~~observable~~were ~~transaction~~comprised ~~from each~~ of ~~the~~Bitcoin, ~~constituent~~Ethereum ~~markets.~~and ~~Convert~~other ~~the~~digital ~~trade~~assets. ~~price~~According ~~of the most recent observable transactions~~ to ~~U.S.~~publicly ~~dollars,~~available ~~if necessary~~information, ~~using~~Bitcoin ~~the~~represented approximately ~~Reference~~67%, ~~Rate~~58% ~~calculated~~and ~~for~~47% ~~Bitcoin~~of ~~(BTC). 5. Calculate~~ the ~~weighted~~assets ~~median~~held ~~price~~or ofmanaged ~~the~~in ~~most~~digital ~~recent~~wallets ~~observable~~on ~~transactions~~Coinbase’s ~~using~~Global ~~the~~platform, ~~price~~including its ~~calculated~~custody inservices, ~~step~~for 4the ~~and~~years ~~the~~ended ~~final~~December ~~weight~~31, ~~calculated~~2025, in2024 ~~step~~and 32023, respectively. The ~~weighted~~offline ~~median~~(cold) ~~price~~storage istechnology ~~calculated~~that Coinbase byCustody ~~ordering~~uses ~~the~~to ~~transactions~~custody ~~from~~digital ~~lowest~~assets, tosuch ~~highest~~as ~~price~~Bitcoin, ~~and~~shares ~~identifying~~ the ~~price~~same ~~associated~~framework ~~with~~of the ~~trades~~technology atthat ~~the~~Coinbase ~~50th~~Global, ~~percentile~~and its ofpredecessor, ~~final~~Coinbase, ~~weight~~Inc., ~~The~~have ~~resulting~~used ~~figure~~since 2012, which is ~~the~~continuously ~~Reference~~improved ~~Rate~~to ~~for~~meet ~~the~~cyber ~~given~~and ~~asset~~physical security best practices.

Coinbase Custody is authorized to serve as the Trust’s custodian under the Trust Agreement and pursuant to the terms and provisions of the Custodial Services Agreement. The Trust’s digital assets are held in segregated offline (cold) storage accounts with the Bitcoin Custodian, and as a result, the digital assets are segregated from both (i) the proprietary property of Coinbase Custody and its affiliates; and (ii) the assets of any other Coinbase Custody client.

Cash Custodian

U.S. Bank National Association serves as the Cash Custodian pursuant to the Cash Custody Agreement. The Cash Custodian is the custodian for the Trust’s cash holdings. The Trust may retain additional cash custodians from time to time pursuant to a cash custodian agreement to perform certain services that are typical of a cash custodian. The Sponsor may, in its sole discretion, add or terminate cash custodians at any time.

Additional Custodial Matters

The Trust may engage third-party custodians or vendors besides the Bitcoin Custodian and the Cash Custodian to provide custody and security services for all or a portion of its Bitcoin and/or cash, and the Sponsor will pay the custody fees and any other expenses associated with any such third-party custodian or vendor. The Sponsor may, in its sole discretion, add or terminate custodians at any time. The Sponsor may, in its sole discretion, change the custodian for the Trust’s holdings, but it will have no obligation whatsoever to do so or to seek any particular terms for the Trust from other such custodians.

The Prime Execution Agent

The Prime Execution Agent, Coinbase Inc., an affiliate of the Bitcoin Custodian, provides prime execution agent services, including Bitcoin trade execution, from time to time as requested by the Sponsor, although the Sponsor may also trade directly with other third parties and/or market makers. The Trust may engage in purchases of Bitcoin (creation of Baskets) or sales of Bitcoin (redemptions of Baskets, Trust expenses, or the Management Fee, as necessary) by placing orders with the Prime Execution Agent. The Prime Execution Agent routes orders placed by the Trust through the Prime Execution Agent’s execution platform, where the order is executed. Each order placed by the Trust is sent, processed and settled at each Connected Trading Venue to which it is routed. Subject to the foregoing, the Prime Execution Agent (as well as the Trust and the Sponsor) shall have no liability, obligation, or responsibility whatsoever for the selection or performance of any trading venue, and that other trading venues not used for the specific execution and/or trading venues not used by Coinbase may offer better prices and/or lower costs than the trading venue used to execute the Trust’s orders.

~~Adjustments to the pricing~~Trade ~~data~~Credit are made (1) if observable transactions from a constituent market are unable to be collected due to technical problems specific to the constituent market’s exchange during the calculation of a Reference rate, the observable transactions from the constituent market are not included in the calculation of the specific instance of the given Refence Rate and (2) if no observable transactions from constituent markets exist during the trailing 60 minutes, the value of the Reference Rate will be determined to equal the value calculated during the previous second. If potential errors or anomalies in the data are detected, the exercise of expert judgment will be applied by Coin Metrics to determine if the potentially erroneous data is included in the calculation of the Reference Rate. If errors are discovered in the calculation process subsequent to the publication of the Reference Rate, a recalculated reference rate may be published.Lender

~~Official~~To avoid ~~Index~~having ~~levels are~~to ~~produced~~pre-fund ~~daily~~purchases ator ~~4:00~~sales ~~pm,~~of ~~New~~Bitcoin ~~York~~in ~~time.~~connection ~~End-~~with cash creations and redemptions and sales of~~-day~~ ~~Index~~Bitcoin ~~level~~to pay the Management Fee and ~~return~~any ~~calculations~~other ~~leverage~~Trust expenses not assumed by the ~~hourly~~Sponsor, ~~reference~~to ~~rates~~the extent applicable, pursuant to that certain Trade Financing Agreement, dated as of November 26, 2025, which ~~are~~is ~~derived~~part byof ~~applying~~the aPrime ~~volume-weighted~~Execution ~~median~~Agreement ~~price~~(the to“Trade ~~trade~~Financing ~~data~~Agreement”), the ~~that~~Trust ~~has~~may ~~been~~borrow ~~collected~~Bitcoin ~~over~~or cash as Trade Credit from Coinbase Credit, Inc. (the “Lender”) on a 61short-~~minute~~term ~~interval~~basis, allowing the Trust to avoid having to pre-fund purchases or sales of Bitcoin.

~~Determination of Index~~Other ~~levels is dependent on the availability of data from CM Reference Rates. To the extent that there are not enough markets to inform a CM Reference Rate, the Index Provider will act as follows:~~Matters

●The Shareholders’ Inrecourse against the ~~case~~Sponsor, ofthe aTrustee, ~~market~~and the Trust’s ~~closure~~other service providers for the services they provide to the Trust, ~~temporary~~including, ~~suspension~~without limitation, those relating to the holding of ~~trading~~Bitcoin or anthe ~~outage~~provision of instructions relating to the movement of Bitcoin, is limited. For the ~~Index~~avoidance ~~Provider~~of ~~will~~doubt, ~~reference~~neither the ~~latest~~Sponsor, ~~available~~the ~~hourly~~Trustee, ~~reference~~nor ~~rate.~~any ●of Intheir affiliates, nor any other party has guaranteed the ~~case~~assets or liabilities, or otherwise assumed the liabilities, of ~~on-chain~~the ~~events~~Trust, ~~such~~or asthe aobligations ~~fork~~or liabilities of any service provider to the Trust, ~~that~~including, ~~result~~without inlimitation, the Bitcoin Custodian. Consequently, a ~~market~~loss may be suffered with respect to the Trust’s ~~trading~~Bitcoin ~~suspension~~that is not covered by the Bitcoin Custodian’s insurance and for which no person is liable in damages. As a result, the ~~Index~~recourse ~~Provider~~of ~~will~~the ~~reference~~Trust or the ~~latest~~Shareholders, ~~available~~under ~~hourly~~applicable ~~reference~~law, ~~rate~~is limited.

~~All decisions relating to~~Creation ~~unavailability~~and ofRedemption ~~data for the determination~~ of the Index level will be made by the Coin Metrics Index Committee who may exercise expert judgment in exceptional circumstances or in the event of prolonged data unavailability. The Trust is not affiliated with, sponsored, promoted, sold or supported in any other manner with Coin Metrics, Inc., the Index Provider.Shares

~~Forms~~The Trust creates and redeems Shares on a continuous basis but only in Baskets based on the quantity of ~~Attack~~Bitcoin ~~Against~~attributable to each Share of the Trust (net of accrued but unpaid expenses and liabilities) multiplied by the number of Shares comprising a Basket (10,000) (the “Basket Amount”). Fractions of a Bitcoin ~~Network~~smaller than .00000001 (known as a “satoshi”) are disregarded for purposes of the computation of the Basket Amount. Only Authorized Participants, which are registered broker-dealers who have entered into written agreements with the Sponsor and the Trust, can place orders to receive or redeem Baskets.

~~All~~In ~~networked~~connection ~~systems~~with ~~are~~cash ~~vulnerable~~creations and redemptions, an Authorized Participant shall deliver to ~~various~~the ~~kinds~~Transfer Agent the amount of ~~attacks~~U.S. Asdollars needed ~~with~~to ~~any~~purchase ~~computer~~the ~~network~~Basket Amount of Bitcoin, and the Trust engages in Bitcoin ~~Network~~transactions ~~contains~~for ~~certain~~converting cash into Bitcoin (in association ~~flaws~~with purchase orders) and Bitcoin into cash (in association with redemption orders). ~~For~~The ~~example,~~Trust ~~the~~conducts its Bitcoin ~~Network~~purchase isand ~~currently~~sale transactions ~~vulnerable~~by topurchasing Bitcoin directly from third parties (each, a “~~51%~~Bitcoin ~~attack~~Trading Counterparty”), ~~where~~pursuant to written agreements between such Bitcoin Trading Counterparties and the Trust, ifor athrough ~~mining~~purchases ~~pool~~from ~~were~~the Prime Execution Agent through its Coinbase Prime service pursuant to ~~gain~~the Prime Execution Agreement. The Trust’s criteria for engaging one or more Bitcoin Trading ~~control~~Counterparties includes the completion of ~~more~~due ~~than~~diligence ~~50%~~that considers each such Bitcoin Trading Counterparty’s Bitcoin trading capabilities, organizational structure, operating history, lines of ~~the~~business, ~~hash~~controls, ~~rate~~and ~~for~~other adetails ~~digital~~necessary ~~asset~~to evaluate their ability to facilitate cash creations. The Bitcoin Trading Counterparties are Coinbase, aAnchorage ~~malicious~~and ~~actor~~JSCT, ~~would~~LLC. Bitcoin Trading Counterparties may be ~~able~~added toat ~~gain~~any ~~full~~time, ~~control~~subject to the discretion of the ~~network~~ Sponsor. The Sponsor will notify investors whether and ~~the~~when ~~ability~~it tohas ~~manipulate~~engaged additional Bitcoin Trading Counterparties by filing a current report on Form 8-K or via a posting on the ~~Blockchain~~Trust’s website.

InJane ~~addition~~Street Capital, ~~many~~LLC, ~~digital~~an ~~asset~~Authorized ~~networks~~Participant, is an affiliate of JSCT, LLC, a Bitcoin Trading Counterparty. Aside from JSCT, LLC, the Trust is not aware of any other affiliation or material relationship between a Bitcoin Trading Counterparty and the Authorized Participants or other service providers of the Trust in executing a transaction in Bitcoin with the Trust. Current or future Bitcoin Trading Counterparties may be affiliates of, or have ~~been~~material ~~subjected~~relationships with, the Trust’s current or future Authorized Participants. In connection with cash creations and redemptions, each Bitcoin Trading Counterparty represents to athe ~~number~~Trust that it is acting for itself and not for another person and is not acting as an agent or at the direction of ~~denial-~~any Authorized Participant. Upon receipt of~~-service~~ ~~attacks~~an order from an Authorized Participant to create or redeem Baskets, ~~which~~the ~~has~~Trust ~~led~~may obtain quotes for a price to ~~temporary~~purchase or sell Bitcoin from one or more Bitcoin ~~delays~~Trading Counterparties. A Bitcoin Trading Counterparty may respond to the Trust’s request with an offer of a quote at which it is willing to sell the specified quantity of Bitcoin, or a portion thereof, in ~~block~~the case of a creation, ~~and~~or a quote at which it is willing to buy the specified quantity of Bitcoin, or a portion thereof, in the ~~transfer~~case of a redemption, as indicated in such offer. The Bitcoin Trading Counterparties are not contractually obligated to participate in cash orders for creations or redemptions by placing any offers to buy or sell Bitcoin with the Trust. ~~Any~~The ~~similar~~Trust ~~attacks~~then ondetermines, in its sole discretion, whether to utilize one of the Bitcoin ~~Network~~Trading Counterparties that ~~impact~~provided a quote or to trade through the ~~ability~~Prime Execution Agent to ~~transfer~~ execute a Bitcoin ~~could~~trade. ~~have~~Once an offer is accepted, it becomes a ~~material~~trade ~~adverse~~that ~~effect~~is binding on both the ~~price~~Trust ofand the Bitcoin Trading Counterparty. Each Bitcoin Trading Counterparty is required to comply with U.S. federal and/or ~~the~~state ~~value~~laws ofincluding ~~the~~licensing ~~Units~~and registration requirements or similar laws in non-U.S. jurisdictions and maintain practices and policies designed to comply with AML and KYC regulations or similar laws in non-U.S. jurisdictions.

~~Market~~The Prime ~~Participants~~Execution Agent may facilitate the purchase and sale or settlement of the Trust’s Bitcoin transactions. Bitcoin Trading Counterparties may settle trades with the Trust using their own accounts at the Prime Execution Agent or directly with the Trust when trading with the Trust.

Miners

Miners range from Bitcoin enthusiasts to professional mining operations that design and build dedicated machines and data centers, including mining pools, which are groups of miners that act cohesively and combine their processing to solve blocks. When a pool solves a new block, the pool operator receives the Bitcoin and, after taking a nominal fee, splits the resulting reward among the pool participants based on the processing power each of them contributed to solve for such block. Mining pools provide participants with access to smaller, but steadier and more frequent, Bitcoin payouts. See “—Creation of New Bitcoin” above.

Investment and Speculative Sector

This sector includes the investment and trading activities of both private and professional investors and speculators. Historically, larger financial services institutions are publicly reported to have limited involvement in investment and trading in digital assets, although the participation landscape is beginning to change.

Retail Sector

The retail sector includes users transacting in direct peer-to-peer Bitcoin transactions through the direct sending of Bitcoin over the Bitcoin Network. The retail sector also includes transactions in which consumers pay for goods or services from commercial or service businesses through direct transactions or third-party service providers.

~~Service~~Issuance of ~~Sector~~Baskets - Transaction Fees

~~This~~To ~~sector~~compensate ~~includes~~for ~~companies~~expenses ~~that~~incurred ~~provide~~in aconnection ~~variety~~with ofthe ~~services~~creation ~~including~~and ~~the~~redemption ~~buying,~~of ~~selling~~Baskets, ~~payment~~an ~~processing~~Authorized ~~and~~Participant ~~storing~~is ofrequired ~~Bitcoin.~~to ~~Bittrex,~~pay ~~BitStamp,~~a ~~Coinbase~~standard ~~Pro~~transaction fee in cash to create or redeem Baskets, ~~Kraken~~which ~~and~~is ~~itBit~~not ~~are~~expected ~~some~~to ofvary ~~the~~in ~~largest~~accordance ~~Bitcoin~~with ~~exchanges~~the bynumber ~~volume~~of ~~traded~~Baskets in such order. ~~Coinbase~~The ~~Custody serves~~total astransaction ~~the~~fee ~~Trust’s~~also ~~custodian~~includes ~~providing~~applicable ~~hot~~taxes, brokerage and ~~cold~~any ~~digital~~other ~~wallet~~commissions, ~~storage~~transaction ~~for~~fees ~~the~~(including financing), ~~Trust’s~~trade ~~Bitcoin.~~slippage Asand market impact costs, as applicable, and may be reduced, increased or otherwise changed by the ~~Bitcoin~~Sponsor ~~Network~~and ~~continues~~the Trust based on changes to ~~grow~~the incosts ~~acceptance,~~or itinputs isassociated ~~anticipated~~with ~~that~~the ~~service~~total ~~providers~~transaction ~~will~~fee. ~~expand~~The ~~the~~Sponsor ~~currently~~will ~~available~~notify ~~range~~Authorized ofParticipants ~~services~~of ~~and~~any ~~that~~change ~~additional~~in ~~parties~~the transaction fee and will ~~enter~~not implement any change in the ~~service~~fee ~~sector~~until ~~for~~after the ~~Bitcoin~~date ~~Network~~of notice.

~~Competition~~Issuance of Baskets - In-Kind Creations

~~Bitcoin~~In isconnection ~~not~~with ~~the~~an ~~only~~in-kind ~~available~~creation, ~~decentralized~~an ~~digital~~Authorized ~~asset.~~Participant ~~Other~~is ~~digital~~required ~~assets have been developed since the inception of the Bitcoin, including, but not limited~~ to, ~~Ethereum,~~submit ~~Litecoin, Monero and Zcash. Although a competitive digital asset could displace~~ the ~~market share~~creation ~~Bitcoin~~order ~~currently~~by ~~occupies,~~an itorder ~~would~~cutoff ~~face~~time ~~significant headwinds due to~~ (the ~~network effect and financial and intellectual~~ ~~investments~~“In-Kind ~~currently~~Order ~~enjoyed~~Cutoff ~~by the market leader~~Time”). AsThe ofIn-Kind ~~January~~Order 6,Cutoff ~~2023,~~Time ~~the~~is ~~Bitcoin~~3:59 ~~network~~p.m. ~~market~~ET ~~share~~on of the ~~total~~trade ~~digital market capitalization was estimated to be approximately 40%~~date. ~~Further,~~The ~~many~~Authorized ~~Bitcoin exchanges use Bitcoin as the exchange comparison~~Participant ~~for~~must ~~other~~submit ~~cryptocurrencies.~~an ~~For~~in-kind ~~example, to~~ purchase ~~certain~~order ~~cryptocurrencies you first need~~ to ~~purchase~~the ~~Bitcoin~~Transfer onAgent anindicating ~~exchange and~~the ~~then~~number ~~use~~of ~~the~~Baskets ~~Bitcoin~~it intends to ~~purchase other cryptocurrencies~~acquire.

~~Government~~The date ~~Oversight~~the ~~– Regulation~~Transfer Agent receives the in-kind purchase order determines the amount of Bitcoin that the Authorized Participant or its designated agent or client needs to deposit. However, orders received by the Transfer Agent after the In-Kind Order Cutoff Time will not be accepted and should be resubmitted on the following Business Day.

UIf the Trust and the Marketing Agent accept the in-kind purchase order, the Transfer Agent transmits to the Authorized Participant, via electronic mail message or other electronic communication, no later than 8:00 p.Sm. ET on the date such purchase order is received, or ~~regulators~~deemed received, ata ~~both~~copy of the ~~state~~purchase ~~and~~order ~~federal~~endorsed ~~level,~~“Accepted” ~~and~~by ~~foreign~~the ~~regulators~~Trust and ~~legislatures~~indicating ~~have~~the ~~taken~~Basket ~~action~~Amount ~~against~~that ~~digital asset~~the ~~businesses~~Authorized Participant or ~~enacted~~its ~~restrictive~~designated ~~regimes~~agent inor ~~response~~client must deliver to ~~adverse~~the ~~publicity~~Prime ~~arising~~Execution ~~from~~Agent ~~cybersecurity~~in ~~risks,~~exchange ~~potential~~for ~~consumer~~each Basket. Prior ~~harm~~to orthe ~~digital~~Trust’s ~~assets~~acceptance, ~~used~~a purchase order only represents the Authorized Participant’s unilateral offer to deposit Bitcoin in ~~connection~~exchange ~~with~~for ~~criminal~~Baskets ~~activity.~~and ~~The~~has ~~value~~no ofbinding effect upon the Trust, the Trustee, the Trust Administrator, the Transfer Agent, the Marketing Agent, the Bitcoin ~~could~~Custodian, bethe ~~impacted~~Prime byExecution ~~such~~Agent ~~adverse~~or ~~publicity~~any other party.

~~For~~The ~~example,~~amount ~~concerns~~of ~~have~~Bitcoin ~~been~~necessary ~~raised~~for ~~about~~ the ~~electricity~~creation ~~required~~of toa ~~secure~~Basket ~~and~~changes ~~maintain~~from ~~the~~day ~~Bitcoin~~to ~~Network~~day. OnAs ~~January~~of 3,December ~~2023~~31, in ~~connection with the mining process~~2025, ana ~~all-time~~Basket ~~high~~required delivery of ~~over~~3.22083471 ~~271 million tera hashing operations were performed every second, non-stop on the~~ Bitcoin ~~Network~~. ~~Although~~On ~~measuring~~each ~~the~~day ~~electricity~~that ~~consumed~~the byListing ~~this~~Exchange ~~process~~ is ~~difficult~~open ~~because~~for ~~these~~regular ~~operations are performed by various machines with varying levels of efficiency~~trading, the ~~process~~Trust ~~consumes~~Administrator aadjusts ~~significant~~the ~~amount~~ quantity of ~~energy.~~Bitcoin ~~Further, in~~constituting ~~addition to~~ the ~~direct~~Basket ~~energy~~Amount ~~costs~~as ofappropriate ~~performing~~to ~~these~~reflect ~~calculations,~~sales ~~there~~of ~~are indirect costs that impact the~~ Bitcoin ~~Network’s total energy consumption~~, ~~including~~any ~~the~~loss ~~costs~~ of ~~cooling~~Bitcoin ~~the machines~~ that ~~perform~~may ~~these calculations. In recent months~~occur, ~~due~~and toaccrued ~~these~~expenses. ~~concerns~~The ~~around~~computation ~~energy~~is ~~consumption,~~made ~~particularly~~by asthe ~~such~~Trust ~~concerns~~as ~~relate~~promptly toas ~~public~~practicable ~~utilities~~after ~~companies,~~4:00 ~~various~~p.m. ~~states and cities have implemented, or are considering implementing, moratoriums on Bitcoin mining in their jurisdictions~~ET. AThe ~~significant~~Trust ~~reduction in~~Administrator ~~mining~~determines ~~activity as a result of such actions could adversely affect~~ the amount ~~security~~ of ~~the~~ Bitcoin ~~Network~~necessary ~~by making it easier~~ for a ~~malicious actor or botnet to manipulate~~ the ~~Blockchain.~~creation ~~See~~of ~~“Risk~~a ~~Factors—Risk~~Basket ~~Factors~~for ~~Related to Digital Assets—If~~ a ~~malicious~~given ~~actor~~day orby ~~botnet~~multiplying ~~obtains~~the ~~control~~NAV ofper ~~more~~Share ~~than~~by ~~50% of~~ the ~~processing~~number ~~power~~of onShares ~~the~~in each ~~Bitcoin~~Basket ~~Network~~(10,000) orand ~~otherwise~~dividing ~~obtains control over~~ the ~~Bitcoin~~resulting ~~Network~~product ~~through~~by ~~its~~that ~~influence~~day’s ~~over~~Index. ~~core~~The ~~developers~~Basket orAmount ~~otherwise,~~so ~~such~~determined ~~actor~~is ormade ~~botnet could manipulate~~available ~~the Blockchain~~ to ~~adversely~~all ~~affect~~Authorized anParticipants ~~investment~~and inis ~~the~~made ~~Shares~~available oron the ~~ability~~Sponsor’s ofwebsite for the ~~Trust to operate~~Shares.”

The Authorized Participant or its designated agent or client deposit Bitcoin related to the Authorized Participant’s purchase order to the Trust’s Trading Account. This transfer is an “off-chain” transaction that is represented in the books and records of the Prime Execution Agent. In the event that the Authorized Participant, its designated agent or client, has not deposited the Bitcoin to the Trust’s Trading Account at the Prime Execution Agent by the applicable time on the settlement date of the in-kind creation order, the Authorized Participant is given the option to (1) cancel the in-kind creation order; (2) delay settlement of the order to enable delivery of Bitcoin at a later date approved by the Trust Administrator; or (3) accept that the Trust will execute a Bitcoin transaction required for the creation and the Authorized Participant will deliver the U.S. ~~Legal~~dollars required for this purchase. The Authorized Participant is liable to the Trust for and ~~Regulatory~~shall bear all slippage costs as well as all ~~Treatment~~other costs, expenses, liabilities, and losses, suffered or incurred by the Trust in connection with the events described in the foregoing sentence, including, without limitation, the dollar cost of the difference between the Bitcoin price utilized in calculating NAV per Share on the trade date and the price at which the Trust receives the Bitcoin to the extent the price realized in buying the Bitcoin is higher than the Bitcoin price utilized in the NAV, if applicable. To the extent the price realized in buying the Bitcoin is lower than the price utilized in the NAV, the Authorized Participant shall get to keep the dollar impact of any such difference.

AsIssuance ~~digital assets have grown in both popularity and market size, the U.S. Congress and a number~~ of ~~U.S.~~Baskets federal and state agencies (including FinCEN, SEC, CFTC, the Financial Industry Regulatory Authority (“FINRA”), the Consumer Financial Protection Bureau (“CFPB”), the Department of Justice, the Department of Homeland Security, the Federal Bureau of Investigation, the IRS and state financial institution regulators) have been examining the operations of digital asset networks, digital asset users and the digital asset spot markets, with particular focus on the extent to which digital assets can be used to launder the proceeds of illegal activities or fund criminal or terrorist enterprises and the safety and soundness of spot markets or other service-~~providers~~ ~~that~~Cash hold digital assets for users. Many of these state and federal agencies have issued consumer advisories regarding the risks posed by digital assets to investors. In addition, federal and state agencies, and other countries have issued rules or guidance about the treatment of digital asset transactions or requirements for businesses engaged in digital asset activity. As noted previously, the SEC has not asserted regulatory authority over Bitcoin or trading or ownership of Bitcoin and has not expressed the view that Bitcoin should be classified or treated as a security for purposes of U.S. federal securities laws. However, the SEC has asserted that certain investment activities involving Bitcoin, including offering investments related to the mining of Bitcoin or offering participation in pools lending Bitcoin may implicate the investment contract definition of security and therefore be within the jurisdiction of the SEC. In addition, there have been a number of SEC enforcement actions brought that involve crypto assets and related activities.Creations

~~The~~In ~~CFTC~~connection ~~has~~with ~~regulatory~~a ~~jurisdiction~~cash ~~over~~creation, ~~transactions in Bitcoin futures and~~ the ~~Bitcoin~~Authorized ~~futures~~Participant ~~markets.~~is Inrequired ~~addition,~~to ~~because~~submit the ~~CFTC~~ ~~has~~purchase ~~determined~~order ~~that~~by ~~Bitcoin~~an isearly aorder ~~“commodity”~~cutoff ~~under~~time (the “Cash ~~CEA~~Order ~~and~~Cutoff ~~the~~Time”). ~~rules~~The ~~thereunder,~~Cash itOrder ~~has~~Cutoff ~~jurisdiction~~Time tois ~~prosecute fraud~~5:30 ~~and~~p.m. ~~manipulation~~ET inon the ~~cash,~~Business orDay ~~spot,~~prior ~~market~~to ~~for~~the ~~Bitcoin~~trade date. The ~~CFTC~~Authorized Participant ~~has~~may ~~pursued~~submit ~~enforcement~~a ~~actions~~purchase ~~relating~~order to ~~fraud~~the ~~and manipulation~~Transfer ~~involving~~Agent, ~~Bitcoin~~indicating ~~and~~the ~~Bitcoin~~number ~~markets. Beyond instances~~ of ~~fraud~~Baskets orit ~~manipulation,~~intends ~~the~~to ~~CFTC generally does not oversee cash or spot~~acquire.

In connection with a cash creation, the date the Transfer Agent receives that order determines the estimated cash amount the Authorized Participant needs to deposit and the amount of Bitcoin the Trust needs to purchase from the Bitcoin Trading Counterparty or through the Prime Execution Agent for the Basket Amount. The final cash amounts are determined after the NAV of the Trust is struck and the Trust’s Bitcoin transactions have settled. However, orders received by the Transfer Agent after the Cash Order Cutoff Time will not be accepted and should be resubmitted on the following Business Day.

If the ~~market~~Trust ~~exchanges~~and the Marketing Agent accept the cash purchase order, the Transfer Agent transmits to the Authorized Participant, via electronic mail message or ~~transactions~~other ~~involving~~electronic ~~Bitcoin~~communication, ~~that~~no dolater ~~not~~than ~~use~~8:00 ~~margin~~p.m. ET on the date such purchase order is received, ~~leverage~~or deemed received, a copy of the purchase order endorsed “Accepted” by the Trust and indicating the amount of U.S. dollars that the Authorized Participant must deliver to the Custodians or ~~financing~~Prime ~~with~~Execution ~~respect~~Agent in exchange for each Basket. Prior to the Trust’s acceptance ~~retail~~as ~~market~~specified ~~participants~~above, a purchase order only represents the Authorized Participant’s unilateral offer to deposit cash in exchange for Baskets and has no binding effect upon the Trust, the Trustee, the Trust Administrator, the Transfer Agent, the Marketing Agent, the Bitcoin Custodian or any other party.

OnThe ~~December~~amount 1,of ~~2017,~~cash ~~two~~necessary ~~designated~~for ~~contract~~the ~~markets~~creation ~~(“DCMs”)~~of ~~registered~~a ~~with~~Basket ~~the~~changes ~~CFTC~~from ~~self-certified~~day ~~new~~to ~~contracts~~day ~~for Bitcoin~~based ~~futures~~on ~~products.~~the ~~DCMs~~Basket ~~are~~Amount. ~~boards~~As of ~~trades~~December ~~(or~~31, ~~futures~~2025, ~~exchanges)~~a Basket ~~that~~required ~~operate~~delivery ~~under the regulatory oversight~~ of ~~the~~$ ~~CFTC~~281, ~~pursuant~~228.89. toOn ~~Section~~each 5day ofthat the ~~CEA.~~Listing ToExchange ~~obtain~~is ~~and~~open ~~maintain~~for ~~designation~~regular astrading, athe ~~DCM,~~Trust anAdministrator adjusts ~~exchange~~the ~~must~~amount ~~comply~~of onU.S. andollars ~~initial~~needed ~~and~~to ~~ongoing basis,~~purchase ~~with~~the ~~twenty-three~~Basket ~~Core~~Amount. ~~Principles~~The ~~established~~Trust inAdministrator ~~Section~~determines ~~5(d)~~the amount of Bitcoin necessary for the ~~CEA.~~creation ~~Among~~of ~~other~~a ~~things,~~Basket ~~DCMs~~for ~~are~~a ~~required~~given today ~~establish self-regulatory~~by ~~programs~~multiplying ~~designed~~the toNAV ~~enforce~~per ~~the~~Share ~~DCM’s~~by ~~rules,~~the ~~prevent~~number ~~market~~of ~~manipulation~~Shares ~~and~~in ~~customer~~each ~~and~~Basket ~~market~~(10,000) ~~abuses~~ and ~~ensure~~ dividing the ~~recording~~resulting ~~and~~product ~~safe~~by ~~storage~~that ofday’s ~~trade information~~Index. The ~~CFTC~~Trust ~~engaged~~Administrator inthen adetermines ~~“heightened~~the ~~review”~~amount of ~~the~~U.S. ~~self-certification of~~dollars ~~Bitcoin~~equal ~~futures,~~to ~~which~~the required amount ~~DCMs~~of toBitcoin ~~enter~~as ~~direct~~described ~~information~~above ~~sharing~~on ~~agreements~~each ~~with~~date ~~spot~~the ~~market~~Transfer ~~platforms~~Agent toreceives ~~(i)~~the ~~allow access~~cash tocreation ~~trade~~order. ~~and~~The ~~trader~~final ~~data,~~cash ~~(ii)~~amounts ~~monitor~~are ~~data~~determined after ~~from~~the ~~cash~~NAV ~~markets~~of ~~with~~the ~~respect~~Trust tois ~~price~~struck ~~settlements~~ and ~~other~~the Trust’s Bitcoin ~~prices more~~transactions ~~broadly~~have ~~and~~settled. ~~identify~~The ~~anomalies~~amount ~~and~~of ~~disproportionate~~U.S. ~~moves~~dollars inneeded ~~the cash markets compared~~ to purchase the ~~futures~~Basket ~~markets,~~Amount ~~(iii)~~so ~~engage in~~determined ~~inquiries,~~is ~~including~~made atavailable ~~the~~to ~~trade~~all ~~settlement~~Authorized ~~level~~Participants ~~when necessary~~ and ~~(iv)~~Bitcoin ~~agree~~Trading toCounterparties ~~regular~~and ~~coordination~~is ~~with~~made ~~CFTC surveillance~~available ~~staff~~ on ~~trade~~the ~~activities,~~Sponsor’s ~~including~~website ~~providing~~for the ~~CFTC surveillance team with trade settlement data upon request~~Shares.

On the ~~March~~date 9of the Cash Order Cutoff Time, the Trust enters into a transaction with a Bitcoin Trading Counterparty or the Prime ~~2022,~~Execution ~~President~~Agent ~~Biden~~to ~~signed~~buy anBitcoin ~~Executive~~in ~~Order~~exchange onfor ~~Ensuring~~the ~~Responsible~~cash ~~Development~~proceeds from such purchase order. For settlement of ~~Digital~~a ~~Assets~~cash (creation, the Trust ~~“Executive~~delivers ~~Order”)~~Shares to the Authorized Participant in exchange for cash received from the Authorized Participant. Meanwhile, the ~~which~~Bitcoin ~~outlined~~Trading aCounterparty ~~unified~~or ~~federal~~Prime ~~regulatory~~Execution ~~approach~~Agent, as applicable, delivers the required Bitcoin pursuant to ~~addressing~~its trade with the Trust ~~risks~~into the Trust’s Trading Account with the Prime Execution Agent in exchange for cash. In the event that the Trust has not been able to successfully execute and ~~benefits~~complete settlement of ~~digital~~a ~~assets.~~Bitcoin ~~The~~transaction ~~Executive~~by ~~Order~~the settlement date of the purchase order, ~~articulated~~the ~~various~~Authorized ~~policy~~Participant ~~objectives~~will ~~related~~be given the option to ~~digital~~(1) ~~assets,~~cancel ~~including~~the ~~investor~~purchase ~~protections~~order; ~~and~~or ~~financial~~(2) ~~and~~accept ~~national~~that ~~security.~~the Trust will continue to Onattempt ~~June~~to 7,complete ~~2022~~the execution, Uwhich will delay the settlement date of the purchase order.S. ~~Senators~~With ~~Kirsten~~respect ~~Gillibrand~~to ~~and~~a ~~Cynthia~~purchase ~~Lummis~~order, ~~introduced~~as between the ~~“Responsible~~Trust ~~Financial~~and ~~Innovation~~the ~~Act~~Authorized Participant,” the Authorized Participant is responsible for the dollar cost of the difference abetween ~~bipartisan~~the ~~proposed~~Bitcoin ~~legislation~~price ~~that~~utilized ~~would~~in ~~create~~calculating aNAV ~~regulatory~~on ~~framework~~the ~~for~~trade ~~digital~~date ~~assets,~~and ~~including~~the aprice ~~standard~~at ~~for~~which ~~determining~~the Trust acquires the Bitcoin to the ~~which~~extent ~~digital~~the ~~assets~~price ~~are~~realized ~~commodities~~in ~~and~~buying ~~what~~the ~~are~~Bitcoin ~~securities,~~is ~~and~~higher ~~would~~than ~~assign~~the ~~regulatory~~Bitcoin ~~authority~~price ~~over~~utilized ~~digital~~in ~~asset~~the ~~spot~~NAV. ~~markets~~To the extent the price torealized in buying the ~~CFTC~~Bitcoin is lower than the price utilized in the NAV, the Authorized Participant shall keep the dollar impact of any such difference.

~~The~~Whether ~~effect~~the purchase of ~~any~~Bitcoin ~~future~~was ~~regulatory~~entered ~~change~~into onwith ~~the~~a ~~Trust~~Bitcoin Trading Counterparty or ~~Bitcoin~~via isthe ~~impossible~~Prime toExecution ~~predict~~Agent, ~~but~~ such ~~change~~party ~~could~~shall bedeliver Bitcoin ~~substantial~~related ~~and adverse~~to such transaction to the Trust’s ~~and~~Trading Account. This transfer is an “off-chain” transaction that is recorded in the ~~value~~books and records of the ~~Units~~Prime Execution Agent.

~~Foreign~~Because the ~~Legal~~Trust’s ~~and~~Trading ~~Regulatory~~Account may not be funded with cash on the trade date for the purchase of Bitcoin associated with the cash ~~Treatment~~purchase order, the Trust may borrow Trade Credits in the form of cash from the Lender (as defined herein) pursuant to the Trade Financing Agreement or may require the Authorized Participant to deliver the required cash for the cash purchase order on the trade date. The extension of Trade Credits on the trade date allows the Trust to purchase Bitcoin through the Prime Execution Agent on the trade date, with such Bitcoin being deposited in the Trust’s Trading Account. For settlement of a cash creation, the Trust delivers Shares to the Authorized Participant in exchange for cash received from the Authorized Participant. To the extent Trade Credits were utilized, the Trust uses the cash to repay the Trade Credits borrowed from the Lender.

~~Various~~Issuance foreign jurisdictions have, and may continue to, in the near future, adopt laws, regulations or directives that affect the Bitcoin Network, the Bitcoin markets and their users, particularly Bitcoin spot markets and service providers that fall within such jurisdictions’ regulatory scope. Such laws, regulations or directives may conflict with those of ~~the~~Baskets ~~United~~- ~~States~~Settlement and ~~may negatively impact the acceptance of~~ Bitcoin byVault users, merchants and service providers outside the United States and may therefore impede the growth or sustainability of the Bitcoin economy globally, or otherwise negatively affect the value of Bitcoin. The regulatory uncertainty surrounding the treatment of Bitcoin creates risks for the Trust.Transfers

OnUpon ~~March~~the 5,deposit ~~2020,~~by ~~South~~the ~~Korea~~Authorized ~~voted~~Participant toor ~~amend~~ its ~~Financial~~designated ~~Information~~agent ~~Act~~or toclient ~~require~~in ~~virtual~~connection ~~asset service providers to register and comply~~ with ~~its~~an ~~AML~~in-kind ~~and~~purchase ~~Combating~~order or the ~~Financing~~Bitcoin Trading ofCounterparty ~~Terrorism~~or ~~(“CFT”) framework. These measures also provide~~ the ~~government~~ ~~with~~Prime ~~the~~Execution ~~authority~~Agent toin ~~close~~connection ~~digital asset exchanges that do not comply~~ with ~~specified~~a ~~processes.~~cash ~~The~~purchase ~~Chinese~~order ~~and~~of ~~South Korean~~the ~~governments~~corresponding ~~have~~amount ~~also banned initial coin offerings (“ICOs”) and there are reports that Chinese regulators have taken action to shut down a number~~ of ~~China-based~~Bitcoin ~~digital asset exchanges. Further, on January 19, 2018, a Chinese news organization~~with ~~reported that~~ the ~~People~~Trust’s ~~Bank~~Trading ~~of China had ordered financial institutions to stop providing banking or funding to “any activity related to cryptocurrencies.” Similarly~~Account, inand ~~April 2018,~~ the ~~Reserve~~payment ~~Bank~~ of ~~India banned~~ the ~~entities~~applicable itETF ~~regulates from~~servicing ~~providing~~fee, ~~services~~and toof any ~~individuals~~expenses, taxes or ~~business~~charges ~~entities~~(such ~~dealing~~as stamp ~~with~~taxes or ~~settling~~stock ~~digital~~transfer ~~assets.~~taxes Onor ~~March 5~~fees), ~~2020, this ban was overturned in~~ the ~~Indian~~Cash ~~Supreme~~Custodian ~~Court,~~delivers ~~although~~ the ~~Reserve~~appropriate ~~Bank~~number of ~~India~~Baskets isto ~~currently~~the ~~challenging~~DTC ~~this~~account ~~ruling and, in December 2021, reportedly informed its central board~~ of ~~directors that it favors a complete ban on cryptocurrencies. There remains significant uncertainty regarding~~ the ~~South Korean, Indian and Chinese governments’ future actions with respect to the regulation~~ ofdepositing ~~digital~~Authorized ~~assets and digital asset exchanges~~Participant. ~~Such~~As ~~laws, regulations or directives may conflict with those~~ of the ~~United~~date ~~States and~~of ~~may~~this ~~negatively~~Annual ~~impact~~Report, the ~~acceptance~~Authorized ofParticipants ~~bitcoin~~are byMacquarie ~~users, merchants~~ and ~~service~~Jane ~~providers~~Street. ~~outside~~Additional Authorized ~~the~~Participants ~~United States, and~~ may ~~therefore~~ ~~impede~~be ~~the~~added ~~growth~~at orany ~~sustainability of the Bitcoin economy in the European Union~~time, ~~China,~~subject ~~Japan,~~to ~~Russia and~~ the ~~United States~~discretion ~~and~~of ~~globally, or otherwise negatively affect~~ the ~~value of Bitcoin~~Sponsor. ~~Other foreign jurisdictions including Canada, Germany and Sweden have also approved exchange-traded Bitcoin products.~~

In ~~July~~connection ~~2019,~~with the ~~United~~paragraph ~~Kingdom’s~~above, ~~Financial~~the ~~Conduct~~deposit ~~Authority~~of ~~proposed~~Bitcoin ~~rules~~is initially credited to ~~address~~the ~~harm~~Trust’s toTrading ~~retail~~Account ~~consumers~~with ~~deriving~~the ~~from~~Prime ~~the~~Execution ~~sale~~Agent ofbefore ~~derivatives~~being ~~and~~swept ~~exchange~~to ~~traded~~the ~~notes~~Trust’s ~~(“ETNs”)~~Vault ~~that~~Account ~~reference~~with ~~certain~~the ~~types~~Bitcoin ofCustodian ~~digital~~pursuant ~~assets,~~to ~~contending~~a regular end-of-day sweep ~~that~~process. ~~they~~Transfers ~~are~~of ~~“ill-suited”~~Bitcoin tointo ~~retail~~the ~~investors~~Trust’s ~~citing~~Trading ~~extreme~~Account ~~volatility,~~are ~~valuation~~off-chain ~~challenges~~transactions and ~~association~~transfers ~~with financial~~from ~~crime.~~the InTrust’s Trading ~~addition~~Account to ~~ETNs,~~ the ~~proposed~~Trust’s ~~ban~~Vault ~~would~~Account ~~affect~~are ~~financial~~“on-chain” ~~products~~transactions ~~including~~represented ~~contracts~~on ~~for~~the ~~differences,~~Bitcoin ~~options and futures~~blockchain. ~~Public~~Any costs ~~consultation~~related onto ~~the~~transactions ~~proposed~~and ~~restriction~~transfers ~~closed~~from inthe ~~October~~Trust’s ~~2019.~~Trading AAccount ~~determination~~to ~~that~~the ~~Bitcoin~~Trust’s isVault aAccount ~~security under~~are ~~U.S.~~borne orby ~~foreign~~the Prime ~~law~~Execution ~~could~~Agent ~~adversely~~(and ~~affect~~not anthe ~~investment~~Trust inor ~~the~~its ~~Units~~Shareholders).

Not a Regulated Commodity Pool

The Trust will not trade, buy, sell or hold Bitcoin derivatives, including Bitcoin futures contracts, swaps or options. The Trust is

~~authorized~~Because ~~solely~~the toSponsor ~~take~~has ~~immediate~~assumed ~~delivery~~what ofare ~~actual~~expected ~~Bitcoin.~~to ~~The~~be ~~Sponsor~~most ~~does~~of ~~not believe~~ the Trust’s ~~activities~~expenses, ~~are~~and ~~required~~the ~~to be~~Management ~~regulated~~Fee byaccrues daily at the ~~CFTC~~same rate, ~~under~~in the ~~CEA~~absence asof aany ~~“commodity~~Extraordinary ~~pool”~~Expenses ~~under~~or ~~current law~~liabilities, ~~regulation~~the ~~and~~amount ~~interpretation.~~of ~~The Trust~~Bitcoin by which the Basket Amount will ~~not~~decrease beeach day ~~operated~~is bypredictable. In connection with a ~~CFTC-regulated~~cash ~~commodity~~purchase ~~pool~~order, ~~operator~~the ~~because~~Trust itintends ~~will~~to ~~not~~have ~~trade,~~the ~~buy,~~Trust ~~sell~~Administrator ormake ~~hold~~available ~~Bitcoin~~on ~~derivatives,~~each ~~including~~Business ~~Bitcoin~~Day ~~futures~~an ~~contracts,~~indicative ~~swaps~~Basket orAmount ~~options~~for the next Business Day. ~~Unitholders~~Authorized ofParticipants ~~the~~may ~~Trust~~use ~~will~~that ~~not~~indicative ~~receive~~Basket Amount as guidance regarding the ~~regulatory~~amount ~~protections~~of ~~afforded~~ cash that they may expect to ~~investors~~have to deposit with the Trust Administrator in ~~regulated~~respect ~~commodity~~of ~~pools,~~cash ~~nor~~purchase orders ~~may~~placed ~~any~~by ~~futures~~them ~~exchange~~on ~~enforce~~such ~~its~~next ~~rules~~Business ~~with~~Day ~~respect~~and toaccepted by the Trust~~’s activities~~. The agreement entered into with each Authorized Participant Inprovides, ~~addition~~however, ~~Unitholders~~that ofonce a purchase order has been accepted by the Trust, ~~will~~the ~~not~~Authorized ~~benefit~~Participant ~~from~~is required to deposit with the ~~protections~~Trust ~~afforded~~Administrator the amount of U.S. dollars necessary to ~~investors~~purchase inthe Basket Amount of Bitcoin ~~futures~~in ~~contracts~~connection with a cash purchase order, as determined by the Trust on ~~regulated~~the ~~futures~~effective ~~exchanges~~date of the purchase order.

~~Custody~~No Shares ofcan ~~The~~be issued unless and until the Prime Execution Agent has informed the Trust that it has allocated to the Trust’s account ~~Bitcoins~~the corresponding amount of Bitcoin. Disruption of services at the Prime Execution Agent or Bitcoin Custodian would have the potential to delay settlement of the Bitcoin related to Share creations.

~~Digital~~Bitcoin ~~assets and digital asset~~ transactions ~~are~~that ~~recorded~~occur ~~and validated~~ on ~~blockchains,~~ the ~~public~~blockchain ~~transaction~~are ~~ledgers~~susceptible ofto adelays ~~digital~~due ~~asset network.~~to ~~Each~~Bitcoin ~~digital~~network ~~asset~~outage, ~~blockchain~~congestion, ~~serves~~spikes asin atransaction fees ~~record~~demanded ofby ~~ownership~~miners, ~~for~~or ~~all~~other ofproblems ~~the~~or ~~units~~disruptions. ofTo ~~such digital asset, even in~~ the ~~case~~ ofextent ~~certain~~that ~~privacy-focused~~Bitcoin ~~digital~~transfers ~~assets,~~from ~~where~~ the ~~transactions~~Trust’s ~~themselves~~Trading ~~are~~Account to ~~not~~the ~~publicly~~Trust’s ~~viewable.~~Vault ~~All~~Account ~~digital~~are ~~assets recorded~~delayed ondue ato ~~blockchain~~congestion ~~are~~or ~~associated~~other issues with athe ~~public~~Bitcoin ~~blockchain address~~network, ~~also~~such ~~referred~~Bitcoin towill asnot abe ~~digital wallet. Digital assets~~ held in atoffline a(cold) ~~particular~~storage ~~public~~in ~~blockchain~~the ~~address~~Vault ~~may~~Account beuntil ~~accessed~~such ~~and~~transfers ~~transferred~~can ~~using a corresponding private key~~occur.

~~Key~~Redemption of ~~Generation~~Baskets - In-Kind Redemptions

~~Public~~In ~~addresses~~connection ~~and~~with ~~their~~an ~~corresponding~~in-kind ~~private~~redemption, ~~keys~~an ~~are~~Authorized ~~generated~~Participant is required to submit a redemption order by the ~~Custodian~~In-Kind Order Cutoff Time. An Authorized Participant must submit an in-kind aredemption ~~proprietary~~order ~~key~~to ~~generation~~the ~~protocol~~Transfer ~~that~~Agent ~~generates cold~~indicating ~~storage~~the ~~addresses~~number ~~for~~of ~~Coinbase~~Baskets ~~Custody~~it ~~digital~~intends to ~~wallets~~redeem. ~~This~~The ~~key~~date ~~generation~~the ~~architecture~~Transfer isAgent ~~performed~~receives ~~completely~~that ~~offline,~~order determines the Basket Amount in connection with an in-kind redemption to be ~~affording~~received ~~maximum~~in ~~protection~~exchange. ~~against~~However, ~~malicious~~orders ~~attacks~~received by the Transfer Agent after the In-Kind Order Cutoff Time on a Business Day will not be accepted and ~~illicit~~should ~~actors~~be resubmitted on the following Business Day.

~~Once~~On ~~generated,~~the ~~private~~order ~~keys~~date ~~are~~the ~~encrypted,~~Trust ~~separated~~instructs ~~into~~the ~~“shards”~~Bitcoin ~~and~~Custodian ~~then~~to ~~further~~prepare ~~encrypted.~~to ~~After~~move the ~~key~~associated ~~generation,~~Bitcoin from the Trust’s Vault Account ~~all~~with ~~materials~~the ~~used~~Bitcoin Custodian to ~~generate~~the ~~private~~Trust’s ~~keys~~Trading ~~are~~Account ~~generally~~with ~~destroyed.~~the ~~All~~Prime ~~key~~Execution ~~generation~~Agent. ~~ceremonies~~For ~~are~~settlement ~~performed~~of ~~offline.~~a Noredemption, ~~party~~the Authorized ~~other~~Participant ~~than~~delivers the ~~Custodian~~necessary ~~has~~Shares ~~access~~ to the ~~private~~Trust, ~~key~~the ~~shards~~Trust instructs the Prime Execution Agent to deliver Bitcoin to the account of the ~~Trust~~Authorized Participant or its designated agent or client’s account at the Prime Execution Agent.

~~Key~~Transfers of ~~Storage~~Bitcoin from the Trust’s Vault Account to the Trust’s Trading Account are “on-chain” transactions represented on the Bitcoin blockchain.

~~Private~~Bitcoin ~~key~~transactions ~~shards~~that occur on the blockchain are ~~distributed~~susceptible ~~geographically~~to indelays ~~secure~~due ~~vaults~~to ~~around~~Bitcoin ~~the~~network ~~world~~outages, ~~including~~congestion, spikes in ~~the~~transaction fees ~~United~~demanded ~~States~~by miners, or other problems or disruptions. ~~The~~To ~~locations~~the ofextent that Bitcoin transfers from the ~~secure~~ ~~vaults~~Trust’s ~~may~~Vault ~~change~~Account to ~~regularly~~the ~~and~~Trust’s Trading Account are ~~kept~~delayed ~~confidential~~due byto congestion or other issues with the ~~Custodian~~Bitcoin ~~for~~network ~~security~~or ~~purposes~~the Trust’s operations, redemptions in the Trust could be delayed.

~~The~~Disruption Custodial Account uses offline storage, or “cold storage,” mechanisms to secure the Trust’s private keys. The term cold storage refers to a safeguarding method by which the private keys corresponding to digital assets are disconnected and/or deleted entirely from the internet. Cold storage of ~~private~~services ~~keys~~at ~~may involve keeping such keys on a non-networked (or “airgapped”) computer or electronic device or storing~~ the ~~private~~Prime ~~keys~~Execution onAgent ~~a storage device (for example, a USB thumb drive)~~ or ~~printed~~Bitcoin ~~medium (for~~Custodian ~~example,~~would ~~papyrus,~~have ~~paper or a metallic object). A digital wallet may receive deposits of digital assets but may not send digital assets without use of~~ the ~~digital~~potential ~~assets’ corresponding private keys. In order~~ to ~~send~~delay ~~digital~~settlement ~~assets~~of ~~from a digital wallet in which~~ the ~~private~~Bitcoin ~~keys~~related ~~are kept in cold storage, either the private keys must be retrieved from cold storage and entered into an online, or “hot,” digital asset software program~~ to ~~sign the transaction, or the unsigned transaction must be transferred~~ toShare ~~the cold server in which the private keys are held for signature by the private keys and then transferred back to the online digital asset software program~~redemptions. ~~At that point, the user of the digital wallet can transfer its digital assets.~~

~~Under~~Redemption the Custodial Services Agreement, the Custodian holds Bitcoin for the Trust in a segregated account. The Custodian stores all private keys in cold storage and requires up to 24 hours between any request to withdraw Bitcoin from the Custodial Account and submission of ~~the~~Baskets ~~withdrawal~~- toCash the Bitcoin Network. As of the date of this filing, the Trust holds one (1) cold storage wallet with the Custodian. The Custodial Services Agreement states that the Custodian’s maximum liability for each cold storage wallet shall be limited to $100,000,000. Our trading department, which monitors the value within each cold storage wallet on a daily basis, will engage the Custodian for the creation of an additional cold storage wallet once the value exceeds $75,000,000. The Custodian recommends that, as a best practice, each cold storage wallet should not exceed $80,000,000 notwithstanding the Custodian’s maximum liability of $100,000,000 for each cold storage wallet.Redemptions

~~Security~~In connection ~~Procedures~~with a cash redemption, an Authorized Participant is required to submit a cash redemption order by the Cash Order Cutoff Time. An Authorized Participant must submit a redemption order to the Transfer Agent indicating the number of Baskets it intends to redeem. The date the Transfer Agent receives that order determines the Basket Amount in connection with a cash redemption to be received in exchange. However, orders received by the Transfer Agent after the Cash Order Cutoff Time on a Business Day will not be accepted and should be resubmitted on the following Business Day.

~~The~~On ~~Custodian~~the isdate of the ~~custodian~~Cash ofOrder Cutoff Time, the Trust’s ~~private~~may ~~keys~~choose, in ~~accordance~~its sole discretion, to enter into a transaction with a Bitcoin Trading Counterparty or the ~~terms~~Prime ~~and~~Execution ~~provisions~~Agent to sell Bitcoin in exchange for cash. Also, on the date of the ~~Custodial~~Cash ~~Services~~Order Cutoff ~~Agreement.~~Time, ~~Transfers~~the Trust instructs the Bitcoin Custodian to prepare to move the associated Bitcoin from the ~~Custodial~~Trust’s Vault Account ~~requires~~with the ~~certain~~Bitcoin ~~security~~Custodian ~~procedures~~to the Trust’s Trading Account with the Prime Execution Agent. For settlement of a redemption, ~~including~~the Authorized ~~but~~Participant ~~not~~delivers ~~limited~~the necessary Shares to the Trust, ~~multiple~~a ~~encrypted~~Bitcoin Trading Counterparty or the Prime Execution Agent, as ~~private~~applicable, ~~key~~delivers ~~shards~~the cash to the Trust associated with the Trust’s sale of Bitcoin, ~~usernames~~the Trust delivers Bitcoin to the Bitcoin Trading Counterparty’s account at the Prime Execution Agent or directly to the Prime Execution Agent, ~~passwords~~as applicable, and ~~two-step~~the ~~verification~~Trust delivers cash to the Authorized Participant. ~~Multiple~~In ~~private~~the ~~key~~event ~~shards~~that ~~held~~the Trust has not been able to successfully execute and complete settlement of a Bitcoin transaction by the ~~Custodian~~settlement ~~must~~date, the Authorized Participant will be ~~combined~~given the option to (1) cancel the redemption order; or (2) accept that the Trust will continue to ~~reconstitute~~attempt to complete the ~~private~~execution, ~~key~~which will delay the settlement date. With respect to ~~sign~~a ~~any~~redemption ~~transaction~~order, between the Trust and the Authorized Participant, the Authorized Participant will be responsible for the dollar cost of the difference between the Bitcoin price utilized in calculating the NAV on the trade date and the price realized in selling the Bitcoin to raise the cash needed for the cash redemption order to ~~transfer~~the extent the ~~Trust’s~~price realized ~~assets~~in selling the Bitcoin is lower than the Bitcoin price utilized in the NAV. ~~Private~~To ~~key~~the ~~shards~~extent ~~are~~the ~~distributed geographically~~price realized in ~~secure~~selling ~~vaults~~the Bitcoin ~~around~~is higher than the ~~world,~~price ~~including~~utilized in the ~~United~~NAV, ~~States~~the Authorized Participant shall get to keep the dollar impact of any such difference.

As a result, if any one secure vault is ever compromised, this event will have no impact on the ability of the Trust to access its assets,

The transfers ~~other~~of ~~than~~Bitcoin afrom ~~possible~~the ~~delay~~Trust’s inTrading ~~operations,~~Account ~~while~~to ~~one~~the orBitcoin ~~more~~Trading ofCounterparty’s ~~the~~account ~~other~~at ~~secure~~the ~~vaults~~Prime isExecution Agent ~~used~~or ~~instead.~~to ~~These~~the ~~security procedures~~Prime ~~are~~Execution ~~intended~~Agent tois ~~remove~~an ~~single~~“off-chain” ~~points~~transaction ofthat ~~failure~~is recorded in the ~~protection~~books and records of the ~~Trust’s~~Prime Execution ~~assets~~Agent.

~~Transfers~~The Trust’s Trading Account with the Prime Execution Agent may not be funded with Bitcoin on the trade date for the sale of ~~Bitcoins~~Bitcoin in connection with the redemption order, when Bitcoin remains in the Trust’s Vault Account with the Bitcoin Custodian at the point of intended execution of a sale of Bitcoin. In those circumstances the Trust may borrow Trade Credits in the form of Bitcoin from the Lender, which allows the Trust to sell Bitcoin through the ~~Custodial~~Prime Execution Agent on the trade date, and the cash proceeds are deposited in the Trust’s Trading Account ~~will~~with bethe ~~available~~Prime Execution Agent. For settlement of a redemption where Trade Credits were utilized, the Trust delivers cash to the Authorized Participant in exchange for Shares received from the Authorized Participant. In the event Trade Credits were used, the Trust ~~once~~will ~~processed~~use onthe Bitcoin moved from the ~~Blockchain~~Trust’s Vault Account with the Bitcoin Custodian to the Trading Account with the Prime Execution Agent to repay the Trade Credits borrowed from the Lender.

~~Subject~~Transfers ~~to obtaining regulatory approval to operate a redemption program and authorization~~ of ~~the~~Bitcoin ~~Sponsor, the process of accessing and withdrawing Bitcoins~~ from the Trust’s toVault ~~redeem~~Account ~~a Unit by a Unitholder will follow the same general procedure as transferring Bitcoins~~ to the Trust’s toTrading ~~create~~Account aare ~~Unit~~“on-chain” bytransactions arepresented on ~~Unitholder,~~the ~~only~~Bitcoin ~~in reverse~~blockchain. ~~See “Description of Issuance of Units.”~~

~~Description~~Bitcoin transactions ofthat ~~Issuance~~occur ofon the blockchain are susceptible to delays due to Bitcoin network outages, congestion, spikes in transaction ~~Units~~fees demanded by miners, or other problems or disruptions. To the extent that Bitcoin transfers from the Trust’s Vault Account to the Trust’s Trading Account are delayed due to congestion or other issues with the Bitcoin network or the Trust’s operations, redemptions in the Trust could be delayed.

~~The~~Disruption ~~following is a description~~ of ~~the~~services ~~material~~at ~~terms of~~ the ~~Trust~~Prime ~~documents~~Execution asAgent, ~~they~~Bitcoin ~~relate~~Custodian, toCash ~~the~~Custodian ~~issuance~~or of the ~~Trust~~Authorized Participant’s ~~Units on~~banks anwould ~~ongoing~~have ~~basis~~the potential ~~from time~~ to ~~time~~delay ~~through~~settlement ~~sales~~of ~~in private placement transactions exempt from~~ the ~~registration~~Bitcoin ~~requirements of~~related ~~the~~to ~~Securities~~Share ~~Act~~redemptions.

~~The~~Redemption ~~Units~~of ~~are~~Baskets ~~offered directly by the Trust and the Sponsor and its officers, in reliance upon the exemption from broker registration contained in Rule 3a4~~-1 of the Exchange Act. Currently, the Trust does not expect to use intermediaries such as underwriters, finders or other such intermediaries to offer or sell Units, but it may choose to do so, and in any such case pay the fees of such intermediaries itself or pass some or all of such fees on to purchasers (in which case the Trust will make advanced disclosure of such fee arrangements to such purchasers).Settlement

~~The~~Upon ~~current~~the ~~legal~~surrender ~~framework~~of ~~has~~Shares ~~made~~and itthe ~~difficult~~payment ~~for~~of the ~~Trust~~applicable totransaction ~~permit~~fee ~~redemptions~~and of ~~our~~any ~~Units~~expenses, ~~because~~taxes weor ~~are~~charges ~~unable~~(such toas ~~conduct~~stamp taxes ~~concurrent~~or ~~offerings~~stock ~~and~~transfer ~~redemptions~~taxes ofor ~~our~~fees) ~~Units.~~by Asthe redeeming Authorized Participant, and the completion of the ~~date~~sale of ~~this~~Bitcoin ~~filing~~in exchange for cash by the Trust in connection with a cash redemption order, the Trust ~~has~~(1) ~~not~~instructs ~~accepted~~the ~~new~~Prime ~~purchases~~Execution ~~for over~~Agent ~~one~~to ~~year,~~deliver ~~and~~from wethe ~~have~~Trust’s Trading noAccount ~~present~~to ~~intention~~the account of ~~reopening~~the ~~sales~~Authorized ofParticipant ~~Units.~~or Weits ~~are~~agent ~~considering~~or aclient, ~~redemption~~the ~~program~~amount ~~for~~of ~~investors~~Bitcoin corresponding to the redeemed Baskets in ~~the~~connection ~~Trust.~~with ~~Any~~an in-kind redemption ~~program~~order; ~~would~~or ~~likely~~(2) ~~involve~~instructs ~~limited~~the ~~periodic~~delivery ~~redemptions~~ of ~~Units,~~cash ~~although~~to wethe ~~have~~Authorized ~~not~~Participant ~~ruled~~in ~~out~~connection ~~the~~with ~~possibility~~a ofcash anredemption ~~open-ended~~order. Shares can only be surrendered for redemption ~~program~~in Baskets.

~~The~~Suspension ~~Trust~~or isRejection ~~authorized under the Trust Agreement to issue an unlimited number~~ of ~~Units.~~Creation ~~The~~or ~~Trust~~Redemption issues Units only in connection with purchase orders for a minimum of $25,000 initial investment ($10,000 minimum for additional investments). The Units represent common units of fractional undivided beneficial interest in and ownership of the Trust and have no par value.Orders

The ~~Units~~Sponsor may, bein ~~purchased~~its ~~from~~discretion, suspend the ~~Trust~~right of creation or redemption, or postpone the redemption settlement date, (1) for any period during which the Listing Exchange is closed other than customary weekend or holiday closings, or trading on the Listing Exchange is suspended or restricted; (2) for any period during which an ~~ongoing~~emergency ~~basis~~(for example, ~~but~~an ~~only~~interruption ~~upon~~in services or availability of the Bitcoin Custodian, Cash Custodian, Trust Administrator, or other service providers to the Trust, act of God, catastrophe, civil disturbance, government prohibition, war, terrorism, strike or other labor dispute, fire, force majeure, interruption in telecommunications, order entry systems, internet services, or network provider services, unavailability of anFedwire, ~~Accredited~~SWIFT ~~Investor~~or tobanks’ ~~purchase~~payment aprocesses, ~~minimum~~significant technical failure, bug, error, disruption or fork of ~~$25~~the Bitcoin network,~~000~~ hacking, cybersecurity breach, or power, internet, or Bitcoin network outage, or similar event) exists as a result of ~~Units~~which ~~initial~~delivery, ~~investment~~disposal or evaluation of Bitcoin is not reasonably practicable; or (~~$10,000~~3) ~~minimum~~for such other period as the Sponsor determines to be necessary for ~~additional~~the ~~investments)~~protection of the Shareholders. AsFor example, the Sponsor may determine that it is necessary to suspend redemptions to allow for the orderly liquidation of ~~January~~the 6Trust’s assets. If the Sponsor has difficulty liquidating the Trust’s positions (e.g., ~~2023~~because of a market disruption event or an unanticipated delay in the liquidation of a position in an over-the-counter contract), ~~each~~it ~~Unit~~may ~~represented~~be appropriate to suspend redemptions until such time as such circumstances are 0rectified.~~00033~~ None of athe ~~Bitcoin~~Sponsor, the person authorized to take redemption orders in the manner provided in the Authorized Participant Agreement, or the Custodians are liable to any person or in any way for any loss or damages that may result from any such suspension or postponement.

Accredited Investors are the only persons that may place orders to purchase Units (the “Purchasers”). Each Purchaser must (i) enter into a subscription agreement with the Sponsor and the Trust, and (ii) if purchasing in-kind, have access to a Bitcoin digital wallet address previously known to the Custodian as belonging to the Purchaser (the “Purchaser Self-Administered Account”).

The creation of Units requires the delivery to the Trust of the Bitcoin Purchase Amount.

The subscription agreement provides the procedures for the creation of Units and for the delivery of the whole and fractional Bitcoins required for such creations. The subscription agreement and the related procedures attached thereto may be amended by the Sponsor and the relevant Purchaser. Under the subscription agreement, the Sponsor has agreed to indemnify each Purchaser against certain liabilities, including liabilities under the Securities Act. If and when the Trust has an active offering of Units and the Trust determines an announcement of a halting of subscription agreement offerings is necessary for the best interest of the Trust and the investors, such as when the Units are trading at a discount to the NAV, it will post such information on its website at https://ospreyfunds.io/onboarding/.

Purchasers do not pay a transaction fee to the Trust in connection with the creation of Units, but there may be transaction fees associated with the validation of the transfer of Bitcoins by the Bitcoin Network. Purchasers who deposit Bitcoins with the Trust in exchange for Units will receive no fees, commissions or other form of compensation or inducement of any kind from either the Sponsor or the Trust, and no such person has any obligation or responsibility to the Sponsor or the Trust to effect any sale or resale of Units. The following description of the procedures for the creation of Units is only a summary and Unitholders should refer to the relevant provisions of the Trust Agreement and the form of subscription agreement for more detail.

Purchase Procedures

On any Business Day, a Purchaser may deposit the amount of cash to purchase Units (the “Bitcoin Purchase Amount”) with the Trust’s bank (i.e., the bank providing the Trust with banking services) and submit an order to create Units (a “Purchase Order”) from the Trust via notification to the Sponsor or its delegate in the manner provided in the subscription agreement. An investor’s cash for a Purchase

The Sponsor ~~Order~~acting ~~must~~by beitself ~~cleared~~or through the person authorized to take creation or redemption orders in the ~~Trust’s~~manner ~~bank~~provided ~~account~~in bythe ~~1:00~~Authorized Participant ~~p.m.~~Agreement may, ~~Eastern~~in ~~time~~its onsole adiscretion, ~~Business~~reject ~~Day~~any ~~for~~creation redemption order (1) the ~~investor~~ Sponsor determines not to ~~obtain~~be ~~that~~in ~~day’s~~proper form; ~~Bitcoin~~(2) ~~Market~~the ~~Price.~~fulfillment ~~The~~of which its counsel advises may be illegal under applicable laws and regulations; or (3) if circumstances outside the control of the Sponsor, the person authorized to take creation or ~~its~~redemption ~~delegate~~orders ~~will~~in ~~process~~the ~~Purchase~~manner ~~Orders~~provided ~~only~~in ~~from~~the ~~Purchasers~~Authorized ~~with~~Participant ~~respect~~Agreement or the Bitcoin Custodian make it for all practical purposes not feasible for the Shares to ~~whom~~be delivered under the creation or redemption order. The Sponsor may also reject a ~~subscription~~redemption ~~agreement~~order isif inthe ~~full~~number ~~force~~of ~~and~~Shares ~~effect~~being redeemed would reduce the remaining outstanding Shares to 10,000 Shares (i.e., 1 Basket) or less.

~~Once the Sponsor or~~None ~~its delegate confirms the total amount~~ of ~~purchase funds for a Purchase Order, it will choose a counterparty to purchase Bitcoin on agreed upon terms. The Sponsor has full discretion to determine~~ the Trust~~’s counterparties for Bitcoin transactions. The Sponsor considers various counterparties for trades~~, including Cumberland DRW, LLC; Jane Street; Galaxy Digital; and Wintermute Trading Ltd., based on various factors including, but not limited to, price quoted, ease of liquidity, marketplace slippage (i.e., price certainty) and ease and certainty of settlement. Upon receiving a trade confirmation from the ~~counterparty~~Sponsor, the ~~Sponsor~~Transfer ~~will instruct~~Agent, ~~the~~or ~~Trust’s bank to wire funds to~~ the ~~trading~~Custodians ~~counterparty~~are ~~and~~liable ~~confirm the digital wallet address~~ for the ~~Trust to~~rejection ~~receive~~of ~~Bitcoin~~any atpurchase ~~the~~order ~~Custodian~~or Basket.

~~Completed Purchase Orders~~In ~~are~~the ~~generally~~event ~~accepted~~that ~~(or rejected) by~~ the Sponsor ~~within~~intends ~~one~~to ~~Business~~suspend ~~Day~~or ofpostpone ~~the~~creations ~~day~~or ~~on which the relevant Purchase Order is placed. If a Purchase Order is accepted~~redemptions, ~~the~~it ~~Sponsor generally~~ will ~~fill~~provide ~~the~~Shareholders ~~Purchaser’s~~with ~~Purchase~~notice ~~Order~~in ~~within~~a ~~five Business~~prospectus ~~Days~~supplement ~~immediately following the day on which the relevant Purchase Order is placed. The expense~~ and/or ~~risk~~through ofa ~~delivery,~~current ~~ownership and~~report ~~safekeeping~~on ofForm ~~Bitcoins~~8-K ~~will~~or bein ~~borne solely by~~ the ~~Purchaser~~Trust’s ~~until~~annual ~~such~~or ~~Bitcoin~~quarterly ~~have been received by the Trust~~reports.

~~In-Kind~~Creation and ~~Subscriber~~Redemption ~~Subscriptions~~Transaction Fee

~~Units~~To compensate ~~may~~for beexpenses ~~purchased through~~incurred in~~-kind~~ ~~contributions~~connection with the creation and redemption of ~~Bitcoin~~Baskets, atan ~~the~~Authorized ~~sole~~Participant ~~discretion~~is ofrequired to pay a standard transaction fee to create or redeem Baskets, which is not expected to vary in accordance with the ~~Sponsor~~number of Baskets in such order. The ~~minimum~~total ~~initial~~transaction ~~subscription~~fee ~~amount~~also isincludes ~~$25~~applicable taxes,~~000~~ brokerage and anany ~~existing~~other ~~Unitholder~~commissions, ~~may~~transaction ~~make~~fees ~~additional~~(including financing), ~~subscriptions~~trade inslippage aand ~~minimum~~market ~~amount~~impact ofcosts, ~~$10~~as applicable,~~000~~ and may be reduced, ~~subject~~increased inor ~~all~~otherwise ~~cases~~changed toby ~~increase, decrease~~the Sponsor and ~~waiver~~the ofTrust ~~such~~based ~~requirements~~on bychanges to the costs or inputs associated with the total transaction fee. The Sponsor, will notify Authorized Participants of any change in ~~its~~the ~~sole~~transaction ~~discretion~~fee and will not implement any change in the fee until after the date of notice.

Our calculation surrounding the number of Units issued upon each purchase through in-kind contributions is described and demonstrated below, which illustrates a hypothetical transaction taking place on January 5, 2023:

1. Use 4:00 pm, New York time price of the principal market to determine USD value of in-kind subscription received. For example, 2 Bitcoins received on January 5, 2023 (2*$16,854.30 = $33,708.60);

2. Use 4:00 pm, New York time, NAV per Unit price: $5.6138 NAV per Unit on January 5, 2023;

3. Calculate the maximum number of whole Units that can be purchased at the price determined in step 2 with the proceeds determined in step 1: ($33,708.60/$5.6138 = 6,004 whole Units);

4. Calculate the total value of those Units: 6,004 whole Units * $5.6138 NAV per Unit = $33,705.26;

5. Calculate the difference between the proceeds received in step 1 and the value of the Units in Step 4: $33,708.60 - $33,705.26 = $3.34;

6. The unapplied USD amount for purchase of new Units (rounding difference) is allocated to the Trust as “Other Earnings”: $3.34.

Pursuant to the representations and warranties made in the Subscription Agreement, investors are not permitted to withdraw either the cash subscriptions or in-kind subscriptions after the Bitcoin has been valued.

Suspension or Rejection of Purchase Orders and Bitcoin Purchase Amount

The delivery of the Units against deposit of the Bitcoin Purchase Amount may be suspended generally, or refused with respect to particular requested creations, during any period when the transfer books of the Sponsor or its delegate are closed or if any such action is deemed necessary or advisable by the Sponsor or its delegate or for any reason at any time or from time to time. None of the Sponsor, its delegates, or the Custodian shall be liable for the rejection or acceptance of any Purchase Order or Bitcoin Purchase Amount.

Tax Responsibility

~~Purchasers~~Authorized Participants are responsible for any transfer tax, sales or use tax, stamp tax, recording tax, value- added tax or similar tax or governmental charge applicable to the creation or redemption of ~~Units~~Baskets, regardless of whether or not such tax or charge is imposed directly on the Authorized ~~Purchasers~~Participant, and agree to indemnify the Sponsor and the Trust if ~~the~~they ~~Sponsor~~are ~~or the Trust is~~ required by law to pay any such tax ~~or charge~~, together with any applicable penalties, additions to tax orand interest thereon.

~~Certain U.S. Federal Income~~Secondary ~~Tax~~Market ~~Consequences~~Transactions

As discussed above, Authorized Participants are the only persons that may place orders to create and redeem Baskets. Authorized Participants must be registered broker-dealers or other securities market participants, such as banks and other financial institutions that are not required to register as broker-dealers to engage in securities transactions. An Authorized Participant is under no obligation to create or redeem Baskets, and an Authorized Participant is under no obligation to offer to the public Shares of any Baskets it does create.

Authorized Participants that do offer to the public Shares from the Baskets they create do so at per-Share offering prices that are expected to reflect, among other factors, the trading price of the Shares on the Listing Exchange, the NAV of the Trust at the time the Authorized Participant purchased the Baskets, the NAV of the Shares at the time of the offer of the Shares to the public, the supply of and demand for Shares at the time of sale, and the liquidity of Bitcoin or other portfolio investments. Baskets are generally redeemed when the price per Share is at a discount to the NAV per Share. Shares initially comprising the same Basket but offered by Authorized Participants to the public at different times may have different offering prices. An order for one or more Baskets may be placed by an Authorized Participant on behalf of multiple clients. Authorized Participants who make deposits with the Trust in exchange for Baskets receive no fees, commissions or other forms of compensation or inducement of any kind from either the Trust or the Sponsor and no such person has any obligation or responsibility to the Sponsor or the Trust to effect any sale or resale of Shares. Shares trade in the secondary market on the Listing Exchange.

Description of the Shares and the Trust Agreement

General

The Trust is authorized under the Trust Agreement to create and issue an unlimited number of Shares. Shares are issued only in Baskets and only upon the order of an Authorized Participant. The Shares represent common units of fractional undivided beneficial interest in and ownership of the Trust and have no par value.

Description of Limited Rights

The Shares do not represent a traditional investment and should not be viewed as similar to “shares” of a corporation operating a business enterprise with management and a board of directors. A Shareholder does not have the statutory rights normally associated with the ownership of Shares of a corporation. Each Share is transferable (except to the extent restricted under the Securities Act), is fully paid and non-assessable and entitles the holder to vote on the limited matters upon which Shareholders may vote under the Trust Agreement. For example, Shareholders do not have the right to elect directors and are not entitled to receive dividends. The Shares do not entitle their holders to any conversion or preemptive rights or, except as discussed below, any redemption rights or rights to distributions.

~~The~~Voting ~~following~~and discussion addresses the material U.S. federal income tax consequences of the ownership of Units. This discussion does not describe all of the tax consequences that may be relevant to a beneficial owner of Units in light of the beneficial owner’s particular circumstances, including tax consequences applicable to beneficial owners subject to special rules, such as:Approvals

•The Shareholders ~~financial~~take ~~institutions;~~no part in the management or control of the Trust. Under the Trust Agreement, Shareholders have limited voting rights. However, no amendments to the Trust Agreement that materially adversely affect the interests of Shareholders may be made without the vote of at least a majority (over 50%) of the Shares (not including any Shares held by the Sponsor or its affiliates). The Sponsor may generally make any other amendments to the Trust Agreement in its sole discretion without Shareholders’ consent.

~~• dealers in securities or commodities;~~Distributions

•Pursuant to ~~traders~~the interms ~~securities~~of orthe ~~commodities~~Trust ~~that~~Agreement, ~~have~~the ~~elected~~Trust tomay ~~apply~~make adistributions ~~mark-to-market~~on ~~method~~its ofShares ~~tax~~in ~~accounting~~cash or in ~~respect~~Shares, ~~thereof;~~with such frequency as the Sponsor may determine.

•In addition, ~~persons~~if ~~holding~~the ~~Units~~Trust asis ~~part~~terminated and liquidated, the Sponsor will distribute to the Shareholders any amounts of athe ~~hedge,~~cash ~~“straddle~~proceeds (or Bitcoin) of the liquidation remaining after the satisfaction of all outstanding liabilities of the Trust and the establishment of reserves for applicable taxes,” ~~integrated~~other ~~transaction~~governmental charges and contingent or ~~similar~~future ~~transaction;~~liabilities as the Sponsor will determine. Shareholders of record on the record date fixed by the Transfer Agent for a distribution will be entitled to receive their pro rata portions of any distribution.

~~• Accredited Investors;~~Book-Entry Form

•Shares of Uthe Trust are held in book-entry form by the Transfer Agent.S Transfers are made in accordance with standard securities industry practice. The ~~Holders~~Sponsor or its delegate shall (asi) ~~defined~~direct ~~below~~the Transfer Agent to credit or debit the number of creation Baskets or redemption Baskets to the account of the applicable purchaser; and (ii) ~~whose~~issue ~~functional~~or ~~currency~~cancel iscreation ~~not~~Baskets or redemption Baskets, as applicable, at the Udirection of the Sponsor or its delegate.S. ~~dollar;~~The Transfer Agent shall issue or cancel each purchaser’s Shares, as applicable.

~~• entities or arrangements classified as partnerships for U.S. federal income tax purposes;~~Share Splits

•In its Sdiscretion, ~~corporations;~~the Sponsor may direct the Transfer Agent to declare a split or reverse split in the number of Shares outstanding and to make a corresponding change in the number of Shares constituting a Basket. For example, if the Sponsor believes that the per Share price in the secondary market for Shares has risen or fallen outside a desirable trading price range, it may declare such a split or reverse split.

•Description of ~~persons~~the ~~receiving~~Trust ~~Units as compensation;~~Agreement

•The following ~~persons~~is ~~that~~a ~~are~~description ~~expatriates~~of orthe ~~former~~material ~~citizens~~terms orof ~~long-term~~the ~~residents~~Trust Agreement. The Trust Agreement establishes the roles, rights and duties of the ~~United~~Sponsor ~~States;~~and the Trustee.

• a “controlled foreign corporation” or a person who is treated as a “United States shareholder” thereof, a “passive foreign investment company” or a shareholder thereof, or a corporation that accumulates earnings to avoid U.S. federal income tax;The Sponsor

•Liability of ~~real~~the ~~estate~~Sponsor ~~investment~~and ~~trusts;~~Indemnification

•Each Covered ~~regulated~~Person ~~investment~~is ~~companies;~~not ~~and~~liable to the Trust or any Shareholder for any action taken, or for refraining from taking any action in good faith, having determined that such course of conduct was in the best interests of the Trust. However, the preceding liability exclusion does not protect the Sponsor against any liability resulting from its own willful misconduct, bad faith or gross negligence in the performance of its duties.

•Each Covered ~~tax-exempt~~Person ~~entities~~is indemnified by the Trust and held harmless against any loss, judgment, liability, expense incurred or amount paid in settlement of any claim sustained by it in connection with the Covered Person’s activities for the Trust, without fraud, gross negligence, bad faith, willful misconduct or a material breach of the Trust Agreement on the part of such indemnified party arising out of or in connection with the performance of its obligations under the Trust Agreement and under each other agreement entered into by the Sponsor in furtherance of the administration of the Trust (including, ~~individual~~without ~~retirement~~limiting ~~accounts~~the scope of the foregoing, any subscription agreement) or any actions taken in accordance with the provisions of the Trust Agreement. Such indemnity shall include payment from the Trust of the costs and expenses incurred by such indemnified party in defending itself against any claim or liability in its capacity as Sponsor. Any amounts payable to an indemnified party may be payable in advance or shall be secured by a lien on the Trust. The Sponsor may, in its discretion, undertake any action that it may deem necessary or desirable in respect of the Trust Agreement and the interests of the Shareholders and, in such event, the legal expenses and costs of any such actions shall be expenses and costs of the Trust and the Sponsor shall be entitled to be reimbursed therefor by the Trust.

This discussion applies only to Units that are held as capital assets and does not address alternative minimum tax consequences or consequences of the tax on net investment income.

If an entity or arrangement that is classified as a partnership for U.S. federal income tax purposes holds Units, the U.S. federal income tax treatment of a partner will generally depend on the status of the partner and the activities of the partnership. Partnerships holding Units and partners in those partnerships are urged to consult their tax advisers about the particular U.S. federal income tax consequences of owning Units.

This discussion is based on the Internal Revenue Code of 1986, as amended (the “IRC”), administrative pronouncements, judicial decisions, and final, temporary and proposed Treasury regulations as of the date hereof. Changes in U.S. federal income tax law, Treasury regulations and future published rulings and administrative procedures of the Internal Revenue Service (“IRS”) in response to these changes in U.S. federal income tax laws, could materially affect the tax consequences of an investor’s investment in the Units, and the tax treatment of the Trust’s investments. While some of these changes may be beneficial, others could negatively affect the after-tax returns of the Trust and its investors. Accordingly, no assurance can be given that the currently anticipated tax treatment of an investment in the Trust, or of investments made by the Trust, will not be modified by legislative, judicial, or administrative changes, possibly with retroactive effect, to the detriment of the investors. For the avoidance of doubt, this summary does not discuss any tax consequences arising under the laws of any state, local or foreign taxing jurisdiction. Unitholders are urged to consult their tax advisers about the application of the U.S. federal income tax laws to their particular situations, as well as any tax consequences arising under the laws of any state, local or foreign taxing jurisdiction.

Tax Treatment of the Trust

The Sponsor intends to take the position that the Trust is properly treated as a grantor trust for U.S. federal income tax purposes. The Trust has not obtained a ruling from the IRS or an opinion of counsel as to the status of the Trust, and there cannot be any assurances

~~as to the federal income tax classification of the Trust. Assuming that the Trust is a grantor trust, the Trust will~~Fiduciary ~~not be subject to U.S. federal income tax. Rather, each beneficial owner of Units will be treated as directly owning its pro rata share of the Trust’s assets~~ and aRegulatory ~~pro~~Duties ~~rata portion~~ of the ~~Trust’s income, gain, losses and deductions will “flow through” to each beneficial owner of Units.~~Sponsor

The ~~Trust expects~~ toSponsor ~~take~~is ~~certain~~not ~~positions~~effectively ~~with~~subject ~~respect~~ to the ~~tax~~duties ~~consequences of Incidental Rights~~ and ~~its~~restrictions ~~receipt~~imposed ofon ~~Additional~~“fiduciaries” ~~Currency.~~under ~~The Trust~~both ~~does~~statutory ~~not~~and ~~expect to take into account any Additional Currency it may hold for purposes of determining the Trust’s Bitcoin~~common ~~Holdings~~law. orRather, the ~~Bitcoin~~general ~~Holdings~~fiduciary ~~per~~duties ~~Unit.~~that ~~With~~would ~~respect~~apply to ~~any fork, airdrop or similar event,~~ the Sponsor ~~may,~~are indefined ~~its discretion, accept the assets~~ and ~~distribute~~limited ~~the~~in ~~Additional~~scope ~~Currency~~by ~~on a pro rata basis to Unitholders pursuant to~~ the Trust Agreement. If the IRS were to disagree with, and successfully challenge, any of these positions, the Trust might not qualify as a grantor trust for U.S. federal income tax purposes. If the Trust were treated as owning any asset other than Bitcoins as of any date on which it creates Units, it would likely cease to qualify as a grantor trust for U.S. federal income tax purposes.

~~Because~~Under Delaware law, a Shareholder may bring a derivative action if the Shareholder is a Shareholder at the time the action is brought and either (i) was a Shareholder at the time of the ~~evolving~~transaction ~~nature~~at issue; or (ii) acquired the status of ~~digital~~Shareholder ~~currencies,~~by itoperation isof ~~not~~law ~~possible~~or tothe Trust’s ~~predict~~governing ~~potential~~instrument ~~future~~from ~~developments~~a person who was a Shareholder at the time of the transaction at issue. Additionally, Section 3816(e) of the DSTA specifically provides that “a beneficial owner’s right to bring a derivative action may ~~arise~~be ~~with~~subject ~~respect~~ to such ~~digital~~additional ~~currencies~~standards and restrictions, ~~including~~if ~~forks~~any, ~~airdrops~~as ~~and~~are ~~other~~set ~~similar~~forth ~~occurrences.~~in ~~Assuming~~the ~~that~~governing instrument of the ~~Trust~~statutory istrust, ~~currently~~including, without limitation, the requirement that beneficial owners owning a ~~grantor~~ specified beneficial interest in the statutory trust ~~for~~join Uin the bringing of the derivative action.S.” ~~federal~~The ~~income~~Trust ~~tax~~Agreement ~~purposes,~~provides ~~certain~~that ~~future~~in ~~developments~~addition ~~could~~to ~~render~~any itother ~~impossible~~requirements of applicable law, no Shareholder shall have the right, power or ~~impracticable~~authority to bring or maintain a derivative action, ~~for~~suit or other proceeding on behalf of the Trust unless totwo ~~continue~~or tomore beShareholders ~~treated~~who as(i) aare ~~grantor~~not ~~trust~~affiliates ~~for~~of one another; and (ii) collectively hold at least 10% of the outstanding Shares join in the bringing or maintaining of such ~~purposes~~action, suit or other proceeding.

IfThis ~~the~~provision ~~Trust~~does is not ~~properly~~apply ~~classified~~to asderivative aactions ~~grantor~~brought ~~trust,~~in the ~~Trust~~name ~~might~~of bethe ~~classified~~Trust asunder athe ~~partnership for U.S.~~ federal ~~income tax~~securities ~~purposes.~~laws ~~However,~~and ~~due to~~ the ~~uncertain~~rules ~~treatment~~and ofregulations thereunder. ~~digital~~The ~~currency~~Sponsor ~~for~~is ~~U.S.~~not ~~federal~~aware ~~income~~of ~~tax~~any ~~purposes,~~reason ~~there~~to ~~can~~believe bethat ~~no assurance~~Section ~~in this regard~~7.4 Ifof the Trust ~~were~~Agreement ~~classified~~is asnot aenforceable ~~partnership~~under ~~for~~state or ~~U.S.~~ federal ~~income~~law. ~~tax~~Although ~~purposes,~~ the ~~tax~~Court ~~consequences~~ of ~~owning~~Chancery ~~Units~~of ~~generally~~Delaware ~~would~~has ~~not~~stated bethat ~~materially~~“[t]he ~~different~~DSTA ~~from~~is ~~the~~enabling ~~tax~~in ~~consequences~~nature ~~described herein~~and, ~~although~~as ~~there~~such, ~~might be~~permits ~~certain~~a ~~differences,~~trust ~~including~~through ~~with~~its ~~respect~~declarations ~~to timing~~ of ~~the~~trust ~~recognition~~to ofdelineate ~~taxable~~additional ~~income~~standards orand ~~loss.~~requirements Inwith ~~addition,~~which ~~tax~~a ~~information~~stockholder-plaintiff must ~~reports~~comply ~~provided~~ to ~~beneficial~~proceed ~~owners~~derivatively ~~of Units would be made~~ in athe ~~different~~name ~~form.~~of If the ~~Trust were not classified as either a grantor~~ trust.” orHartsel ~~a partnership for U~~v.S. ~~federal~~Vanguard ~~income tax purposes~~Group., ~~it would be classified as a corporation for such purposes~~Inc. ~~In that event~~, ~~the~~Del. ~~Trust would be subject to entity-level U~~Ch.S. ~~federal~~June ~~income~~15, ~~tax~~2011, ~~(currently at the rate of 21%) on its net taxable~~there ~~income~~is ~~and~~limited ~~certain~~case ~~distributions~~law ~~made~~addressing by the ~~Trust~~enforceability toof ~~Unitholders~~provisions ~~would~~similar ~~be treated as taxable dividends~~ to ~~the~~Section ~~extent of the Trust’s current and accumulated earnings and profits (as calculated for U~~7.S4. ~~federal~~As ~~income tax purposes). Any~~ such, ~~dividend~~it ~~distributed to~~is apossible ~~beneficial owner of Units~~ that isthis aprovision ~~non-U.S. person for U.S. federal income tax purposes~~ would not be ~~subject~~enforced toby ~~U.S. federal withholding tax at~~ a ~~rate~~court ofin ~~30%~~another (jurisdiction or ~~such~~under ~~lower~~other ~~rate as provided in an applicable tax treaty)~~circumstances.

~~The~~Beneficial ~~remainder~~owners ofmay ~~this~~have ~~discussion~~the ~~assumes~~right, subject to certain legal requirements, to bring class actions in federal court to enforce their rights under the ~~Trust~~federal ~~will~~securities laws and the rules and regulations promulgated thereunder by the SEC. Beneficial owners who have suffered losses in connection with the purchase or sale of their beneficial interests may be ~~treated~~able asto recover such losses from the Sponsor where the losses result from a ~~grantor~~violation ~~trust~~by ~~for~~the ~~U.S.~~Sponsor ~~federal~~of ~~income~~the ~~tax~~anti-fraud ~~purposes~~provisions of the federal securities laws.

~~Uncertainty Regarding the~~Actions ~~U.S.~~Taken ~~Federal~~to ~~Income~~Protect ~~Tax~~the ~~Treatment of Digital Currency~~Trust

~~Each~~The ~~beneficial~~Sponsor ~~owner~~may, ofin ~~Units~~its ~~will~~own bediscretion, ~~treated~~prosecute, ~~for~~defend, ~~U.S.~~settle ~~federal~~or ~~income~~compromise ~~tax~~actions ~~purposes~~or asclaims ~~the~~at ~~owner~~law ofor anin ~~undivided~~equity ~~interest~~that init ~~the~~considers ~~Bitcoins~~necessary ~~(and~~or ~~any~~proper ~~Additional~~to ~~Currency)~~protect ~~held in~~ the Trust. ~~Due~~or to the ~~new~~interests ~~and~~of ~~evolving~~the ~~nature~~Shareholders. ofThe ~~digital~~expenses ~~currencies~~incurred ~~and~~by the ~~absence~~Sponsor ofin ~~comprehensive~~connection therewith (including ~~guidance~~the ~~with~~fees ~~respect~~and todisbursements ~~digital~~of ~~currencies,~~legal ~~many~~counsel) ~~significant~~are ~~aspects~~expenses of the ~~U.S.~~Trust ~~federal~~and ~~income~~are ~~tax~~deemed ~~treatment~~to ofbe ~~digital~~Extraordinary ~~currency~~Expenses. The Sponsor is entitled ~~are~~to ~~uncertain~~be reimbursed for the Extraordinary Expenses.

InSuccessor 2014, the IRS released Notice 2014-21, 2014-16 I.R.B. 938 (the “Notice”) discussing certain aspects of the treatment of “convertible virtual currency” (that is, digital currency that has an equivalent value in fiat currency or that acts as a substitute for fiat currency) for U.S. federal income tax purposes. The IRS stated in the Notice that such digital currency (i) is “property” (ii) is “not treated as currency” for purposes of the IRC rules relating to foreign currency gain or loss and (iii) may be held as a capital asset. In 2019, the IRS released Revenue Ruling 2019-24, 2019-44 I.R.B. 1004 (the “Revenue Ruling”) that supplements the Notice, in which the IRS concluded that a hard fork on a digital currency blockchain (i) does not create taxable income if the taxpayer does not subsequently receive new units of digital currency and (ii) creates taxable ordinary income if the taxpayer receives new units of cryptocurrency by airdrop following the hard fork. Simultaneously with the release of the Revenue Ruling, the IRS also published a set of “Frequently Asked Questions” (the “FAQs”), which address, among other issues, how to determine the fair market value of digital currencies and the proper method of determining a holder’s holding period and tax basis for units of digital currency (including those acquired at different times or at varying prices). However, the Notice, Revenue Ruling and FAQs do not address other significant aspects of the U.S. federal income tax treatment of digital currencies, including: (i) whether convertible virtual currencies are properly treated as “commodities” for U.S. federal income tax purposes; (ii) whether convertible virtual currencies are properly treated as “collectibles” for U.S. federal income tax purposes; (iii) the proper method of determining a holder’s holding period and tax basis for convertible virtual currencies acquired at different times or at varying prices; and (iv) whether and how a holder of convertible virtual currencies acquired at different times or at varying prices may designate, for U.S. federal income tax purposes, which of the convertible virtual currencies is transferred in a subsequent sale, exchange or other disposition. The uncertainty surrounding the U.S. federal income tax treatment of digital currencies and other digital assets could affect the performance of the Trust. Moreover, although the Revenue Ruling and FAQs address the treatment of hard forks, there continues to be uncertainty with respect to the timing and amount of the income inclusions.Sponsors

~~There~~If ~~can~~the beSponsor nois ~~assurance~~adjudged ~~that~~bankrupt or insolvent, the ~~IRS~~Sponsor ~~will~~may ~~not~~terminate ~~alter~~and ~~its~~liquidate ~~position~~the ~~with~~Trust ~~respect~~and todistribute ~~digital~~its ~~currencies~~remaining assets in the ~~future~~Sponsor’s orcapacity ~~that~~as aliquidating ~~court would~~trustee.

The Trustee

The Trustee is a fiduciary under the Trust Agreement and must satisfy the requirements of Section 3807 of the DSTA. However, the fiduciary duties, responsibilities and liabilities of the Trustee are limited by, and are only those specifically set forth in, the Trust Agreement.

Limitation on Trustee’s Liability

Under the Trust Agreement, the Sponsor has exclusive control of the management of all aspects of the activities of the Trust and the Trustee has only nominal duties and liabilities to the Trust. The Trustee is appointed to serve as the trustee for the sole purpose of satisfying Section 3807(a) of the DSTA, which requires that the Trust have at least one trustee with a principal place of business in the State of Delaware. The duties of the Trustee are limited to (i) accepting legal process served on the Trust in the State of Delaware; and (ii) the execution of any certificates required to be filed with the Delaware Secretary of State which the Trustee is required to execute under the DSTA.

To ~~uphold~~ the ~~treatment~~extent ~~set~~the ~~forth~~Trustee inhas ~~the~~duties ~~Notice,~~(including ~~Revenue~~fiduciary ~~Ruling~~duties) and ~~FAQs.~~liabilities Itto isthe ~~also~~Trust ~~unclear~~or ~~what~~the ~~additional~~Shareholders ~~guidance~~under on the ~~treatment~~DSTA, such ofduties ~~digital~~and ~~currencies~~liabilities ~~for~~are ~~U.S.~~replaced ~~federal~~by ~~income~~the ~~tax~~duties ~~purposes~~and ~~may~~liabilities beof ~~issued in~~ the ~~future.~~Trustee ~~Any~~expressly ~~such~~set ~~alteration~~forth ofin the ~~current~~Trust ~~IRS~~Agreement. The Trustee ~~positions~~has orno ~~additional~~obligation ~~guidance~~to ~~could~~supervise, ~~result~~nor inwill ~~adverse~~it ~~tax~~be ~~consequences~~liable for, ~~Unitholders~~the ~~and~~acts ~~could~~or ~~have~~omissions anof ~~adverse~~the ~~effect~~Sponsor, onCustodian ~~the prices~~or ofany ~~digital~~other ~~currencies~~person. Neither the Trustee, ~~including~~either ~~the~~in ~~price~~its ofcapacity ~~Bitcoin~~as trustee or in ~~the~~its ~~Bitcoin~~individual ~~markets~~capacity, ~~and~~nor ~~therefore~~any ~~could~~director, ~~have~~officer anor ~~adverse~~controlling ~~effect on~~person of the Trustee ~~value~~is, ofor ~~Units.~~has ~~Future~~any ~~developments~~liability ~~that~~as, ~~may~~the ~~arise~~issuer, ~~with~~director, ~~respect~~officer toor ~~digital~~controlling ~~currencies~~person ~~may~~of ~~increase~~ the ~~uncertainty~~issuer ~~with~~of Shares. The Trustee’s ~~respect~~liability is limited solely to the ~~treatment~~express obligations of ~~digital~~the ~~currencies~~Trustee ~~for~~as ~~U.S.~~set ~~federal~~forth ~~income~~in ~~tax~~the ~~purposes~~Trust Agreement.

~~The~~Under ~~remainder~~the ofTrust ~~this~~Agreement, ~~discussion~~the ~~assumes~~Sponsor ~~that~~has ~~Bitcoin~~the exclusive management, authority and ~~any~~control ~~Additional~~of ~~Currency~~all ~~that~~aspects of the activities of the Trust. ~~may~~The Trustee ~~hold~~has no duty or liability to supervise or monitor the performance of the Sponsor, isnor ~~properly~~does ~~treated~~the Trustee have any liability for Uthe acts or omissions of the Sponsor.S. ~~federal~~The ~~income~~existence ~~tax~~of ~~purposes~~a trustee should not be taken as ~~property~~an indication of any additional level of management or supervision over the Trust. The Trust Agreement provides that ~~may~~the bemanagement ~~held~~authority aswith arespect ~~capital~~to ~~asset~~the ~~and~~Trust is vested directly in the Sponsor. The Trust Agreement provides that the Trustee is not ~~currency~~responsible ~~for~~or ~~purposes~~liable offor the ~~provisions~~genuineness, enforceability, collectability, value, sufficiency, location or existence of ~~the~~any ~~IRC~~of ~~relating~~the toBitcoin ~~foreign~~or ~~currency~~other ~~gain~~assets ~~and~~of ~~loss~~the Trust.

~~Unitholders~~Possible ~~are~~Repayment ~~urged to consult their tax advisers regarding the tax consequences~~ of anDistributions ~~investment~~Received inby ~~the~~Shareholders; ~~Trust~~Indemnification ~~and~~by in digital currencies in general, including, in the case of Unitholders that are generally exempt from U.S. federal income taxation, whether such Unitholders may recognize “unrelated business taxable income” (“UBTI”) within the meaning of IRC Section 512 as a consequence of a fork, airdrop or similar occurrence.Shareholders

~~Uncertainty~~The Shares ~~Regarding~~are limited liability investments. Investors may not lose more than the ~~State~~amount ~~Tax~~that they invest plus any profits recognized on ~~Treatment~~their investment. Although it is unlikely, the Sponsor may, from time to time, make distributions to the Shareholders. However, Shareholders could be required, as a matter of ~~Digital~~bankruptcy ~~Currency~~law, to return to the estate of the Trust any distribution they received at a time when the Trust was in fact insolvent or in violation of its Trust Agreement. In addition, the Trust Agreement provides that Shareholders will indemnify the Trust for any harm suffered by it as a result of Shareholders’ actions unrelated to the activities of the Trust.

~~A number of states have~~The ~~issued~~foregoing ~~their~~repayment ~~own guidance regarding the tax treatment~~ of ~~certain~~distributions ~~digital assets for state income~~ and ~~sales~~indemnity ~~tax~~provisions ~~purposes.~~(other ~~For~~than ~~example, on December 5, 2014,~~ the ~~New~~provision ~~York~~for ~~State~~Shareholders ~~Department~~indemnifying ~~of Taxation and Finance issued guidance regarding~~ the ~~application~~Trust offor ~~New York~~taxes ~~State~~imposed ~~tax~~upon ~~law~~it toby ~~virtual~~a ~~currencies such as Bitcoin. The Department determined that New York State would follow the Notice with respect to the treatment of virtual currencies such as Bitcoin for~~ state ~~income tax purposes. Furthermore~~, ~~the~~local ~~agency~~or ~~took~~foreign ~~the position~~taxing ~~that~~authority, ~~virtual~~which ~~currencies~~is ~~such~~included only as ~~Bitcoin are~~ a ~~form~~formality ofdue ~~“intangible~~to ~~property,” with~~ the ~~result~~fact that ~~the~~many ~~purchase~~states ~~and~~do ~~sale of Bitcoin for fiat currency is~~ not ~~subject~~have tostatutory ~~state~~trust ~~sales~~statutes, ~~tax (although transactions of Bitcoin for other goods~~ and ~~services may~~therefore bethe ~~subject to sales~~ tax ~~under~~status ~~barter transaction treatment). It is unclear if other states will follow the guidance~~ of the ~~New~~ ~~York~~Trust ~~State~~in ~~Department of Taxation and Finance with respect to the treatment of virtual currencies~~ such asstates ~~Bitcoin for income tax and sales tax purposes. If a state adopts a different treatment~~might, ~~such treatment may have negative consequences~~theoretically, ~~including~~be ~~the imposition~~challenged) ~~of a greater tax burden on investors in Bitcoin or the imposition of a greater cost on the acquisition and disposition~~are ofcommonplace ~~Bitcoin generally. Any such treatment may have a negative effect on prices of Bitcoin~~ in ~~the~~statutory ~~digital~~trusts ~~asset exchange market~~ and a ~~negative~~limited ~~impact on the Units~~partnerships.

~~The treatment of virtual~~Indemnification ~~currencies such as Bitcoin for tax purposes by foreign jurisdictions may differ from the treatment~~ of ~~virtual currencies by~~ the ~~IRS~~ or the New York State Department of Taxation and Finance. If a foreign jurisdiction with a significant share of the market of Bitcoin users imposes onerous tax burdens on Bitcoin users or imposes sales or value-added tax on purchases and sales of Bitcoin for fiat currency, such actions could result in decreased demand for Bitcoin in such jurisdiction, which could affect the price of Bitcoin and negatively affect an investment in the Units.Trustee

~~Additional~~The Trustee ~~Currency~~and any of the officers, directors, employees and agents of the Trustee shall be indemnified by the Trust as primary obligor and held harmless against any loss, damage, liability, claim, action, suit, cost, expense, disbursement (including the reasonable fees and expenses of counsel), tax or penalty of any kind and nature whatsoever, arising out of, imposed upon or asserted at any time against such indemnified person in connection with the performance of its obligations under the Trust Agreement, the creation, operation or termination of the Trust or the transactions contemplated therein; provided, however, that neither shall the Trust be required to indemnify any such indemnified person for any such expenses which are a result of the willful misconduct, bad faith or gross negligence of such indemnified person.

~~It is possible that,~~Holding ~~in the future, the Trust will hold Additional Currency that it receives in connection with its investment in Bitcoins. The uncertainties with respect to the treatment~~ of digital currency for U.S. federal income tax purposes, described above, apply to Additional Currency, as well as to Bitcoins. As described above, the Notice addressed only digital currency that is “convertible virtual currency,” defined as digital currency that has an equivalent value in fiat currency or that acts as a substitute for fiat currency. It is conceivable that certain Additional Currency the Trust ~~may receive in the future would not be within the scope of the Notice.~~Property

InThe Trust ~~general,~~holds itand isrecords ~~expected that~~ the ~~Trust~~ownership ~~would~~of ~~receive~~the ~~Additional~~Trust’s ~~Currency~~assets asin a ~~consequence~~manner ofsuch athat ~~fork,~~it anis ~~airdrop~~owned orfor athe ~~similar~~benefit ~~occurrence~~of ~~related~~the ~~to its~~Shareholders ~~ownership~~for ofthe ~~Bitcoins.~~purposes ~~As described above~~of, ~~the~~and ~~Revenue~~subject ~~Ruling~~to and ~~FAQs~~limited ~~include~~by ~~guidance to~~ the ~~effect~~terms ~~that,~~and ~~under~~conditions ~~certain~~set ~~circumstances, forks~~forth ~~(and~~in, ~~presumably,~~the ~~airdrops)~~Trust ofAgreement. ~~digital~~Other ~~currencies~~than ~~are~~issuance ~~taxable~~of the ~~events~~Shares, ~~giving~~the ~~rise~~Trust todoes ~~ordinary~~not ~~income~~create, ~~but~~incur ~~there~~or ~~continues to~~assume beany ~~uncertainty~~indebtedness ~~with~~or ~~respect~~borrow tomoney ~~the~~from ~~timing~~or ~~and~~loan ~~amount~~money ofto ~~the~~any ~~income inclusions~~person. The ~~Trust’s~~Trustee may ~~receipt~~not ofcommingle ~~Additional~~its ~~Currency may~~assets ~~give~~with ~~rise~~those toof any other ~~tax issues~~person. ~~The~~Neither ~~possibility that~~ the Trust, ~~will~~the ~~receive~~Sponsor, ~~Additional~~nor ~~Currency~~any ~~thus~~other ~~increases~~entity ~~the~~is ~~uncertainties and~~permitted ~~risks with respect~~ to ~~the~~lend, pledge, ~~U.S.~~hypothecate ~~federal~~or ~~income~~rehypothecate ~~tax~~any ~~consequences~~ of anthe ~~investment~~Trust’s ~~in Units~~assets.

The Trustee ~~Trust~~ may ~~distribute Additional~~employ ~~Currency~~agents, toattorneys, ~~the Unitholders. Alternatively~~accountants, ~~the~~auditors ~~Trust~~and ~~may~~nominees ~~form a liquidating trust to which it contributes Additional Currency~~ and ~~distributes interests in the liquidating trust to the Unitholders. Any such distribution~~ will not be aanswerable ~~taxable event~~ for ~~a U.S. Holder (as defined below). A U.S. Holder’s tax basis in~~ the ~~Additional~~conduct ~~Currency distributed, whether directly~~ or ~~through~~misconduct ~~the medium~~ of any asuch ~~liquidating trust~~custodians, ~~will be the same as the U.S. Holder’s tax basis in the distributed assets immediately prior to the distribution~~agents, ~~and~~attorneys ~~the~~or ~~U.S.~~nominees ~~Holder’s~~if ~~tax basis in its pro rata share of the Trust’s remaining assets will not include the amount of~~ such ~~basis.~~custodians, ~~Immediately after any such distribution~~agents, ~~the~~attorneys ~~U.S.~~and ~~Holder’s~~nominees ~~holding~~have ~~period~~been ~~with~~selected ~~respect to the distributed Additional Currency will be the same as the U.S. Holder’s holding period~~ with ~~respect to the distributed~~reasonable ~~assets immediately prior to the distribution~~care. ~~A subsequent sale of the distributed Additional Currency will generally be a taxable event for a U.S. Holder.~~

~~For simplicity of presentation~~Resignation, ~~the~~Discharge ~~remainder~~or Removal of ~~this~~Trustee; ~~discussion~~Successor ~~assumes that the Trust will hold only Bitcoins. However, the~~Trustees

The Trustee may resign as Trustee by written notice of its election to do so, delivered to the Sponsor with at least 60 days’ notice. The Sponsor may remove the Trustee in its discretion. If the Trustee resigns or is removed, the Sponsor, acting on behalf of the Shareholders, shall appoint a successor trustee. The successor Trustee will become fully vested with all of the rights, powers, duties and obligations of the outgoing Trustee.

Governing Law

The Trust Agreement and the rights of the Sponsor, Trustee, and Shareholders under the Trust Agreement are governed by the laws of the State of Delaware.

~~principles set forth in the discussion~~Federal ~~below~~Income ~~apply~~Tax to all of the assets that the Trust may hold at any time, including Additional Currency, as well as Bitcoins. Without limiting the generality of the foregoing, each beneficial owner of Units generally will be treated for U.S. federal income tax purposes as owning an undivided interest in any Additional Currency held in the Trust, and any transfers or sales of Additional Currency by the Trust (other than distributions by the Trust, as described in the preceding paragraph) will be taxable events to Unitholders with respect to which Unitholders will generally recognize gain or loss in a manner similar to the recognition of gain or loss on a taxable disposition of Bitcoins, as described below.Considerations

The following is a discussion of certain U.S. federal income tax consequences that generally apply to the purchase, ownership and disposition of Shares for Shareholders. The discussion below is based on the Code, Treasury Regulations promulgated thereunder and judicial and administrative interpretations of the Code, all as in effect on the date of this Annual Report and all of which are subject to change either prospectively or retroactively. The tax treatment of Shareholders may vary depending upon their own particular circumstances. Certain Shareholders (including, but not limited to, banks, financial institutions, insurance companies, regulated investment companies, real estate investment trusts, U.S. Tax-Exempt ~~Consequences~~Shareholders (as defined below) who acquire their Shares with acquisition indebtedness tax-exempt or tax-advantaged retirement plans or accounts, brokers or dealers, traders, partnerships or S corporations for U.S. federal income tax purposes, persons holding Shares as a position in a “hedging,” “straddle,” “conversion,” “constructive sale” or other integrated transaction for U.S. federal income tax purposes, persons whose “functional currency” is not the U.S. dollar, persons required for U.S. federal income tax purposes to accelerate the recognition of any item of gross income with respect to the Shares as a result of such income being recognized on an applicable financial statement, or other investors with special circumstances) may be subject to special rules not discussed below. In addition, the following discussion applies only to investors who hold Shares as “capital assets” (generally, property held for investment). Moreover, the discussion below does not address the effect of any state, local or foreign tax, or any U.S. ~~Holders~~federal non-income tax law consequences that may apply to an investment in Shares, or the Medicare contribution tax imposed on certain net investment income. Purchasers of Shares are urged to consult their own tax advisers with respect to all U.S. federal, state, local and foreign tax law considerations potentially applicable to their investment in Shares.

AsFor purposes ~~used~~of ~~herein~~this discussion, ~~the term~~a “U.S. ~~Holder~~Shareholder” ~~means~~is a ~~beneficial~~Shareholder ~~owner~~that ofis a(or ~~Unit~~is treated as), for U.S. federal income tax purposes ~~that is~~:

● an individual who is a citizen or resident of the United States; ● a corporation created or organized in or under the laws of the United States, any state thereof or the District of Columbia; ● an estate, the income of which is includible in gross income for U.S. federal income tax purposes regardless of its source; or ● a trust, if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more United States persons have the authority to control all substantial decisions of the trust.

●For purposes aof ~~corporation~~this discussion, ora ~~other~~“U.S. ~~entity~~Tax-Exempt ~~treated~~Shareholder” asis a ~~corporation for~~ U.S. ~~federal~~Shareholder ~~income~~that ~~tax~~is ~~purposes,~~exempt ~~created~~from ortax ~~organized in or~~ under ~~the~~Section 501(a) ~~laws~~ of the ~~United States or of any political subdivision thereof; or~~Code.

●For purposes anof ~~estate~~this ~~the~~discussion, ~~income~~a of“Non-U.S. ~~which~~Shareholder” is ~~subject~~a toShareholder that is (or is treated as), for U.S. federal income tax ~~taxation regardless of its source; or~~purposes:

● a ~~trust~~non-resident ifalien ~~(a)~~individual; ● a ~~court~~foreign ~~within~~corporation; ~~the~~or ~~United~~● ~~States~~an isestate ~~able to exercise primary supervision over the administration of the trust and one (1)~~ or ~~more U.S. persons have the authority to control all substantial decisions of the~~ trust, orwhose ~~(b)~~income itis ~~has~~not insubject ~~effect a valid election~~ to ~~be treated as a~~ U.S. ~~person for U.S.~~ federal income tax ~~purposes~~on a net income basis.

~~Except~~If an asentity ~~specifically noted,~~or ~~the~~arrangement ~~discussion~~treated ~~below~~as ~~assumes~~a ~~that~~partnership ~~each~~for U.S. ~~Holder~~federal ~~will~~income ~~acquire~~tax ~~all~~purposes holds Shares, the tax treatment of ~~its~~a ~~Units~~partner ongenerally depends upon the ~~same~~status ~~date~~of ~~for~~the partner and the ~~same~~activities ~~price~~of ~~per~~the partnership. If you are a partner of a partnership holding Shares, the ~~Unit~~discussion ~~and~~below ~~either~~may ~~solely~~not ~~for~~be ~~cash~~applicable orand ~~solely~~we ~~for~~urge ~~Bitcoins~~you ~~that~~to ~~were~~consult ~~originally~~your ~~acquired~~own bytax adviser for the U.S. ~~Holder~~federal ~~for~~income ~~cash~~tax onimplications of the ~~same~~purchase, ~~date~~ownership and disposition of such Shares.

~~As discussed in the~~Taxation ~~section titled “Description~~ of ~~Issuance of Units,” a U.S. Holder may be able to acquire Units of~~ the Trust by contributing Bitcoins in-kind to the Trust. Assuming that the Trust is properly treated as a grantor trust for U.S. federal income tax purposes, such a contribution should not be a taxable event to the U.S. Holder.

~~For~~The Sponsor ~~U.S.~~treats ~~federal~~the ~~income tax~~Trust ~~purposes,~~as ~~each~~a “grantor trust” for U.S. ~~Holder~~federal ~~will~~income betax ~~treated~~purposes. asAlthough ~~owning~~not anfree ~~undivided~~from ~~interest~~doubt, indue to the ~~Bitcoins~~lack ~~held~~of ~~in the Trust and will be treated as~~ directly ~~realizing~~governing ~~its~~authority, ~~pro rata share of~~ the Trust’s ~~income,~~should ~~gains,~~be ~~losses~~classified ~~and~~as ~~deductions. When~~ a ~~U.S.~~“grantor ~~Holder~~trust” ~~purchases Units solely~~ for ~~cash, (i) the~~ U.S. ~~Holder’s~~federal ~~initial~~income tax purposes ~~basis~~(and inthe ~~its~~following ~~pro~~discussion ~~rata~~assumes ~~share~~such ofclassification). ~~the~~If ~~Bitcoins held in~~ the Trust ~~will be~~is ~~equal~~properly totreated ~~the~~as ~~amount~~a ~~paid~~grantor trust for ~~the Units and (ii) the~~ U.S. ~~Holder’s holding period for its pro rata share of such Bitcoins~~federal ~~will~~income ~~begin~~tax onpurposes, the ~~date~~Trust ofitself ~~such~~should ~~purchase.~~not ~~When~~be asubject to U.S. ~~Holder~~federal ~~acquires~~income ~~Units~~tax. ~~in exchange for Bitcoins~~Instead, ~~(i)~~ the ~~U.S. Holder~~Trust’s ~~initial~~ ~~tax~~income ~~basis~~and inexpenses should ~~its~~“flow ~~pro~~through” ~~rata~~to ~~share~~the ofShareholders, and the ~~Bitcoins~~Trustee ~~held~~reports in the Trust’s ~~will~~income, begains, ~~equal~~losses and deductions to the ~~U.S.~~IRS ~~Holder’s~~on ~~tax~~that basis. ~~in the~~It ~~Bitcoins~~is possible that the ~~U.S.~~IRS ~~Holder~~or ~~transferred~~another totax ~~the~~authority ~~Trust~~could ~~and~~assert ~~(ii)~~a ~~the~~position ~~U.S.~~contrary ~~Holder’s~~to ~~holding~~one ~~period~~or ~~for~~all ~~its~~of ~~pro~~those conclusions ~~rata~~and ~~share of~~that ~~such~~a ~~Bitcoins~~court ~~generally~~could ~~will~~sustain ~~include~~that ~~the~~contrary ~~period~~position. ~~during~~Neither ~~which~~the Sponsor nor the ~~U.S.~~Trustee ~~Holder~~intends ~~held~~to ~~the~~request ~~Bitcoins~~a ~~that~~ruling from the ~~U.S.~~IRS ~~Holder~~with ~~transferred~~ respect to the ~~Trust.~~classification ~~The~~of ~~Revenue~~the ~~Ruling~~Trust ~~and~~for ~~FAQs~~U.S. ~~confirm~~federal ~~that~~income iftax apurposes ~~taxpayer~~or ~~acquires~~with ~~tokens~~respect ofto aany ~~digital~~other ~~currency~~matter. atIf the ~~different~~IRS ~~times~~were ~~and for~~to ~~different~~assert ~~prices,~~successfully that the ~~taxpayer~~Trust ~~has~~is anot ~~separate~~classified ~~tax~~as ~~basis~~a in“grantor ~~each~~trust,” ~~lot~~the ofTrust ~~such~~would ~~tokens.~~likely ~~Under~~be ~~the~~classified as ~~Revenue~~either ~~Ruling~~a ~~and~~partnership ~~FAQs,~~for ~~if a~~ U.S. ~~Holder~~federal ~~that~~income ~~owns~~tax ~~more~~purposes, ~~than~~in ~~one~~which ~~lot~~case ofthere ~~Bitcoins~~might ~~contributes~~be adifferent ~~portion~~timing ofor ~~its~~other ~~Bitcoins~~tax consequences to the ~~Trust in exchange for Units~~Shareholders, ~~the U.S.~~or ~~Holder~~as ~~may~~a ~~designate~~publicly ~~the~~traded ~~lot(s)~~partnership ~~from~~that ~~which~~would ~~such contribution will~~ be ~~made,~~taxable ~~provided~~as ~~that~~a ~~the~~corporation for U.S. ~~Holder~~federal isincome ~~able~~tax ~~to identify~~purposes, ~~specifically~~in which ~~Bitcoins~~case itthe isTrust ~~contributing~~would ~~and~~be totaxed ~~substantiate~~in ~~its~~the ~~tax~~same ~~basis~~manner inas ~~those~~a ~~Bitcoins.~~regular Incorporation ~~general,~~on ifits ataxable ~~U.S.~~income ~~Holder acquires~~and ~~Units~~distributions ~~(i)~~to ~~solely~~Shareholders out ~~for~~of ~~cash~~the atearnings ~~different~~and ~~prices,~~profits ~~(ii)~~of ~~partly~~the ~~for~~Trust ~~cash~~generally ~~and~~would ~~partly~~be intaxed ~~exchange~~to ~~for~~Shareholders aas ~~contribution~~ordinary ofdividend ~~Bitcoins or~~income (~~iii)~~which inmay ~~exchange~~be eligible for apreferential ~~contribution~~rates, ofin ~~Bitcoins~~the ~~with~~case ~~different~~of ~~tax~~non-corporate ~~bases~~taxpayers, ~~the~~or ~~U.S.~~a ~~Holder’s~~dividends ~~share~~received ofdeduction, in the ~~Trust’s Bitcoins~~case ~~will consist~~ of ~~separate~~corporate ~~lots~~taxpayers). However, ~~with~~due ~~separate~~to ~~tax~~the ~~bases.~~uncertain Intreatment ~~addition,~~of indigital ~~this~~currency ~~situation,~~for ~~the~~ U.S. ~~Holder’s~~federal ~~holding period~~income ~~for~~tax ~~the~~purposes, ~~separate~~there ~~lots~~can ~~may~~ be ~~different.~~no Inassurance ~~addition,~~in ~~the~~this ~~Additional~~regard. Except ~~Currency~~as ~~that~~otherwise indicated, the ~~Trust~~remainder ~~acquires~~of inthis adiscussion ~~hard~~assumes ~~fork~~that orthe ~~airdrop that~~Trust is ~~treated~~classified as a ~~taxable~~grantor ~~event~~trust ~~will~~for ~~constitute~~U.S. afederal income ~~separate lot with a separate~~ tax ~~basis and holding period~~purposes.

When the Trust transfers Bitcoins to the Sponsor as payment of the Management Fee, or sells Bitcoins to fund payment of any Extraordinary Expenses, each U.S. Holder will be treated as having sold its pro rata share of those Bitcoins for their fair market value at that time (which, in the case of Bitcoins sold by the Trust, generally will be equal to the cash proceeds received by the Trust in respect thereof). As a result, each U.S. Holder will recognize gain or loss in an amount equal to the difference between (i) the fair market value of the U.S. Holder’s pro rata share of the Bitcoins transferred and (ii) the U.S. Holder’s tax basis for its pro rata share of the Bitcoins transferred. Any such gain or loss will be short-term capital gain or loss if the U.S. Holder’s holding period for its pro rata share of the Bitcoins is one year or less and long-term capital gain or loss if the U.S. Holder’s holding period for its pro rata share of the Bitcoins is more than one year. Although unclear due to lack of guidance, a U.S. Holder’s tax basis in its pro rata share of any Bitcoins transferred by the Trust generally will be determined by multiplying the tax basis of the U.S. Holder’s pro rata share of all of the Bitcoins held in the Trust immediately prior to the transfer by a fraction the numerator of which is the amount of Bitcoins transferred and the denominator of which is the total amount of Bitcoins held in the Trust immediately prior to the transfer. Immediately after the transfer, the U.S. Holder’s tax basis in its pro rata share of the Bitcoins remaining in the Trust will be equal to the tax basis of its pro rata share of the Bitcoins held in the Trust immediately prior to the transfer, less the portion of that tax basis allocable to its pro rata share of the Bitcoins transferred.

As noted above, the IRS has taken the position in the Revenue Ruling and FAQs that, under certain circumstances, a hard fork of a

~~digital currency~~Uncertainty ~~constitutes~~Regarding ~~a taxable event giving rise to ordinary income, and it is clear from~~ the ~~reasoning of the Revenue Ruling and FAQs that the IRS generally would treat an airdrop as a taxable event giving rise to ordinary income. Under the Revenue Ruling and FAQs, a~~ U.S. ~~Holder~~Federal ~~will~~Income ~~have~~Tax aTreatment ~~basis in any Additional Currency received in a fork or airdrop equal to the amount~~ of ~~income~~Digital ~~the U.S. Holder recognizes as a result of such fork or airdrop and the U.S. Holder’s holding period for such Additional~~ Currency ~~will begin as of the time it recognizes such income.~~

~~U.S. Holders’~~As ~~pro~~stated ~~rata~~above, ~~shares~~in of2014, the ~~expenses~~IRS ~~incurred~~released by the ~~Trust~~Notice ~~will~~discussing becertain ~~treated~~aspects asof the treatment of “~~miscellaneous~~convertible ~~itemized~~virtual ~~deductions~~currency” (that is, digital currency that has an equivalent value in fiat currency or that acts as a substitute for fiat currency) for U.S. ~~federal~~ federal income tax purposes. AsThe aIRS ~~result,~~stated ~~for~~in ~~taxable~~the ~~years~~Notice ~~beginning~~that ~~before~~such ~~January~~digital 1,currency ~~2026,~~(i) ais ~~non-corporate~~“property” ~~U.S.~~(ii) ~~Holder’s~~is “not treated ~~share~~as currency” for purposes of ~~these~~the ~~expenses~~Code ~~will~~rules ~~not~~relating to foreign currency gain or loss and (iii) may be ~~deductible~~held ~~for~~as Ua capital asset.S. In ~~federal~~2019, ~~income~~the ~~tax~~IRS ~~purposes.~~released ~~For~~the ~~taxable~~Ruling ~~years~~& ~~beginning~~FAQs onthat orprovide ~~after~~some ~~January 1,~~additional ~~2026~~guidance, aincluding ~~non-corporate~~guidance ~~U.S.~~to ~~Holder’s~~the ~~share~~effect that, under certain circumstances, hard forks of ~~these~~digital ~~expenses~~currencies ~~will~~are betaxable ~~deductible~~events ~~for~~giving ~~regular~~rise ~~U.S.~~to ~~federal~~ordinary income ~~tax~~and ~~purposes only~~guidance with respect to the ~~extent~~determination of ~~that~~ the Utax basis of digital currency.S. ~~Holder’s~~However, ~~share~~the ofNotice and the ~~expenses,~~Ruling ~~when~~& ~~combined~~FAQs ~~with~~do ~~other~~not ~~“miscellaneous~~address ~~itemized~~other ~~deductions,” exceeds~~significant 2%aspects of the U.S. federal ~~Holder’s~~income ~~adjusted~~tax ~~gross~~treatment ~~income~~of ~~for~~digital currencies. Moreover, although the ~~particular~~Ruling ~~year~~& FAQs address the treatment of hard forks, ~~will~~there continues ~~not~~to be ~~deductible~~uncertainty ~~for~~with Urespect to the timing and amount of the income inclusions.S. ~~federal~~The ~~alternative~~IRS and Treasury department have also ~~minimum~~released ~~tax~~the ~~purposes~~Regulations. ~~and~~The ~~will~~Regulations beprovide ~~subject~~guidance with respect to ~~certain~~the ~~other~~calculation ~~limitations~~of ongain ~~deductibility~~or loss and the basis of digital assets under Section 1001 and 1012 of the Code.

~~On a sale or other disposition~~The ofExisting ~~Units~~IRS ~~and~~Guidance, ~~although unclear due to lack of guidance~~however, adoes ~~U.S.~~not ~~Holder~~address ~~will~~other besignificant ~~treated~~aspects asof ~~having sold~~ the ~~Bitcoins underlying such Units. Accordingly, the~~ U.S. ~~Holder~~federal ~~generally~~income ~~will~~tax ~~recognize~~treatment ~~gain~~of ordigital ~~loss~~currencies, including: ~~in an amount equal to the difference between~~ (i) ~~the amount~~whether ~~realized~~convertible onvirtual ~~the~~currencies ~~sale~~are ofproperly ~~the~~treated ~~Units~~as ~~and~~“commodities” ~~(ii)~~for ~~the portion of the~~ U.S. ~~Holder’s~~federal ~~tax~~income ~~basis in its pro rata share of the Bitcoins held in the Trust that is attributable to the Units that were sold or otherwise subject to a disposition. Such~~ tax ~~basis~~purposes; ~~generally~~(ii) ~~will~~whether beconvertible ~~determined~~virtual bycurrencies ~~multiplying~~are ~~the~~properly ~~tax~~treated ~~basis~~as of“collectibles” ~~the~~for U.S. ~~Holder’s~~federal ~~pro~~income ~~rata~~tax ~~share of all of the Bitcoins held~~purposes; ~~in the Trust immediately prior to such sale or other disposition by a fraction the numerator of which is the number of Units disposed of~~ and ~~the~~(iii) ~~denominator of which is~~ the ~~total~~proper ~~number~~method of ~~Units~~determining ~~held~~a byholder’s ~~such~~holding ~~U.S.~~period ~~Holder~~for ~~immediately~~convertible ~~prior~~virtual tocurrencies ~~such~~acquired ~~sale~~at ordifferent ~~other disposition~~times ~~(such~~or ~~fraction,~~at ~~expressed~~varying asprices. aThe ~~percentage,~~uncertainty ~~the~~surrounding ~~“Unit Percentage”). If~~ the U.S. ~~Holder’s~~federal ~~share~~income oftax ~~the~~treatment ~~Trust’s Bitcoins consists~~ of ~~separate~~digital ~~lots~~currencies ~~with separate tax bases~~ and~~/or~~ ~~holding~~other ~~periods,~~digital ~~the U.S. Holder should be treated as having~~assets ~~sold~~could affect the ~~Unit~~performance ~~Percentage~~ of ~~each~~the ~~such lot~~Trust. ~~Gain~~Moreover, orthere ~~loss~~continues ~~recognized~~to ~~by a U.S. Holder on a sale or other disposition of Units will generally~~ be ~~short-term~~uncertainty ~~capital~~with ~~gain~~respect orto ~~loss if~~ the ~~U.S.~~timing ~~Holder’s~~and ~~holding~~amount ~~period~~of ~~for~~ the ~~Bitcoins underlying such Units is~~income ~~one~~inclusions ~~year~~from ~~or less and long-term capital gain or loss if~~ the ~~U.S.~~receipt ~~Holder’s holding period for the Bitcoins underlying such Units is more than one year. The deductibility~~ of ~~capital~~digital ~~losses is subject to significant limitations~~assets.

~~After~~There can ~~any~~be ~~sale~~no assurance that the IRS will not alter its position with respect to digital currencies in the future or ~~other~~that a court would uphold ~~disposition~~the oftreatment ~~fewer~~set ~~than~~forth ~~all~~in ofthe aExisting UIRS Guidance.S. ~~Holder’s~~It ~~Units,~~is also unclear what additional guidance on the treatment of digital currencies for U.S. ~~Holder’s~~federal income tax ~~basis~~purposes may be issued in ~~its~~the ~~pro~~future. ~~rata~~Any ~~share~~such alteration of the ~~Bitcoins held~~current inIRS ~~the~~positions ~~Trust~~or ~~immediately~~additional ~~after~~guidance could ~~the~~result ~~disposition~~in ~~will~~adverse ~~equal~~tax ~~the~~consequences ~~tax~~for ~~basis~~Shareholders inand ~~its~~could ~~pro~~have ~~rata~~an ~~share~~adverse ofeffect on the ~~total~~prices ~~amount~~ of ~~the~~digital ~~Bitcoins~~currencies, including ~~held~~the price of Bitcoin in the ~~Trust~~Bitcoin ~~immediately~~markets, ~~prior~~and totherefore ~~the~~could ~~disposition,~~have ~~less~~an adverse effect on the ~~portion~~value of ~~that~~Shares. ~~tax~~Future ~~basis~~developments that may isarise ~~taken~~with ~~into~~respect ~~account~~to indigital ~~determining the~~currencies ~~amount~~may ofincrease ~~gain~~the oruncertainty ~~loss~~with ~~recognized~~respect byto the treatment of digital currencies for U.S. federal ~~Holder~~income ontax ~~the disposition~~purposes.

~~Any brokerage or other~~Taxation ~~transaction fee incurred by a U.S. Holder in purchasing Units generally will be added to the U.S. Holder’s tax basis in the underlying assets~~ of ~~the Trust. Similarly, any brokerage fee or other transaction fee incurred by a~~ U.S. ~~Holder in selling Units generally will reduce the amount realized by the U.S. Holder with respect to the sale.~~Shareholders

InShareholders are ~~the~~treated, ~~absence~~for U.S. federal income tax purposes, as if they directly owned a pro rata share of ~~guidance~~the underlying assets held in the Trust. Except with respect to ~~the~~redemptions ~~contrary~~discussed below, itShareholders isalso ~~possible~~are ~~that~~treated ~~any~~as if they directly received their respective pro rata shares of the Trust’s income, ~~recognized~~if byany, aand Uas if they directly incurred their respective pro rata shares of the Trust’s expenses.S. For ~~tax-exempt~~purposes ~~Unitholder~~of asthis adiscussion, ~~consequence~~and unless stated otherwise, it is assumed that all of a ~~hard~~Shareholder’s ~~fork,~~Shares ~~airdrop~~are acquired on orthe ~~similar~~same ~~occurrence~~date ~~would~~and ~~constitute~~at ~~UBTI~~the same price per Share. AShareholders ~~tax-exempt~~that ~~Unitholder~~hold ~~should~~multiple ~~consult~~lots ~~its~~of ~~tax~~Shares, ~~advisor~~or ~~regarding~~that ~~whether~~are ~~such~~contemplating ~~Unitholder~~acquiring multiple ~~may~~lots ~~recognize~~of ~~some~~Shares, ~~UBTI~~should consult their own tax advisers as ato ~~consequence~~the determination of anthe ~~investment~~tax inbasis ~~Units~~and holding period for the underlying Bitcoin related to such Shares.

~~Tax~~Current IRS ~~Consequences~~guidance on the treatment of convertible virtual currencies classifies Bitcoin as “property” that is not currency for U.S. federal income tax purposes and clarifies that Bitcoin could be held as a capital asset, but it does not address several other aspects of the U.S. federal income tax treatment of Bitcoin. Because Bitcoin is a recent technological innovation, the U.S. federal income tax treatment of Bitcoin or transactions relating to ~~Non-~~investments in Bitcoin may evolve and change from those discussed below, possibly with retroactive effect. In this regard, the IRS indicated that it has made it a priority to issue additional guidance related to the taxation of virtual currency transactions, such as transactions involving Bitcoin. While it has started to issue such additional guidance, whether any future guidance will adversely affect the U.S. ~~Holders~~federal income tax treatment of an investment in Bitcoin or in transactions relating to investments in Bitcoin is unknown. Moreover, future developments that may arise with respect to digital currencies may increase the uncertainty with respect to the treatment of digital currencies for U.S. federal income tax purposes. This discussion assumes that any Bitcoin the Trust may hold is properly treated for U.S. federal income tax purposes as property that may be held as a capital asset and is not currency for purposes of the provisions of the Code relating to foreign currency gain and loss.

As used herein, the term “non-U.S. Holder” means a beneficial owner of a Unit for U.S. federal income tax purposes that is not a U.S. Holder. The term “non-U.S. Holder” does not include (i) a nonresident alien individual who is present in the United States for 183 days or more in a taxable year, (ii) a former U.S. citizen or U.S. resident or an entity that has expatriated from the United States; (iii) a person whose income in respect of Units is effectively connected with the conduct of a trade or business in the United States; or (iv) an entity that is treated as a partnership for U.S. federal income tax purposes. Unitholders described in the preceding sentence should consult their tax advisers regarding the U.S. federal income tax consequences of owning Units.

A non-U.S. Holder generally will not be subject to U.S. federal income or withholding tax with respect to its share of any gain recognized on the Trust’s transfer of Bitcoins in payment of the Management Fee or any additional Trust expenses or on the Trust’s sale or other disposition of Bitcoins, subject to compliance with certification as a non-U.S. Holder. In addition, assuming that the Trust holds no asset other than Bitcoins, a non-U.S. Holder generally will not be subject to U.S. federal income or withholding tax with respect to any gain it recognizes on a sale or other disposition of Units. A non-U.S. Holder also will generally not be subject to U.S. federal income or withholding tax with respect to any distribution received from the Trust, whether in cash or in-kind.

Provided that it does not constitute income that is treated as “effectively connected” with the conduct of a trade or business in the United States, U.S.-source “fixed or determinable annual or periodical” (“FDAP”) income received, or treated as received, by a non-U.S. Holder will generally be subject to U.S. withholding tax at the rate of 30% (subject to possible reduction or elimination pursuant to an applicable tax treaty and to statutory exemptions such as the portfolio interest exemption). Although there is no guidance on point, it is likely

The Trust ~~that~~sells ~~any~~or ~~ordinary~~uses ~~income~~Bitcoin ~~recognized~~to bypay acertain ~~non-U.S.~~expenses ~~Holder~~of asthe aTrust ~~result~~or ofto afund ~~fork~~cash redemptions, ~~airdrop or~~though ~~similar~~the ~~occurrence~~Trust ~~may~~does ~~constitute~~not ~~FDAP~~intend ~~income.~~to Itsell Bitcoin isfor ~~unclear,~~other ~~however,~~purposes. ~~whether~~If ~~any~~the ~~such~~Trust ~~FDAP~~sells ~~income~~Bitcoin ~~would~~(for beexample ~~properly~~to ~~treated as~~generate ~~U.S.-source~~cash to pay fees or ~~foreign-source~~expenses) ~~FDAP~~or ~~income.~~is ~~Non-U.S.~~treated ~~Holders~~as inselling Bitcoin ~~the~~(for ~~Trust~~example ~~should~~by ~~assume~~using ~~that,~~Bitcoin into ~~the~~pay ~~absence~~fees ofor ~~guidance~~expenses), a ~~withholding agent~~Shareholder ~~(including~~generally ~~the~~recognizes ~~Sponsor)~~gain isor ~~likely~~loss toin ~~withhold~~an ~~30%~~amount ~~from~~equal to the difference between (a) ~~non-U.S.~~the ~~Holder~~Shareholder’s pro rata share of ~~any~~the ~~such~~amount ~~income,~~realized ~~including~~ by ~~deducting~~the ~~such~~Trust ~~withheld~~upon ~~amounts~~the ~~from~~sale ~~proceeds~~and (b) the Shareholder’s tax basis for its pro rata share of the Bitcoin that ~~such~~was ~~non-U~~sold.S. ~~Holder~~A ~~would~~Shareholder’s ~~otherwise~~tax bebasis ~~entitled~~for toits ~~receive~~share inof ~~connection with~~any aBitcoin ~~distribution~~sold ofby ~~Additional~~the Trust ~~Currency~~should orgenerally ~~proceeds~~be ~~from~~determined by multiplying the ~~disposition~~Shareholder’s total basis for its share of ~~Additional~~all ~~Currency.~~of Athe ~~non-U.S.~~Bitcoin ~~Holder~~held ~~that~~in isthe Trust immediately prior to the sale, by a ~~resident~~ fraction the numerator of awhich ~~country~~is ~~that~~the ~~maintains~~amount anof ~~income~~Bitcoin ~~tax~~sold, ~~treaty~~and ~~with~~the denominator of which is the ~~United~~total ~~States~~amount ~~may~~of bethe ~~eligible~~Bitcoin toheld ~~claim~~in the ~~benefits~~Trust ofimmediately ~~that treaty~~prior to ~~reduce~~the orsale. ~~eliminate,~~After orany tosuch ~~obtain~~sale, a ~~partial~~Shareholder’s ortax ~~full~~basis for ~~refund~~its pro rata share of, the ~~30%~~Bitcoin ~~U.S.~~remaining ~~withholding~~in the Trust should be equal to its tax onbasis for its share of ~~any~~the ~~such income,~~total ~~but~~amount ~~only~~of ifthe Bitcoin held in the ~~non-U.S.~~Trust ~~Holder’s~~immediately ~~home~~prior ~~country~~to ~~treats~~the sale, less the ~~Trust~~portion asof ~~“fiscally~~such ~~transparent,”~~basis asallocable ~~defined in~~to ~~applicable~~its ~~Treasury~~share ~~regulations~~of the Bitcoin that was sold.

~~Although~~Upon a Shareholder’s sale of some or all of its Shares (other than a redemption), the ~~nature~~Shareholder is treated as having sold the portion or all, respectively, of its pro rata share of the ~~Additional~~Bitcoin ~~Currency~~held ~~that~~in the Trust ~~may~~at ~~hold~~the intime of the ~~future~~sale that is ~~uncertain~~attributable to the Shares sold. Accordingly, itthe isShareholder ~~unlikely~~generally ~~that~~recognizes ~~any~~gain ~~such~~or ~~asset~~loss ~~would~~on ~~give~~the ~~rise~~sale in an amount equal to the difference between (a) the amount realized pursuant to ~~income~~the ~~that~~sale isof ~~treated~~the asShares, ~~“effectively~~and ~~connected”~~(b) ~~with~~the Shareholder’s tax basis for the ~~conduct~~portion of aits ~~trade~~pro orrata ~~business~~share of the Bitcoin held in the ~~United~~Trust ~~States~~at ~~or that~~the ~~any~~time ~~income~~of ~~derived~~sale bythat ais ~~non-U.S.~~attributable ~~Holder~~to ~~from~~the ~~any~~Shares ~~such~~sold, ~~asset~~as ~~would~~determined ~~otherwise~~in bethe ~~subject~~manner todescribed Uin the preceding paragraph.S. ~~income~~Based oron ~~withholding~~current ~~tax~~IRS guidance, ~~except~~ such gain or loss (as ~~discussed~~well ~~above~~as inany ~~connection~~gain ~~with~~or loss realized by a Shareholder on account of the ~~fork,~~Trust ~~airdrop~~selling Bitcoin) is generally a long-term or ~~similar~~short-term ~~occurrence~~capital ~~giving~~gain ~~rise~~or toloss, ~~Additional~~depending ~~Currency.~~upon ~~There~~whether the Shareholder has ~~can,~~a ~~however,~~holding beperiod noof ~~complete~~greater ~~assurance~~than one year in ~~this~~its ~~regard~~pro rata share of the Bitcoin that was sold.

InGains or ~~order~~losses from the sale of Bitcoin to ~~prevent~~ fund cash redemptions are treated as incurred by the ~~possible~~Shareholder ~~imposition~~that is being redeemed, and the amount of ~~U.S.~~such ~~“backup”~~gain ~~withholding~~or ~~and~~loss ~~(if~~generally ~~applicable)~~equals tothe ~~qualify~~difference ~~for~~between (a) ~~reduced~~the ~~rate~~amount realized pursuant to the sale of ~~withholding~~the Bitcoin, and (b) the Shareholder’s tax atbasis ~~source~~for ~~under~~the aportion ~~treaty,~~of aits ~~non-U.S.~~pro ~~Holder~~rata ~~must~~share ~~comply~~of ~~with~~the ~~certain~~Bitcoin ~~certification~~held ~~requirements~~in ~~(generally,~~the byTrust ~~delivering~~that ais sold to fund the ~~properly~~redemption, ~~executed~~as ~~IRS~~determined ~~Form~~in ~~W-8BEN~~the manner described in the paragraph that is two paragraphs above this one. A redemption of some or ~~W-8BEN-E~~all of toa Shareholder’s Shares in exchange for the ~~relevant~~cash ~~withholding~~received ~~agent)~~from such sale is not treated as a separate taxable event to the Shareholder.

UAn in-kind redemption of some or all of a Shareholder’s Shares in exchange for the underlying Bitcoin represented by the Shares redeemed is generally not a taxable event to the Shareholder.S The Shareholder’s tax basis for the Bitcoin received in the in-kind redemption is generally the same as the Shareholder’s tax basis for the portion of its pro rata share of the Bitcoin held in the Trust immediately prior to the in-kind redemption that is attributable to the Shares redeemed. ~~Information~~The ~~Reporting~~Shareholder’s ~~and~~holding ~~Backup~~period with respect to the ~~Withholding~~Bitcoin received generally should include the period during which the Shareholder held the Shares redeemed in kind. A subsequent sale of the Bitcoin received by the Shareholder is generally a taxable event, unless a nonrecognition provision of the Code or Treasury Regulations applies to such sale.

~~The~~After any sale or redemption of less than all of a Shareholder’s Shares, the Shareholder’s tax basis for its pro rata share of the Bitcoin held in the Trust immediately after such sale or redemption is generally equal to its tax basis for its share of the ~~appropriate~~total ~~broker~~amount ~~will~~of ~~file~~the ~~certain~~Bitcoin ~~information~~held ~~returns~~in ~~with~~the Trust immediately prior to the ~~IRS~~sale ~~and~~or ~~provide~~redemption, ~~Unitholders~~less ~~with~~the ~~information~~portion ~~regarding~~of ~~their~~such ~~annual~~basis ~~income~~which is taken into ~~(if~~account ~~any)~~in ~~and~~determining ~~expenses~~the ~~with~~amount ~~respect~~of togain or loss recognized by the ~~Trust~~Shareholder upon such sale or redemption for money or, in ~~accordance~~the ~~with~~case of ~~applicable~~an ~~Treasury~~in-kind ~~regulations~~redemption, that is treated as the basis of the Bitcoin received by the Shareholder in the redemption.

AIf a ~~U.S.~~hard ~~Holder~~fork ~~will~~occurs ~~generally be~~in ~~subject~~the toBitcoin ~~information~~blockchain, ~~reporting~~the ~~requirements~~Trust could temporarily hold both the original Bitcoin and ~~backup~~the ~~withholding~~alternative ~~unless~~new ~~(i)~~asset as the ~~U.S.~~Sponsor ~~Holder~~determines, in its sole discretion, which asset it believes is agenerally ~~corporation~~accepted oras Bitcoin. The other ~~exempt~~asset will be ~~recipient~~treated as an Incidental Right and/or ~~(ii)~~IR Virtual Currency, in accordance with the ~~case~~procedures specified herein. The IRS has held that a hard fork resulting in the creation of ~~backup~~new ~~withholding~~units of cryptocurrency is a taxable event giving rise to ordinary income. The receipt, distribution and/or sale of the new alternative asset may cause Shareholders to incur a U.S. ~~Holder~~federal ~~provides~~income atax ~~correct~~liability. ~~taxpayer~~While ~~identification~~the IRS ~~number~~has ~~and~~not ~~certifies that~~addressed all situations in which airdrops occur, it is ~~not~~clear ~~subject~~from the reasoning of the IRS’s current guidance that it generally would treat an airdrop as a taxable event giving rise to ~~backup~~ordinary ~~withholding.~~income, Inand ~~order~~it is anticipated that any gain or loss from disposition of any assets received in the airdrop would generally be treated as giving rise to ~~avoid~~capital gain or loss that generally would be short-term capital gain or loss, unless the ~~information~~holding ~~reporting~~period of those assets were treated as being greater than one year as of the time they are sold. If in consultation with legal advisors and ~~backup~~tax ~~withholding~~consultants, ~~requirements~~the Trust determines that the IR Virtual Currency is, or is likely to be deemed, a ~~non-U.S.~~security ~~Holder~~under ~~may~~federal ~~have~~or tostate ~~comply~~securities ~~with~~laws ~~certification~~or ~~procedures~~cause the Trust to ~~establish~~lose ~~that~~its itstatus isas ~~not~~an investment trust classified as a ~~U.S.~~grantor ~~person.~~trust ~~The~~for ~~amount~~federal ofincome tax purposes, the Sponsor will cause the Trust to permanently and irrevocably abandon any Incidental ~~backup~~Rights ~~withholding~~and ~~will~~IR beVirtual ~~allowed~~Currency asto awhich ~~credit~~the ~~against~~Trust may become entitled in the ~~Unitholder’s~~future. However, there can be no assurance that these abandonments would be treated as effective for U.S. federal income tax ~~liability~~purposes, ~~and~~or ~~may~~that ~~entitle~~ the ~~holder~~Sponsor will continue to acause ~~refund,~~the ~~provided~~Trust to permanently and irrevocably abandon any Incidental Rights and IR Virtual Currency if there are future regulatory developments that ~~the~~would ~~required~~make ~~information~~it feasible isfor ~~furnished~~the Trust to ~~the~~retain ~~IRS~~those assets.

FATCA

As discussed above, it is unclear whether any ordinary income recognized by a non-U.S. Holder as a result of a fork, airdrop or similar occurrence would constitute U.S.-source FDAP income. Pursuant to IRC Sections 1471-1474 (commonly referred to as “FATCA”), accompanying Treasury regulations, and other guidance from the U.S. Department of Treasury and IRS, the United States imposes a withholding tax of 30% on “withholdable payments” (generally, U.S.-source FDAP income) to “foreign financial institutions” (which is broadly defined to generally include investment vehicles) and certain non-U.S. entities unless various U.S. information reporting and due diligence requirements (generally relating to ownership by U.S. persons of interests in or accounts with those entities) have been satisfied, or an exception otherwise applies. An intergovernmental agreement between the United States and an applicable foreign country may modify these requirements. While such withholding would have applied also to payments of gross proceeds from the sale or other disposition on or after January 1, 2019, of property of a type which can produce US-source dividends and interest, recently proposed Treasury Regulations eliminate such withholding on payments of gross proceeds entirely. Taxpayers generally may rely on these proposed Treasury Regulations until final Treasury Regulations are issued.

If FATCA withholding is imposed, a beneficial owner that is not a foreign financial institution generally may obtain a refund of any amounts withheld by filing a U.S. federal income tax return (which may entail significant administrative burden).

Since the enactment of FATCA, other jurisdictions have instituted similar regimes. The Trust may incur taxes or may be required to withhold tax pursuant to such regimes. Unitholders should consult their tax advisors regarding the effects of FACTA and similar information reporting regimes on an investment in the Trust.

ERISA and Related Considerations

General

The following section sets forth certain consequences under the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) and the IRC which a fiduciary of an “employee benefit plan” as defined in and subject to the fiduciary responsibility provisions of ERISA, or of a “plan” as defined in and subject to Section 4975 of the IRC, who has investment discretion should consider before

~~deciding to acquire Units with plan assets (such “employee benefit plans” and “plans”~~Brokerage ~~being~~Fees ~~referred to herein as “Plans,”~~ and ~~such~~Trust fiduciaries with investment discretion being referred to herein as “Plan Fiduciaries”). The following summary is not intended to be complete, but only to address certain questions under ERISA and the IRC that are likely to be raised by the Plan Fiduciary’s own counsel.Expenses

~~In general,~~Any ~~the~~brokerage, ~~terms~~financing ~~“employee~~or ~~benefit~~other ~~plan”~~transaction asfee ~~defined~~incurred inby ~~ERISA~~a ~~and~~Shareholder ~~“plan”~~in aspurchasing ~~defined~~Shares inis ~~Section~~treated ~~4975~~as part of the ~~IRC~~Shareholder’s ~~together~~tax ~~refer~~basis toin ~~any~~the ~~plan~~underlying orassets ~~account~~ of ~~various~~the ~~types~~Trust. ~~which~~Similarly, ~~provides~~any ~~retirement~~brokerage ~~benefits~~fee orincurred ~~welfare~~by ~~benefits~~a toShareholder anin ~~individual~~selling Shares reduces the oramount torealized anby ~~employer’s~~the ~~employees~~Shareholder ~~and~~with ~~their~~respect ~~beneficiaries~~to the sale. ~~Such~~It ~~plans~~is ~~and~~also ~~accounts~~possible ~~include~~that, ~~but~~based ~~are~~on ~~not~~the ~~limited~~mechanics ~~to,~~associated ~~corporate~~with redemptions, ~~pension~~a ~~and~~Shareholder ~~profit~~may ~~sharing~~recognize ~~plans,~~some ~~“simplified~~amount ~~employee~~of ~~pension~~income, ~~plans~~expense,” ~~Keogh~~gain ~~plans~~or ~~for~~loss ~~self-employed~~in ~~individuals~~connection ~~(including partners)~~with redemptions of other Shareholders, ~~individual~~based on ~~retirement~~differences ~~accounts~~between ~~described~~the inprices ~~Section~~at ~~408~~which orShares ~~408A~~generally ofare redeemed and the ~~IRC~~actual ~~and~~prices ~~medical~~at ~~benefit~~which ~~plans~~the Trust sells Bitcoin.

~~Each Plan~~Shareholders ~~Fiduciary must give appropriate consideration to the facts and circumstances that~~ are ~~relevant~~required to anrecognize ~~investment in~~ the ~~Trust,~~full ~~including the~~amount ~~role~~of angain ~~investment~~or inloss ~~the~~upon ~~Trust~~a ~~plays~~sale inor ~~the~~deemed ~~Plan’s~~sale ~~investment~~of ~~portfolio.~~Bitcoin Toby the ~~extent~~Trust ~~required~~(as bydiscussed ~~applicable law~~above), ~~each~~even ~~Plan~~though ~~Fiduciary~~some ~~must~~or beall ~~satisfied~~of ~~that investment in~~ the ~~Trust~~proceeds isof asuch ~~prudent~~sale ~~investment~~are ~~for~~used ~~the~~by ~~Plan, that~~ the ~~investments~~Sponsor ofto ~~the Plan,~~pay ~~including the investment in the~~ Trust, ~~are~~expenses. ~~diversified~~Shareholders somay asdeduct totheir ~~minimize~~respective pro ~~the~~rata ~~risks~~shares of ~~large~~each ~~losses,~~expense ~~that~~incurred anby ~~investment in~~ the Trust ~~complies~~to ~~with~~ the ~~documents~~same ~~and~~extent ~~instruments~~as ofif ~~the~~they ~~Plan~~directly ~~and~~incurred ~~related~~the ~~trust~~expense. ~~and~~Shareholders ~~that~~who anare individuals, ~~investment~~estates inor ~~the~~trusts, ~~Trust~~however, ~~does~~may ~~not give~~be ~~rise~~required to atreat ~~transaction~~some ~~prohibited~~or byall ~~Section~~of ~~406~~the expenses of ~~ERISA~~the orTrust ~~Section~~as ~~4975~~miscellaneous ofitemized deductions. ~~the~~An ~~IRC~~individual ~~for~~may ~~which~~not nodeduct ~~exemption~~miscellaneous isitemized ~~available~~deductions.

~~EACH PLAN FIDUCIARY CONSIDERING ACQUIRING~~Investment ~~UNITS~~by ~~SHOULD~~U.S. ~~CONSULT~~Tax-Exempt ~~ITS OWN LEGAL AND TAX ADVISERS BEFORE DOING SO.~~Shareholders

~~Restrictions~~Individual retirement onaccounts ~~Investments~~(“IRAs”) byand ~~Benefit~~participant-directed ~~Plan~~accounts ~~Investors~~under tax-qualified retirement plans are limited in the types of investments they may make under the Code. Potential purchasers of Shares that are IRAs or participant-directed accounts under a Code Section 401(a) plan should consult with their own tax advisors as to the ability to purchase Shares and the tax consequences of a purchase of Shares.

~~ERISA and a regulation~~Taxation ~~issued thereunder contain rules for determining when an investment by a Plan in an entity will result in the underlying assets~~ of ~~the entity being deemed assets of the Plan for purposes of ERISA and Section 4975 of the IRC (i~~U.eS., ~~“plan~~Tax-Exempt assets”). Those rules provide that assets of an entity will not be plan assets of a Plan that purchases an interest therein if the investment in the entity by all “benefit plan investors” is not “significant” or certain other exceptions apply. The term “benefit plan investors” includes all Plans (i.e., all “employee benefit plans” as defined in and subject to the fiduciary responsibility provisions of ERISA and all “plans” as defined in and subject to Section 4975 of the IRC) and all entities that hold “plan assets” (each, a “Plan Assets Entity”) due to investments made in such entities by already described benefit plan investors. ERISA provides that a Plan Assets Entity is considered to hold plan assets only to the extent of the percentage of the Plan Assets Entity’s equity interests held by benefit plan investors. In addition, all or part of an investment made by an insurance company using assets from its general account may be treated as a benefit plan investor. Investments by benefit plan investors will be deemed not significant if benefit plan investors own, in the aggregate, less than 25% of the total value of each class of equity interests of the entity (determined by not including the investments of persons with discretionary authority or control over the assets of such entity, of any person who provides investment advice for a fee (direct or indirect) with respect to such assets, and “affiliates” (as defined in the regulations issued under ERISA) of such persons; provided, however, that under no circumstances are investments by benefit plan investors excluded from such calculation).Shareholders

~~In order to avoid causing~~Income ~~assets~~recognized ofby ~~the~~U.S. ~~Trust~~Tax-Exempt toShareholders beis ~~“plan~~generally ~~assets,”~~exempt ~~the~~from ~~Sponsor~~U.S. ~~intends~~federal toincome ~~restrict~~tax ~~the~~except ~~aggregate investment by “benefit plan investors”~~ to ~~under 25% of~~ the ~~total~~extent ~~value~~ of ~~the~~such ~~Units~~Shareholders’ UBTI. ofUBTI ~~the~~is ~~Trust~~defined ~~(not~~generally ~~including~~as ~~the~~income ~~investments~~from ofa ~~the~~trade ~~Trustee, the~~or ~~Sponsor,~~business ~~any~~regularly ~~other~~carried ~~person~~on ~~who~~by ~~provides investment advice for~~ a ~~fee~~tax-exempt ~~(direct~~entity orthat ~~indirect)~~is ~~with~~unrelated ~~respect~~ to the entity’s ~~assets~~exempt ofpurpose. ~~the Trust~~Dividends, ~~any~~ ~~other~~interest ~~person~~and, ~~who~~with ~~has~~certain ~~discretionary~~exceptions, ~~authority~~gains or ~~control~~losses ~~over~~from the ~~assets of the Trust~~sale, ~~and~~exchange ~~any~~or ~~entity (~~other ~~than a benefit~~disposition ~~plan~~of ~~investor)~~property ~~that~~are isgenerally ~~directly~~excluded orfrom ~~indirectly~~UBTI ~~through~~(so ~~one~~long oras ~~more~~not ~~intermediaries~~derived ~~controlling,~~from ~~controlled~~debt-financed byproperty). orWhen ~~under~~a ~~common~~U.S. ~~control~~Tax-Exempt Shareholder ~~with~~owns ~~any~~an ofinterest ~~such~~in ~~entities (including~~ a ~~partnership~~grantor ortrust, ~~other~~such ~~entity~~as ~~for which~~ the ~~Sponsor~~Trust, is the ~~general~~activities ~~partner, managing member, investment adviser or provides investment advice), and each~~ of the ~~principals,~~Trust ~~officers,~~ (and ~~employees of~~ any ofpass-through ~~the foregoing~~ entities ~~who has the power to exercise a controlling influence over the management~~ or ~~policies~~disregarded ofentities in ~~such~~which ~~entity or~~ the Trust). ~~Furthermore, because~~owns ~~the~~an ~~25%~~interest) ~~test~~are isattributed ~~ongoing, it not only restricts additional investments by benefit plan investors, but also can cause the Sponsor~~ to ~~require that existing benefit plan investors redeem from~~ the ~~Trust~~U.S. inTax-Exempt ~~the~~Shareholder ~~event~~for ~~that~~purposes ~~other investors redeem their Units. If rejection~~ of ~~subscriptions~~determining orwhether such ~~compulsory redemptions are necessary, as determined by the Sponsor, to avoid causing the~~Shareholder’s ~~assets~~share of ~~the~~income ~~Trust~~is toof ~~be “plan assets,”~~ the ~~Sponsor~~grantor ~~will~~trust ~~effect such rejections or redemptions in such manner as the Sponsor, in its sole discretion, determines~~UBTI.

~~However, there is no~~The ~~assurance~~Trust’s ~~that~~investments ~~the~~and ~~Sponsor~~activities ~~will~~relating ~~succeed~~thereto inmay ~~avoiding~~cause ~~the~~a ~~assets~~U.S. ofTax-Exempt ~~the~~Shareholder ~~Trust~~to ~~being~~realize ~~treated as “plan assets~~UBTI.” IfIn the ~~assets~~ ofabsence ~~the Trust were to constitute “plan assets” for purposes~~ of any ~~ERISA~~guidance ~~and/or~~on ~~Section 4975 of~~ the ~~IRC~~matter, ~~the~~a ~~fiduciary responsibility~~U.S. ~~rules~~Tax-Exempt ofShareholder’s ~~ERISA~~share ~~and the prohibited transaction rules~~ of ~~ERISA~~income ~~and~~from ~~Section~~a ~~4975 of the IRC~~fork, ~~as applicable~~airdrop, ~~could~~or ~~potentially limit~~similar ~~the~~event ~~investments~~may ~~and operations of the Trust, which could result in a lower return than might otherwise~~ be ~~the~~treated as ~~case~~UBTI. InIf ~~addition, if~~the ~~ERISA~~Trust were to ~~apply~~incur liabilities, ~~the~~and ~~fiduciary~~thus, ~~who~~be ~~made~~treated ~~the~~as ~~decision~~holding toproperty ~~invest~~constituting andebt-financed ~~ERISA~~property ~~Plan’s or Plan Asset Entity’s assets~~(generally, inassets ~~the~~purchased ~~Trust~~with ~~could,~~borrowed ~~under certain circumstances~~funds), beincome ~~liable~~attributable ~~under~~to ~~ERISA~~such ~~as a~~property ~~co-fiduciary~~generally ~~for~~would ~~actions~~constitute ~~taken by the Trustee or Sponsor on behalf of the Trust~~UBTI.

~~Ineligible~~UBTI generally ~~Purchasers~~is separately calculated for each trade or business of a U.S. Tax-Exempt Shareholder. Thus, a U.S. Tax Exempt Shareholder generally cannot use deductions relating to one trade or business to offset income from another trade or business.

InA U.S. ~~general,~~private ~~Units~~foundation ~~may not~~considering an investment should be ~~purchased~~aware ~~with~~that, ~~the~~if ~~assets~~such ofa foundation acquires a ~~Plan~~sufficiently iflarge ~~the~~number ~~Trustee~~of Shares, such Shares could become an “excess business holding” that could subject the ~~Sponsor,~~foundation ~~any~~to ofa ~~their~~U.S. ~~respective~~excise ~~affiliates~~tax. orA ~~any~~private foundation should consult its tax advisors regarding the excess business holdings provisions of ~~their~~the ~~respective~~Code and other respects in which ~~employees~~the ~~either:~~provisions ~~(i)~~of ~~has~~Chapter ~~investment~~42 ~~discretion~~of ~~with~~the ~~respect~~Code tocould affect the ~~investment~~consequences ofto such ~~Plan~~foundation ~~assets;~~of ~~(ii)~~acquiring ~~has~~and ~~authority~~holding orShares.

Prospective investors who are U.S. Tax Exempt Shareholders should consult their tax advisors with respect to the U.S. federal income tax consequences of an investment in Shares.

Taxation of Non-U.S. Shareholders

The Trust does not expect (though no assurance can be given) to be treated as engaged in a trade or business within the United States or recognize income that is treated as “effectively connected” with the conduct of a trade or business in the United States (“ECI”). However, while it is unlikely that any income that the Trust might recognize as a result of a fork, airdrop or similar event would give rise to effectively connected income, there has been no guidance as to how such events may be treated. Therefore, there can be no assurance that the Trust will not be treated as engaged in a U.S. trade or business or will not otherwise generate income treated as effectively connected with a U.S. trade or business for U.S. federal income tax purposes.

Provided that the Trust is not engaged in the conduct of a U.S. trade or business, and that it does not otherwise generate income treated as effectively connected with a U.S. trade or business, the U.S. federal income tax liability of a Non-U.S. Shareholder with respect to that Shareholder’s Shares are generally limited to withholding tax on certain gross income from U.S. sources (if any) generated by the Trust.

~~responsibility~~A toNon-U.S. ~~give~~Shareholder’s orallocable ~~regularly~~share ~~gives~~of ~~investment~~U.S. ~~advice~~source ~~with respect to such Plan assets~~dividend, ~~for a fee~~interest, rental and ~~pursuant~~other to“fixed anor ~~agreement~~determinable annual or ~~understanding that~~periodical ~~such~~gains, ~~advice~~profits ~~will~~and ~~serve~~income” as(“FDAP”) athat ~~primary~~is ~~basis~~not ~~for~~ECI ~~investment~~is ~~decisions~~generally ~~with~~subject ~~respect~~ to ~~such~~U.S. ~~Plan~~federal ~~assets and that such advice will~~withholding betax ~~based~~at ona ~~the~~rate ~~particular investment needs~~ of ~~the~~30% ~~Plan; or~~ (~~iii)~~unless isreduced ~~an employer maintaining~~ or ~~contributing~~eliminated toby ~~such~~an ~~Plan.~~applicable Aincome ~~party that~~tax istreaty ~~described~~or instatutory ~~clause (i~~exemption). orThere ~~(ii) of the preceding sentence~~ is acurrently ~~fiduciary~~no guidance ~~under~~as ~~ERISA~~to ~~and~~whether ~~the~~income ~~IRC~~recognized ~~with~~by ~~respect to~~ the ~~Plan, and~~Trust ~~any~~as ~~such~~a ~~purchase might~~ result inof a ~~“prohibited transaction” under ERISA and the IRC~~fork, ~~resulting~~airdrop inor ~~possible~~similar ~~liabilities and~~event ~~penalties~~would ~~for~~constitute ~~the responsible Plan fiduciaries and the parties engaging in the transaction with the Plan in the absence of an available exemption~~U.S. Asource non-exempt prohibited transaction involving an individual retirement account (“IRA”) and the individual who established the IRA, or his or her beneficiaries, could result in loss of the IRA’s tax-exempt status and assessment of taxes and penaltiesFDAP.

~~Reporting~~A Non-U.S. ~~Requirements~~Shareholder resident in a jurisdiction with which the U.S. has an income tax treaty may be entitled to the benefits of that treaty in order to reduce or eliminate the 30% U.S. withholding tax with respect to that Shareholder’s distributive share of income that the Trust treats as U.S.-source FDAP if under the laws of that non-U.S. jurisdiction, the Trust is treated as tax-transparent and certain other conditions are met. In order to secure the benefits of an applicable income tax treaty through a reduction or elimination of withholding, Non-U.S. Shareholders are generally required to certify their non-U.S. status by providing the Trust with an executed IRS Form W-8BEN or W-8BEN-E. However, if a Non-U.S. Shareholder fails to provide such IRS Forms, the Trust intends to withhold at a full 30% rate on any Non-U.S. Shareholder’s share of U.S.-source FDAP, in which case the Non-U.S. Shareholder must file a refund claim with the IRS in order to obtain the benefit of a reduced rate or exemption.

~~Plans are required to~~If ~~determine~~ the ~~fair~~proper ~~market~~amounts ~~value~~are ofwithheld ~~their~~and ~~assets~~remitted asto of the ~~close~~U.S. ofgovernment ~~each~~and ~~Plan’s~~the ~~fiscal~~Trust ~~year.~~does ~~ERISA~~not ~~Plans~~recognize ~~and~~ECI, ~~IRAs~~Non-U.S. ~~are~~Shareholders ~~also~~that ~~required~~are toindividuals ~~file~~or ~~annual~~corporations ~~reports~~are ~~(Form~~generally ~~5500~~not ~~series~~required ~~and~~to ~~Form~~file ~~5498) with the~~ U.S. ~~Department~~federal ofincome ~~Labor~~tax returns or ~~the~~pay ~~IRS~~additional U.S. Tofederal ~~facilitate fair~~income ~~market~~taxes ~~value~~solely ~~determinations,~~as ~~and~~a toresult ~~enable fiduciaries~~ of ~~Plans to satisfy~~ their ~~annual~~investments ~~reporting requirements as they relate to an investment~~ in the Trust, ~~Unitholders~~(though ~~will~~Non-U.S. beShareholders ~~furnished~~treated ~~annually with audited financial statements~~ as ~~described~~trusts infor ~~this Annual Report~~U.S. ~~There~~federal ~~can~~income ~~be no assurance (i) that any value established on the basis of such statements could or will actually be realized~~purposes byare ~~investors~~subject ~~upon the liquidation of Units, (ii) that investors could realize such value if they were able~~ to, ~~and~~special ~~were to sell their Units, or (iii~~rules) ~~that such value will in all circumstances satisfy the applicable ERISA or IRC reporting requirements~~.

~~In addition, the fiduciaries~~If ~~of an ERISA Plan investing in~~ the Trust ~~are~~is ~~notified~~treated ~~that~~as ~~the~~a ~~information~~partnership in(for ~~this~~U.S. ~~Annual~~federal ~~Report~~income intax ~~relation to (i~~purposes), ~~the~~a ~~compensation or~~Non-U.S. ~~other~~Shareholder ~~amounts~~is ~~received~~treated byas ~~the~~disposing ~~Trustee,~~of ~~the Sponsor~~Shares, and ~~other~~any ~~parties~~portion inof ~~connection~~the ~~with~~gain ~~their~~realized ~~services~~on ~~rendered to~~ the ~~Trust or~~disposition ~~their~~would ~~position~~be ~~with~~treated ~~the~~as ~~Trust;~~ECI, ~~(ii)~~such ~~the~~Shares ~~services~~may ~~provided~~be bysubject ~~them~~ to ~~the~~a ~~Trust~~withholding ~~for~~tax ~~such compensation or in connection with such~~equal ~~other~~to ~~amounts~~10% ~~received,~~of ~~and~~ the ~~purpose~~amount ~~therefor;~~realized ~~(iii)~~on ~~a description of~~ the ~~formula~~disposition or(subject ~~other bases used~~ to ~~calculate~~reduction ~~the compensation~~ or ~~other~~elimination ~~amounts~~in ~~received;~~certain ~~and (iv~~circumstances). ~~the~~Non-U.S. ~~identity~~Shareholders are ofurged ~~the parties paying and receiving the compensation or other amounts is intended~~ to ~~satisfy~~consult ~~the alternative reporting option~~ with ~~respect~~their totax ~~payments~~advisers toregarding ~~such~~the ~~parties~~application ~~that are reportable on Schedule C~~ of ~~the~~this ~~Plan’s Form~~withholding ~~5500~~tax.

If the Trust is treated as having any ECI (or any portion of the gain realized on a Non-~~ERISA~~U.S. ~~Plans~~Shareholder’s disposition of Shares is treated as ECI), then if such Non-U.S. Shareholder is treated as a corporation, it may also be subject to U.S. federal branch profits tax on its effectively connected earnings and profits (which, with respect to the Shares, would generally be such Non-U.S. Shareholder’s share of ECI from such Shares, reduced by deductions taken into account by the Shareholder in computing its ECI, and further reduced by the U.S. federal income taxes imposed on such ECI). U.S. federal branch profits tax is generally imposed at a 30% rate, though it may be reduced under the Code or pursuant to an applicable income tax treaty.

~~Governmental plans,~~United ~~certain~~States ~~church~~Information ~~plans~~Reporting ~~(those that have not elected to become subject to ERISA),~~ and ~~non-U.S.~~Backup plans, while not subject to the fiduciary responsibility provisions of ERISA or the prohibited transaction rules of Section 4975 of the IRC, may nevertheless be subject to state, local, or other federal laws, or foreign laws, that are substantially similar to some or all of the foregoing provisions of ERISA and the IRC. Thus, while the above-described prohibited transaction provisions of ERISA and the IRC may not apply to such plans, those responsible for the investment of the assets of such plans should consider other potentially applicable similar restrictions under other laws. Such potential restrictions may include prohibitions against certain related-party transactions under Section 503 of the IRC, applicable state, local, federal, or non-U.S. laws, and the restrictions and duties of common law.Withholding

~~Except~~The Trustee asfiles ~~otherwise set~~certain ~~forth~~information returns with the IRS, and provides certain tax-related information to Shareholders, in connection with the ~~foregoing~~Trust. ~~statements~~To the extent required by applicable regulations, each Shareholder is provided with information regarding its allocable portion of the ~~consequences~~Trust’s ~~under~~annual ~~ERISA~~income, expenses, gains and ~~the~~losses ~~IRC~~(if ofany). anU.S. ~~investment~~Shareholders ingenerally ~~the~~may ~~Trust~~comply ~~are~~with ~~based~~these identification onprocedures by providing the ~~provisions~~Trust ofwith ~~the~~a ~~IRC~~duly completed and ~~ERISA~~executed asIRS ~~currently~~Form inW-9 ~~effect,~~(Request for Taxpayer Identification Number and Certification). Non-U.S. Shareholders generally may comply with these identification procedures by providing the ~~existing~~Trust ~~administrative~~with ~~and~~the ~~judicial~~relevant ~~interpretations~~IRS ~~thereunder.~~Form W-8, Noduly ~~assurance~~completed ~~can~~and executed. Shareholders may be ~~given~~required ~~that~~to ~~administrative,~~satisfy ~~judicial~~certain information reporting or ~~legislative~~certification ~~changes~~requirements, ~~will~~e.g., those ~~not~~imposed ~~occur~~by ~~that~~the ~~may~~“Foreign ~~make~~Account ~~the~~Tax ~~foregoing~~Compliance ~~statements incorrect~~Act” or ~~incomplete~~“FATCA,” to avoid certain information reporting and withholding tax requirements.

~~Employees~~The amount of any backup withholding is allowed as a credit against a Shareholder’s U.S. federal income tax liability and may entitle the Shareholder to a refund, provided that the required information is furnished to the IRS in a timely manner.

~~The Trust has no employees.~~FATCA

~~Item~~As discussed 1Aabove, it is unclear whether any ordinary income recognized by a non-U.S. ~~Risk~~Holder ~~Factors~~as a result of a fork, airdrop or similar occurrence or staking would constitute U.S.-source FDAP income. Provisions of the Code commonly referred to as “FATCA” require withholding of 30% on payments of U.S.-source FDAP income and, subject to the discussion of proposed U.S. Treasury regulations below, of gross proceeds of dispositions of certain types of property that produce U.S.-source FDAP income to, “foreign financial institutions” (which is broadly defined for this purpose and in general includes investment vehicles) and certain other non-U.S. entities unless various U.S. information reporting and due diligence requirements (generally relating to ownership by U.S. persons of interests in or accounts with those entities) have been satisfied, or an exemption applies. An intergovernmental agreement between the United States and an applicable foreign country may modify these requirements. In addition, regulations proposed by the U.S. Treasury Department (the preamble to which indicates that taxpayers may rely on the regulations pending their finalization) would eliminate the requirement under FATCA of withholding on gross proceeds. If FATCA withholding is imposed, a beneficial owner that is not a foreign financial institution generally may obtain a refund of any amounts withheld by filing a U.S. federal income tax return (which may entail significant administrative burden). Shareholders should consult their tax advisers regarding the effects of FATCA on an investment in the Trust.

An investment in the Units involves material risks as described below. These risks should also be read in conjunction with the other information included in this Annual Report, including the Trust’s financial statements and related notes thereto.

Summary Risk Factors

The following is a summary of some of the risks and uncertainties that could materially adversely affect our business, financial condition and results of operations. You should read this summary together with the more detailed description of each risk factor contained below.

Risk Factors Related to Digital Assets

●PROSPECTIVE SHAREHOLDERS ~~Digital~~ARE ~~assets~~URGED ~~such~~TO asCONSULT ~~Bitcoin~~THEIR ~~were~~TAX ~~only~~ADVISERS ~~introduced~~TO ~~within~~DISCUSS ~~the~~ALL ~~past~~TAX ~~decade,~~CONSIDERATIONS ~~and~~THAT ~~the~~MAY ~~medium-to-long~~BE ~~term~~RELEVANT ~~value~~TO ofTHEM ~~the~~ASSOCIATED ~~Units~~WITH isANY PURCHASE, ~~subject~~HOLDING, toSALE, aREDEMPTION ~~number~~OR ofOTHER ~~factors~~DEALING ~~relating~~IN toTHE ~~the~~SHARES ~~capabilities~~BEFORE ~~and~~DECIDING ~~development~~WHETHER ofTO ~~blockchain~~INVEST ~~technologies~~IN ~~and~~THE ~~to the fundamental investment characteristics of digital assets~~SHARES. ● Digital asset networks are developed by a diverse set of contributors and the perception that certain high-profile contributors will no longer contribute to the network could have an adverse effect on the market price of the related digital asset.

~~● The Bitcoin Network is part of a new~~ ERISA and ~~rapidly~~Related ~~evolving industry, and the value of the Units depends on the development and acceptance of the Bitcoin Network.~~Considerations

●ERISA and ASection ~~determination~~4975 ~~that~~of ~~Bitcoin~~the orCode ~~any~~impose certain requirements on employee benefit plans and certain other ~~digital~~plans ~~asset~~and isarrangements, aincluding IRAs ~~“security”~~and ~~may~~annuities, ~~adversely~~Keogh ~~affect~~plans, ~~the~~and ~~value~~certain ofcollective ~~Bitcoin~~investment funds or insurance company general or separate accounts in which such plans or arrangements are invested, that are subject to ERISA and/or ~~the~~Section ~~value~~4975 of the ~~Units~~Code (collectively, “Plans”), and on ~~result~~persons inwho ~~potentially~~are ~~extraordinary,~~fiduciaries ~~non-recurring~~with ~~expenses~~respect to, orthe ~~termination~~investment of ~~the~~Plan ~~Trust~~assets.

●Governmental plans, ~~Changes~~non-U.S. inplans ~~the~~and ~~governance~~certain ofchurch aplans ~~digital~~(collectively, ~~asset~~“Non-ERISA ~~network~~Arrangements”) ~~may~~are not ~~receive~~subject ~~sufficient~~to ~~support~~the ~~from~~fiduciary responsibility ~~users~~or ~~and~~prohibited ~~miners~~transaction provisions of ERISA or Section 4975 of the Code, ~~which~~but may ~~negatively~~be ~~affect~~subject ~~that~~to ~~digital~~similar ~~asset~~rules ~~network’s~~under ~~ability~~other federal, tostate, ~~grow~~local, ~~and~~non-U.S. ~~respond~~or toother ~~challenges~~applicable laws (“Similar Laws”).

●General Fiduciary ~~Digital asset networks face significant scaling challenges and efforts to increase the volume of transactions may not be successful.~~Matters

●In contemplating Aan ~~temporary~~investment of a portion of Plan assets in Shares, the Plan fiduciary responsible for making such investment should carefully consider, taking into account the facts and circumstances of the Plan, the risks discussed in this Annual Report, and whether such investment is consistent with its fiduciary responsibilities, including, but not limited to (i) whether the fiduciary has the authority to make the investment under the appropriate governing plan instrument, (ii) whether the investment would constitute a direct or ~~permanent~~indirect ~~fork~~non-exempt prohibited transaction under ERISA or athe ~~“clone”~~Code, ~~could~~(iii) ~~adversely~~the ~~affect~~Plan’s funding objectives, and (iv) whether under the ~~value~~general fiduciary standards of investment prudence and diversification such investment is appropriate for the ~~Units~~Plan, taking into account the overall investment policy of the Plan, the composition of the Plan’s investment portfolio and the Plan’s need for sufficient liquidity to pay benefits when due. Fiduciaries of Non-ERISA Arrangements should carefully consider whether an investment in Shares would violate any applicable Similar Laws.

●Plan Asset ~~Unitholders may not receive the benefits of any forks or “airdrops.”~~Issues

●Under the InU.S. ~~the~~Department ~~event~~of Labor’s regulations in Section 2510.3-101, as amended by Section 3(42) of ERISA (the “Plan Asset Regulations”), if a ~~hard~~Plan ~~fork~~invests in an equity interest of an entity that is “a publicly-offered security,” the ~~Bitcoin~~entity ~~Network~~will not be deemed to hold “plan assets” subject to ERISA, and a party managing the ~~Sponsor~~assets of such entity will not be subject to the fiduciary responsibility and prohibited transaction rules of ERISA and Section 4975 of the Code. A “publicly-offered security” is a security that is freely transferable, part of a class of securities that is widely held, and is either (i) part of a class of securities registered under Section 12(b) or 12(g) of the Exchange Act or (ii) sold to the plan as part of an offering of securities to the public pursuant to an effective registration statement under the Securities Act and the class of securities of which such security is a part is registered under the Exchange Act within 120 days (or such later time as may be allowed by the SEC) after the end of the fiscal year of the issuer during which the offering of such securities to the public occurred. Whether a security is “freely transferable” is a factual question determined on the basis of facts and circumstances. A class of securities is “widely-held” if ~~permitted~~it is a class of securities that is owned by 100 or more investors independent of the ~~terms~~issuer and of one another. It is anticipated that the Shares ~~Trust~~constitute ~~Agreement~~“publicly-offered securities” as defined in the Plan Asset Regulations, ~~use~~because ~~its~~the ~~discretion~~Shares to(i) ~~determine~~are ~~which~~being timely ~~network~~registered under the Exchange Act, (ii) should be considered “freely transferable” because they may be freely bought and sold on the ~~appropriate~~Listing ~~network~~Exchange, ~~for~~and (iii) should be considered “widely held” because they are owned by at least 100 investors independent of the Trust’s ~~purposes~~and of each other. Accordingly, only Shares held by a Plan, and not the underlying Bitcoin held in ~~doing~~the soTrust represented ~~may~~by ~~adversely~~the ~~affect~~Shares, should be treated as assets of the ~~value~~Plan, for purposes of applying the ~~Units~~fiduciary responsibility and prohibited transaction rules of ERISA and the Code.

●Investment by IfCertain ~~the~~Retirement digital asset award for solving blocks and transaction fees for recording transactions on the Bitcoin Network are not sufficiently high to incentivize miners, miners may cease expanding processing power or demand high transaction fees, which could negatively impact the value of Bitcoin and the value of the Units. ● The failure of several prominent crypto trading venues and lending platforms has impacted and may continue to impact the broader crypto economy, which could have an adverse impact on the Trust.Plans

~~Risk~~IRAs and ~~Factors~~participant-directed ~~Related~~accounts tounder tax-qualified retirement plans are limited in the ~~Bitcoin~~types of investments they may make under the ~~Markets~~Code. Potential purchasers of Shares that are IRAs or participant-directed accounts under a Code Section 401(a) plan should consult with their own advisors as to the consequences of an investment in Shares.

● The value of the Units relates directly to the value of Bitcoins, the value of which may be highly volatile and subject to fluctuations due to a number of factors. ● Due to the unregulated nature and lack of transparency surrounding the operations of Bitcoin exchanges, they may experience fraud, business failures, security failures or operational problems, which may adversely affect the value of Bitcoin and, consequently, the value of the Units. ● Recent developments in the digital asset economy have led to extreme volatility and disruption in digital asset markets, a loss of confidence in participants of the digital asset ecosystem, significant negative publicity surrounding digital assets broadly and market-wide declines in liquidity.Ineligible Purchasers

●In general, ~~Competition~~Shares ~~from~~may not be purchased with the ~~emergence~~assets of a Plan if the Trustee, the Sponsor, the distributor or ~~growth~~any of ~~other~~their ~~digital~~respective affiliates or employees either: (i) has investment discretion with respect to the investment of such Plan assets; (ii) has authority or ~~methods~~responsibility ofto ~~investing~~give inor ~~Bitcoin~~regularly ~~could~~gives ~~have~~investment advice with respect to such Plan assets, for a ~~negative~~fee, ~~impact~~and pursuant to an agreement or understanding that such advice will serve as a primary basis for investment decisions with respect to such Plan assets and that such advice will be based on the ~~price~~particular investment needs of ~~Bitcoin~~the Plan; or (iii) is an employer maintaining or contributing to such Plan. A party that is described in clause (i) or (ii) of the preceding sentence is a fiduciary under ERISA and ~~adversely~~the ~~affect~~Code with respect to the Plan, ~~value~~and ofany such purchase might result in a prohibited transaction under ERISA and/or the ~~Units~~Code, unless an exemption is available.

● Failure of funds that hold digital assets or that have exposure to digital assets through derivatives to receive SEC approval to list their shares on exchanges could adversely affect the value of the Units.

● NAV may not always correspond to the weighted-average market price of Bitcoin and, as a result, Units may be purchased (or redeemed, if ever permitted) at a value that differs from the secondary market price of the Units.

● Suspension or disruptions of market trading may adversely affect the value of units.

● The lack of active trading markets for the Units may result in losses on an investment in the Trust at the time of disposition of Units.

● A possible “short squeeze” due to a sudden increase in demand for the Units that largely exceeds supply may lead to price volatility in the Units.

● Difficulties or limitations in the processes of issuance and redemption (if any) of Units may interfere with opportunities for arbitrage transactions intended to keep the price of the Units closely linked to the price of Bitcoin, which may adversely affect an investment in the Units.

● Disruptions at OTC trading desks and potential consequences of an OTC trading desk’s failure could adversely affect an investment in the Units.

● Disruptions at Bitcoin exchanges and potential consequences of a Bitcoin exchange’s failure could adversely affect an investment in the Units.

● Momentum pricing of Bitcoin may subject the Bitcoin price to greater volatility and adversely affect an investment in the Units.

Risk Factors Related to the Trust and the Units

● The Trust has only a limited performance history.

● Unitholders are bound by the fee-shifting provision contained in the subscription agreement, which may discourage actions against us. ● Substantial sales or dispositions by a large Unitholder could negatively impact the price of our Units in the secondary market. ● Fees and expenses are charged regardless of profitability and may result in depletion of assets. ● The security of our Bitcoin Holdings cannot be assured by the Trust, the Custodian or any other person. ● The Custodian is not liable for any lost profits or any special, incidental, indirect, intangible, or consequential damages arising out of or in connection with authorized or unauthorized use of the Coinbase Custody site or the custodial services. ● The Trust does not maintain audit or inspection rights under the Custodial Services Agreement, and as such our Bitcoin Holdings held in the custodial account cannot be independently verified. ● Possibility of termination of the Trust may adversely affect a Unitholder’s portfolio. ● Any errors, discontinuance or changes in determining the value of the Bitcoin held by the Trust may have an adverse effect on the value of the Units. ● The value of the Units will be adversely affected if the Trust is required to indemnify the Sponsor or the Custodian as contemplated in the Trust Agreement or the Custodial Services Agreement. ● The Trust’s Bitcoin trading may subject the Trust to the risk of counterparty non-performance, potentially negatively affecting the market price of the Units. ● The Trust’s Bitcoin Holdings could become illiquid, which could cause large losses to Unitholders at any time or from time to time. ● Transactions in Bitcoin are irreversible, and the Trust may be unable to recover improperly transferred Bitcoin. ● The Trust’s Bitcoin may be lost, stolen, or subject to other inaccessibility. ● Any disruptions to the computer technology used by the Trust or its service providers could adversely affect the Trust’s ability to function and an investment in the Units. ● The Sponsor’s computer infrastructure may be vulnerable to security breaches. Any such problems could cause interruptions in the Trust’s operations and adversely affect an investment in the Units. ● Technology system failures could cause interruptions in the Trust’s ability to operate. ● Because the Units reflect the estimated accrued but unpaid expenses of the Trust, the number of Bitcoins represented by a Unit will gradually decrease over time as the Trust’s Bitcoins are used to pay the Trust’s expenses. ● Unitholders may not be able to withdraw or value his/her units upon death, legal disability, bankruptcy, insolvency, dissolution or withdrawal from the Trust. ● The Trust’s Bitcoin Holdings may be considered property of a bankruptcy estate should our Custodian initiate bankruptcy proceedings and the Trust could be considered an unsecured creditor, and the Custodian’s assets may not be adequate to satisfy a claim by the Trust. ● Risks associated with the Index. ● We concluded that certain of our previously issued financial statements should not be relied upon and restated certain of our previously issued financial statements, which was time-consuming and expensive and could expose us to additional risks that could have a negative effect on our Company. ● If we fail to maintain an effective system of internal controls, we may not be able to accurately report financial results or prevent fraud. ● Any dispute regarding the subscription agreement will be resolved by arbitration, which follows different procedures than in-court litigation and may be more restrictive to Unitholders asserting claims than in-court litigation. ● Pandemics, epidemics and other natural and man-made disasters could negatively impact the value of the Trust’s holdings and/or significantly disrupt its affairs.Representation

~~Risk~~Accordingly, by ~~Factors~~acceptance of Shares, each purchaser and subsequent transferee of Shares is deemed to represent and warrant that either (i) no portion ~~Related~~of the assets used by such purchaser or transferee to acquire or hold the ~~Regulation~~Shares constitutes assets of any Plan or Non-ERISA Arrangement or (ii) the ~~Trust~~acquisition, holding and subsequent disposition of the ~~Units~~Shares by such purchaser or transferee does not constitute or result in any non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of the Code or violate any applicable Similar Law.

●Certain ERISA ~~Regulation~~Plans ofmay ~~the~~be ~~Bitcoin~~required ~~industry continues~~ to ~~evolve~~report ~~and~~certain iscompensation ~~subject~~paid toby ~~change; future regulatory developments are impossible to predict but may significantly and adversely affect~~ the Trust. ●to ~~The sale of~~ the ~~Units could be subject to SEC or state securities registration. ● The~~ Trust’s isservice ~~not~~providers aon ~~registered~~Schedule ~~investment~~C ~~company. ● The Trust could be, or could become, subject~~ to the ~~Commodity~~ERISA ~~Exchange~~Plan’s ~~Act~~annual ~~(the~~Form ~~“CEA”)~~5500. ●To ~~Future U.S. and foreign regulation of~~ the ~~Bitcoin~~extent ~~market may impose other regulatory burdens~~applicable, ~~which~~any ~~could~~descriptions ~~harm~~of ~~the~~such ~~Trust~~compensation orherein ~~even~~are ~~cause~~intended ~~the Trust~~ to liquidate. ● Banks may not provide banking services, or may cut off banking services, to businesses that provide Bitcoin-related services or that accept Bitcoin as payment, which could directly impact satisfy the ~~Trust’s~~disclosure ~~operations,~~requirements ~~damage~~for ~~the~~“eligible ~~public~~indirect ~~perception~~compensation” offor ~~Bitcoin~~purposes ~~and the utility~~ of ~~Bitcoin as a payment system and could decrease~~ the ~~price~~alternative ofreporting ~~Bitcoin~~option ~~and~~on ~~adversely affect an investment in the Units~~Schedule C. ● It may be illegal now, or in the future, to acquire, own, hold, sell or use Bitcoin in one or more countries, and ownership of, holding or trading in Units may also be considered illegal and subject to sanctions.

31Except as otherwise set forth, the foregoing statements regarding the consequences under ERISA and the Code of an investment in the Trust are based on the provisions of ERISA and the Code as currently in effect, and the existing administrative and judicial interpretations thereunder. No assurance can be given that administrative, judicial or legislative changes will not occur that may make the foregoing statements incorrect or incomplete.

● If the Bitcoin Network is used to facilitate illicit activities, businesses that facilitate transactions in Bitcoin could be at increased risk of criminal and civil lawsuits, or of having services cut off, which could negatively affect the price of Bitcoin and the value of the UnitsITEM 1A. ●RISK If regulatory changes or interpretations of the Trust’s or Sponsor’s activities require registration as money services businesses under the regulations promulgated by FinCEN under the authority of the U.S. Bank Secrecy Act or as money transmitters or digital currency businesses under state regimes for the licensing of such businesses, the Trust and/or Sponsor could suffer reputational harm and also extraordinary, recurring and/or non-recurring expenses, which would adversely impact an investment in the Units. ● The treatment of the Trust for U.S. federal income tax purposes is uncertain. ● Unitholders could incur a tax liability without an associated distribution. ● The treatment of Bitcoin for U.S. federal income tax purposes is uncertain. ● Future developments regarding the treatment of digital currency for U.S. federal income tax purposes could adversely affect the value of the Units. ● Future developments in the treatment of digital currency for tax purposes other than U.S. federal income tax purposes could adversely affect the value of the Units. ● A U.S. tax-exempt Unitholder may recognize UBTI a consequence of an investment in Units. ● Non-U.S. Holders may be subject to U.S. federal withholding tax on income derived from forks, airdrops and similar occurrences.FACTORS

~~Risk~~The Shares ~~Factors~~are ~~Related~~speculative toand ~~Potential~~involve ~~Conflicts~~ a high degree of ~~Interest~~risk. Before making an investment decision, you should consider carefully the risks described below, as well as the other information included in this Annual Report.

● Potential conflicts of interest may arise among the Sponsor or its affiliates and the Trust. The Sponsor and its affiliates have no fiduciary duties to the Trust and its Unitholders other than as provided in the Trust Agreement, which may permit them to favor their own interests to the detriment of the Trust and its Unitholders. ● Unitholders cannot be assured of the Sponsor’s continued services, the discontinuance of which may be detrimental to the Trust. ● If the Custodian resigns or is removed by the Sponsor or otherwise, without replacement, it could trigger early termination of the Trust, or the Sponsor would need to find and appoint a replacement custodian, which could pose a challenge to the safekeeping of the Trust’s Bitcoin. ● Unitholders may be adversely affected by the lack of independent advisers representing investors in the Trust.

Risk Factors Related to Digital Assets

~~Digital~~The trading ~~assets~~prices ~~such~~of asmany digital assets, including Bitcoin, ~~were only~~have ~~introduced~~experienced ~~within~~extreme ~~the~~volatility ~~past~~in ~~decade,~~recent periods and ~~the~~may ~~medium-~~continue to~~-long~~ ~~term~~do so. ~~value~~Extreme ofvolatility in the ~~Units~~future, isincluding ~~subject~~further todeclines ain ~~number~~the trading prices of ~~factors~~Bitcoin, ~~relating to~~could ~~the~~have ~~capabilities~~a ~~and~~material ~~development~~adverse effect on the value of ~~blockchain~~the ~~technologies~~Shares and to the ~~fundamental~~Shares ~~investment~~could ~~characteristics~~lose all or substantially all of ~~digital~~their ~~assets~~value.

~~Digital~~The trading prices of many digital assets, ~~such as~~including Bitcoin, have experienced extreme volatility in recent periods and may continue to do so. These increases were ~~only~~followed ~~introduced~~by ~~within~~steep ~~the~~drawdowns ~~past~~throughout ~~decade~~2022 in digital asset trading prices, ~~and~~including for Bitcoin. In the ~~medium~~2021-~~to-long~~2022 cycle, ~~term~~the ~~value~~price of ~~the~~Bitcoin ~~Units~~peaked isat ~~subject~~$67,734 toand bottomed at $15,632, marking a ~~number~~steep 77% drawdown. These episodes of rapid price appreciation ~~factors~~followed ~~relating~~by tosteep ~~the~~drawdowns ~~capabilities~~have ~~and~~occurred ~~development~~multiple oftimes ~~blockchain~~throughout ~~technologies~~Bitcoin’s history, ~~such~~including asin 2011, 2013-2014, and 2017-2018, before repeating again in 2021-2022. Over the ~~infancy~~course of ~~their~~2023 ~~development~~and 2024, ~~their~~Bitcoin prices continued to exhibit extreme volatility. After ~~dependence~~the onresults of the ~~internet~~U.S. ~~and~~presidential ~~other~~election ~~technologies~~in November 2024, ~~their~~the ~~dependence~~price onof ~~the~~Bitcoin ~~role~~rallied ~~played~~to bya ~~miners~~then ~~and~~all-time ~~developers~~high ~~and~~of ~~the~~over ~~potential~~$100,000 ~~for~~in ~~malicious~~December ~~activity.~~2024 ~~For example~~based, ~~the~~in ~~realization~~part, ofon ~~one~~the ormarket’s ~~more~~perception ofthat the ~~following~~new ~~risks~~presidential ~~could~~administration ~~materially~~would ~~adversely~~be ~~affect~~pro-digital ~~the~~assets. ~~value~~During 2025, Bitcoin prices swung between a low of ~~the~~$76,737 ~~Units:~~to a high of $125,663.

●Extreme volatility ~~The~~may ~~trading~~persist ~~prices~~and the value of ~~many~~the ~~digital~~Shares ~~assets,~~may ~~including~~significantly ~~Bitcoin,~~decline ~~have~~in ~~experienced~~the ~~extreme~~future ~~volatility~~without inrecovery. ~~recent~~The ~~periods~~digital ~~and~~asset markets may ~~continue~~still tobe doexperiencing ~~so.~~a ~~For~~bubble ~~instance,~~or ~~there~~may ~~were~~experience ~~steep~~a ~~increases~~bubble again in the ~~value~~future. For example, in the first half of ~~certain~~2022, ~~digital~~each ~~assets~~of Celsius Network, ~~including~~Voyager ~~Bitcoin~~Digital Ltd., ~~over~~and ~~the~~Three ~~course~~Arrows ofCapital ~~2017~~declared bankruptcy, ~~followed~~resulting byin ~~steep~~a ~~drawdowns~~loss ~~throughout~~of ~~2018~~confidence in participants of the digital asset ~~trading~~ecosystem ~~prices,~~and ~~including~~negative ~~for~~publicity ~~Bitcoin~~surrounding digital assets more broadly. ~~These~~In ~~drawdowns~~November ~~notwithstanding~~2022, ~~Bitcoin~~FTX ~~prices~~Trading ~~increased~~Ltd. ~~significantly~~(“FTX”), one ~~again~~of ~~during~~the ~~2019,~~largest ~~decreased~~digital ~~significantly~~asset ~~again~~platforms inby volume at the ~~first~~time, ~~quarter~~halted customer withdrawals amid rumors of ~~2020~~the ~~amidst~~company’s ~~broader~~liquidity issues ~~market~~and ~~declines~~likely asinsolvency, awhich ~~result~~were ofsubsequently ~~the~~corroborated ~~novel~~by ~~coronavirus~~its ~~outbreak~~CEO. ~~and~~Shortly ~~increased~~thereafter, ~~significantly~~FTX’s ~~again~~CEO ~~over~~resigned ~~the~~and ~~remainder~~FTX and many of ~~2020~~its ~~and~~affiliates filed for bankruptcy in the ~~first~~United ~~quarter~~States, ofwhile ~~2021.~~other ~~The~~affiliates ~~price~~have ofentered ~~Bitcoin~~insolvency, ~~continued~~liquidation, toor ~~experience~~similar proceedings ~~significant~~around ~~and~~the ~~sudden~~globe, ~~changes~~following ~~throughout~~which ~~2021~~the ~~followed~~U.S. byDepartment ~~steep~~of ~~drawdowns~~Justice inbrought criminal fraud and other charges, and the ~~fourth~~SEC ~~quarter~~and CFTC ofbrought ~~2021~~civil securities and ~~throughout~~commodities ~~2022.~~fraud ~~The~~charges, ~~price~~against certain of ~~Bitcoin~~FTX’s ~~has~~and ~~continued~~its toaffiliates’ ~~fluctuate~~senior toexecutives, including ~~date~~its informer ~~2023~~CEO. In ~~particular~~addition, several other entities in the digital asset ~~prices~~industry ~~have~~filed ~~experienced~~for ~~extreme~~bankruptcy ~~volatility~~following ~~since~~FTX’s bankruptcy ~~November~~filing, ~~2022~~such ~~when~~as ~~FTX~~BlockFi ~~Trading~~Inc. ~~Ltd~~and Genesis Global Capital, LLC. In response to these events (collectively, the “~~FTX~~2022 Events”), the ~~halted~~digital ~~customer~~asset ~~withdrawals.~~markets ~~See~~have ~~“—Recent~~experienced ~~developments~~extreme price volatility and other entities in the digital asset ~~economy~~industry have ~~led~~been, and may continue to ~~extreme~~be, ~~volatility~~negatively ~~and~~affected, ~~disruption~~further undermining confidence in the digital asset markets,. aThese ~~loss~~events ofalso ~~confidence~~negatively inimpacted the ~~participants~~liquidity of the digital asset ~~ecosystem,~~markets as certain entities affiliated with FTX engaged in significant ~~negative~~trading ~~publicity~~activity. ~~surrounding~~If the liquidity of the digital ~~assets~~asset ~~broadly~~markets ~~and~~were ~~market-wide~~to ~~decline~~be innegatively ~~liquidity.”~~impacted ~~Extreme~~by ~~volatility~~similar events in the future, digital asset prices, including ~~further~~Bitcoin, may continue to experience significant volatility or price declines and confidence in the ~~trading~~digital ~~prices~~asset ofmarkets ~~Bitcoin~~may be undermined. In addition, ~~could~~regulatory ~~have~~and enforcement scrutiny increased as a ~~material~~result ~~adverse~~of ~~effect~~such onevents, including from, among others, the ~~value~~Department of Justice, the ~~Units~~SEC, ~~and~~the CFTC, the ~~Units~~White ~~could~~House ~~lose~~and ~~all~~Congress, oras ~~substantially~~well ~~all~~as ofstate ~~their~~regulators ~~value~~and authorities. ~~Furthermore,~~It ~~negative~~is ~~perception,~~not apossible ~~lack~~to ofpredict ~~stability~~all ~~and~~of ~~standardized~~the risks ~~regulation~~of inpast ~~the~~or ~~digital~~future ~~asset~~events ~~economy~~that may ~~reduce~~result in a loss of confidence in the digital asset ~~economy~~ecosystem and/or ~~may~~expose ~~result~~the inTrust, ~~greater~~its ~~volatility~~service providers inor the ~~price~~digital ofasset ~~Bitcoin~~industry ~~and~~as ~~other~~a ~~digital~~whole ~~assets,~~to ~~including~~extreme aprice ~~depreciation in value~~volatility.

The value of Bitcoin as represented by the Index may also be subject to momentum pricing due to speculation regarding future appreciation in value, leading to greater volatility that could adversely affect the value of the Shares. Momentum pricing typically is associated with growth stocks and other assets whose valuation, as determined by the investing public, accounts for future appreciation in value, if any. The Sponsor believes that momentum pricing of Bitcoin has resulted, and may continue to result, in speculation regarding future appreciation in the value of Bitcoin, inflating and making the Index more volatile. As a result, Bitcoin may be more likely to fluctuate in value due to changing investor confidence, which could impact future appreciation or depreciation in the Index and could adversely affect the value of the Shares.

Market participants may also act based on perceptions that digital assets are subject to a more favorable regulatory environment compared to that of traditional financial instruments. False perceptions about the regulatory oversight of Bitcoin may contribute to increased speculative interest, elevated trading volumes and inflated valuations.

Extreme volatility in the future, including further declines in the trading prices of Bitcoin, could have a material adverse effect on the value of the Shares and the Shares could lose all or substantially all of their value. The Trust is not actively managed and does not take any actions to take advantage, or mitigate the impacts, of volatility in the price of Bitcoin.

The value of the Shares is subject to a number of factors relating to the fundamental investment characteristics of Bitcoin as a digital asset, including the fact that digital assets are bearer instruments and loss, theft, or compromise of the associated private keys could result in permanent loss of the asset, and the capabilities and development of blockchain technologies such as the Bitcoin blockchain.

Digital assets such as Bitcoin were only introduced within the past 16 years, and the value of the Shares is subject to a number of factors over time relating to the capabilities and development of blockchain technologies, such as the recentness of their development, their dependence on the internet and other technologies, their dependence on the role played by users, developers and miners and the potential for malicious activity. For example, the realization of one or more of the following risks could materially adversely affect the value of the Shares:

●	Digital asset networks, including the Bitcoin network, and the software used to operate them are in the early stages of development. Given the recentness of the development of digital asset networks, digital assets may not function as intended and parties may be unwilling to use digital assets, which would dampen the growth, if any, of digital asset networks. Because Bitcoin is a digital asset, the value of the Shares is subject to a number of factors relating to the fundamental investment characteristics of digital assets, including the fact that digital assets are bearer instruments and loss, theft, compromise, or destruction of the associated private keys could result in permanent loss of the asset.

●	Digital assets, including Bitcoin, are controllable only by the possessor of both the unique public key and private key or keys relating to the Bitcoin network address, or “wallet,” at which the digital asset is held. Private keys must be safeguarded and kept private in order to prevent a third-party from accessing the digital asset held in such wallet. The loss, theft, compromise or destruction of a private key required to access a digital asset may be irreversible. If a private key is lost, stolen, destroyed or otherwise compromised and no backup of the private key is accessible, the owner would be unable to access the digital asset corresponding to that private key and the private key will not be capable of being restored by the digital asset network resulting in the total loss of the value of the digital asset linked to the private key.

●	Digital asset networks are dependent upon the internet. A disruption of the internet or a digital asset network, such as the Bitcoin network, would affect the ability to transfer digital assets, including Bitcoin, and, consequently, their value.

●	The acceptance of software patches or upgrades by a significant, but not overwhelming, percentage of the users and miners in a digital asset network, such as the Bitcoin network, could result in a “fork” in such network’s blockchain, including the Bitcoin blockchain, resulting in the operation of multiple separate networks.

●	Governance of the Bitcoin network is by voluntary consensus and open competition. As a result, there may be a lack of consensus or clarity on the governance of the Bitcoin network, which may stymie the Bitcoin network’s utility and ability to grow and face challenges. In particular, it may be difficult to find solutions or marshal sufficient effort to overcome any future problems on the Bitcoin network, especially long-term problems.

●	Over the past decade, Bitcoin mining operations have evolved from individual users mining with computer processors, graphics processing units and first-generation application specific integrated circuit machines to “professionalized” mining operations using proprietary hardware or sophisticated machines. If the profit margins of Bitcoin mining operations are not sufficiently high, including due to an increase in electricity costs or a decline in the market price of Bitcoin, or if Bitcoin mining operations are unable to arrange alternative sources of financing (e.g., if lenders refuse to make loans to such miners), Bitcoin miners are more likely to immediately sell more Bitcoin than they otherwise would, resulting in an increase in liquid supply of Bitcoin, which would generally tend to reduce Bitcoin’s market price.

● ~~Digital~~To ~~asset~~the ~~networks~~extent ~~and~~that any miners cease to record transactions that do not include the ~~software~~payment ~~used~~of a transaction fee in solved blocks or do not record a transaction because the transaction fee is too low, such transactions will not be recorded on the Bitcoin blockchain until a block is mined by a miner who does not require the payment of transaction fees or is willing to ~~operate~~accept ~~them~~a ~~are~~lower fee. Any widespread delays in the ~~early~~recording ~~stages~~of transactions could result in a loss of ~~development~~confidence in a digital asset network. ● Digital ~~assets~~asset mining operations can consume significant amounts of electricity, which may have ~~experienced~~a negative environmental impact and give rise to public opinion against allowing, or government regulations restricting, the use of electricity for mining operations. Additionally, miners may be forced to cease operations during an electricity shortage or power outage, or if electricity prices increase where the mining activities are performed. ● Many digital asset networks, including the Bitcoin network, face significant scaling challenges and wemay ~~expect~~periodically ~~will~~be ~~experience~~upgraded inwith various features designed to increase the ~~future~~speed and throughput of digital asset transactions. These attempts to increase the volume of transactions may not be effective, ~~sharp~~and ~~fluctuations~~such upgrades may fail, resulting in potentially irreparable damage to the Bitcoin network and to the value of Bitcoin. ~~Given~~● ~~the~~The ~~infancy~~open-source structure of many digital asset network protocols, such as the ~~development~~protocol for the Bitcoin network, means that developers and other contributors are generally not directly compensated for their contributions in maintaining and developing such protocols. As a result, the developers and other contributors of a particular digital asset ~~networks~~may lack a financial incentive to maintain or develop the network, ~~parties~~or may lack the resources to adequately address emerging issues. Alternatively, some developers may be ~~unwilling~~funded by companies whose interests are at odds with other participants in a particular digital asset network. A failure to ~~transact~~properly monitor and upgrade the protocol of the Bitcoin network could damage that network. ● Moreover, in the past, flaws in the source code for digital assets have been exposed and exploited, ~~which~~including ~~would~~flaws ~~dampen~~that disabled some functionality for users, exposed users’ personal information and/or resulted in the ~~growth~~theft of users’ digital assets. The cryptography underlying Bitcoin could prove to be flawed or ineffective, ifor developments in mathematics and/or technology, including advances in digital computing, algebraic geometry and quantum computing, could result in such cryptography becoming ineffective. In any of these circumstances, a malicious actor may be able to compromise the security of the Bitcoin network or take the Trust’s Bitcoin, which would adversely affect the value of the Shares. Moreover, functionality of the Bitcoin network may be negatively affected such that it is no longer attractive to users, thereby dampening demand for Bitcoin. Even if another digital asset ~~networks~~other than Bitcoin were affected by similar circumstances, any reduction in confidence in the source code or cryptography underlying digital assets generally could negatively affect the demand for digital assets and therefore adversely affect the value of the Shares.

● Digital asset networks are dependent upon the internet. A disruption of the internet or a digital asset network, such as the Bitcoin Network, would affect the ability to transfer digital assets, including Bitcoin, and, consequently, their value. ● The acceptance of software patches or upgrades by a significant, but not overwhelming, percentage of the users and miners in a digital asset network, such as the Bitcoin Network, could result in a fork in such network’s blockchain, resulting in the operation of multiple separate networks. ● Governance of the Bitcoin Network is by voluntary consensus and open competition. As a result, there may be a lack of consensus or clarity on the governance of the Bitcoin Network, which may stymie the Bitcoin Network’s utility and ability to grow and face challenges. In particular, it may be difficult to find solutions or marshal sufficient effort to overcome any future problems on the Bitcoin Network, especially long-term problems. ● The foregoing notwithstanding, the Bitcoin Network’s protocol is informally managed by a group of core developers that propose amendments to the Bitcoin Network’s source code. The core developers evolve over time, largely based on self-determined participation. To the extent that a significant majority of users and miners adopt amendments to the Bitcoin Network, the Bitcoin Network will be subject to new protocols that may adversely affect the value of Bitcoin. ● The loss or destruction of a private key required to access a digital asset such as Bitcoin may be irreversible. If a private key is lost, destroyed or otherwise compromised and no backup of the private key is accessible, the Trust will be unable to access the Bitcoin held in the Custodial Account corresponding to that private key and the private key will not be capable of being restored by the Bitcoin Network. ● Bitcoin is only selectively accepted as a means of payment by retail and commercial outlets, and use of Bitcoins by consumers to pay such retail and commercial outlets remains limited. Banks and other established financial institutions may refuse to process funds for Bitcoin transactions; process wire transfers to or from Bitcoin exchanges, Bitcoin-related companies or service providers; or maintain accounts for persons or entities transacting in Bitcoin. As a result, the prices of Bitcoins are largely determined by speculators and miners, thus contributing to price volatility that makes retailers less likely to accept it as a form of payment in the future. ● Miners, developers and users may switch to or adopt certain digital assets at the expense of their engagement with other digital asset networks, which may negatively impact those networks, including the Bitcoin Network. ● Over the past several years, digital asset mining operations have evolved from individual users mining with computer processors, graphics processing units and first-generation application specific integrated circuit machines to “professionalized” mining operations using proprietary hardware or sophisticated machines. If the profit margins of digital asset mining operations are not sufficiently high, digital asset miners are more likely to immediately sell tokens earned by mining, resulting in an increase in liquid supply of that digital asset, which would generally tend to reduce that digital asset’s market price. ● To the extent that any miners cease to record transactions that do not include the payment of a transaction fee in solved blocks or do not record a transaction because the transaction fee is too low, such transactions will not be recorded on the Blockchain until a block is solved by a miner who does not require the payment of transaction fees or is willing to accept a lower fee. Any widespread delays in the recording of transactions could result in a loss of confidence in the digital asset network. ● Many digital asset networks face significant scaling challenges and are being upgraded with various features to increase the speed and throughput of digital asset transactions. These attempts to increase the volume of transactions may not be effective. ● The open-source structure of many digital asset network protocols, such as the protocol for the Bitcoin Network, means that developers and other contributors are generally not directly compensated for their contributions in maintaining and developing such protocols. As a result, the developers and other contributors of a particular digital asset may lack a financial incentive to maintain or develop the network, or may lack the resources to adequately address emerging issues. Alternatively, some developers may be funded by companies whose interests are at odds with other participants in a particular digital asset network. A failure to properly monitor and upgrade the protocol of the Bitcoin Network could damage that network. ● Banks may not provide banking services, or may cut off banking services, to businesses that provide digital asset-related services or that accept digital assets as payment, which could dampen liquidity in the market and damage the public perception of digital assets generally or any one digital asset in particular, such as Bitcoin, and their or its utility as a payment system, which could decrease the price of digital assets generally or individually.

Moreover, because digital assets, including Bitcoin, have been in existence for a short period of time and are continuing to develop, there may be additional risks in the future that are impossible to predict as of the date of this Annual Report.

~~The Bitcoin Network~~Digital isassets ~~part~~represent of a new and rapidly evolving industry, and the value of the ~~Units~~Shares depends on the ~~development~~continued ~~and~~ acceptance of ~~the~~ Bitcoin ~~Network~~.

The Bitcoin ~~Network~~ network was first launched in 2009 and ~~Bitcoins~~Bitcoin ~~were~~was the first cryptographic digital ~~assets~~asset created to gain global adoption and ~~critical~~ critical mass. Although the Bitcoin ~~Network~~network is the most established digital asset network, the Bitcoin ~~Network~~network and other cryptographic and algorithmic protocols governing the issuance of digital assets represent a new and rapidly evolving industry that is subject to a variety of factors that are difficult to evaluate. For example, the realization of one or more of the following risks could materially adversely affect the value of the Shares:

	●	Bitcoin has only recently become selectively accepted as a means of payment by retail and commercial outlets, and use of Bitcoin by consumers to pay such retail and commercial outlets remains limited. Banks and other established financial institutions may refuse to process funds for Bitcoin transactions; process wire transfers to or from digital asset platforms, Bitcoin-related companies or service providers; or maintain accounts for persons or entities transacting in Bitcoin. As a result, the price of Bitcoin may be influenced to a significant extent by speculators and miners, thus contributing to price volatility that makes retailers less likely to accept it as a form of payment in the future.

	●	Banks may not provide banking services, or may cut off banking services, to businesses that provide digital asset-related services or that accept digital assets as payment, which could dampen liquidity in the market and damage the public perception of digital assets generally or any one digital asset in particular, such as Bitcoin, and their or its utility as a payment system, which could decrease the price of digital assets generally or individually. Further, the lack of availability of banking services could prevent the Trust from being able to complete creations and redemptions of Baskets, the timely liquidation of Bitcoin and withdrawal of assets from the Bitcoin Custodian even if the Sponsor determined that such liquidation was appropriate or suitable, or otherwise disrupt the Trust’s operations.

● ~~cryptographic~~Certain ~~and algorithmic~~privacy-preserving ~~protocols~~features ~~governing~~have ~~the~~been ~~issuance~~or ofare expected to be introduced to digital ~~assets~~asset ~~represent~~networks, asuch ~~new~~as the Bitcoin network, and ~~rapidly~~platforms ~~evolving~~or ~~industry~~businesses that isfacilitate ~~subject~~transactions ~~to a~~in ~~variety~~Bitcoin ofmay ~~factors~~be ~~that~~at ~~are~~an ~~difficult~~increased torisk ~~evaluate.~~of ~~For~~criminal ~~example~~or civil lawsuits, or of having banking services cut off if there is a concern that these features interfere with the ~~realization~~performance of ~~one~~anti-money laundering duties and economic sanctions checks or ~~more~~facilitate ofillicit ~~the~~financing ~~following~~or ~~risks~~crime. ~~could~~● ~~materially adversely~~Users, ~~affect~~developers and miners may otherwise switch to or adopt certain digital assets at the ~~value~~expense of their engagement with other digital asset networks, which may negatively impact those networks, including the ~~Units:~~Bitcoin network.

●The Trust Asis ~~the~~not ~~Bitcoin~~actively ~~Network~~managed ~~continues to develop~~ and ~~grow,~~does certain technical issues might be uncovered, and the troubleshooting and resolution of such issues requires the attention and efforts of Bitcoin’s global development community. ● In August 2017, the Bitcoin Network underwent a hard fork that resulted in the creation of a new digital asset network called Bitcoin Cash. This hard fork was contentious, and as a result some users of the Bitcoin Cash network may harbor ill will toward the Bitcoin Network. These users may attempt to negatively impact the use or adoption of the Bitcoin Network. ● Also in August 2017, the Bitcoin Network was upgraded with a technical feature known as “Segregated Witness” that, among other things, potentially doubles the transactions per second that can be handled on-chain and enables so-called second layer solutions, such as the Lightning Network or payment channels, that have the potential to substantially increase transaction throughput (i.e., millions of transactions per second). As of the date of this Annual Report, digital wallets and intermediaries that support Segregated Witness or Lightning Network-like technologies do not ~~yet~~ have ~~material~~any ~~adoption.~~formal ~~This~~strategy ~~upgrade~~relating ~~may fail~~ to ~~work~~the asdevelopment ~~expected leading to a decline in support and price~~ of ~~Bitcoin. ● In 2021,~~ the Bitcoin ~~protocol implemented the Taproot upgrade to add enhanced support for complex transactions on the~~ network ~~such as multi-signature transactions, which require two or more parties to execute a transaction on the Bitcoin Network~~. Prior to the upgrade, multi-signature transactions were historically slow, expensive, and easily identifiable. Taproot is intended to reduce the amount of data written to a block and makes multi-signature transactions indistinguishable from regular transactions, adding an enhanced layer of privacy. This upgrade may fail to work as expected, which could lead to a decline in support and price of Bitcoin.

Moreover, in the past, flaws in the source code for digital assets have been exposed and exploited, including flaws that disabled some functionality for users, exposed users’ personal information and/or resulted in the theft of users’ digital assets. The cryptography underlying Bitcoin could prove to be flawed or ineffective, or developments in mathematics and/or technology, including advances in digital computing, algebraic geometry and quantum computing, could result in such cryptography becoming ineffective. In any of these circumstances, a malicious actor may be able to take the Trust’s Bitcoin, which would adversely affect the value of the Units. Moreover, functionality of the Bitcoin Network may be negatively affected such that it is no longer attractive to users, thereby dampening demand for Bitcoin. Even if another digital asset other than Bitcoin were affected by similar circumstances, any reduction in confidence in the source code or cryptography underlying digital assets generally could negatively affect the demand for digital assets and therefore adversely affect the value of the Units.

The Trust is not actively managed and will not have any formal strategy relating to the development of the Bitcoin Network.

Digital asset networks are developed by a diverse set of contributors and the perception that certain high-profile contributors will no longer contribute to the network could have an adverse effect on the market price of the related digital asset.

Digital asset networks are often developed by a diverse set of contributors and the perception that high-profile contributors may no longer contribute to the networks may have an adverse effect on the market price of any related digital assets. For example, in June 2017, an unfounded rumor circulated that Ethereum protocol developer Vitalik Buterin had died. Following the rumor, the price of Ethereum decreased approximately 20% before recovering after Buterin himself dispelled the rumor. Some have speculated that the rumor led to the decrease in the price of Ethereum. In the event a high-profile contributor to the Bitcoin Network is perceived as no longer able to contribute to the Bitcoin Network due to death, retirement, withdrawal, incapacity, or otherwise, whether or not such perception is valid, it could negatively affect the price of Bitcoin, which could adversely impact the value of the Units.

Digital assets may have concentrated ownership and large sales or distributions by holders of such digital assets could have an adverse effect on the market price of such digital asset.

As of January 28, 2022, the largest 100 Bitcoin digital wallets held approximately 13.49% of the Bitcoins in circulation and it is possible that some of these digital wallets are controlled by the same person or entity. Moreover, it is possible that other persons or entities control multiple digital wallets that collectively hold a significant number of Bitcoin, even if they individually only hold a small amount. As a result of this concentration of ownership, large sales by such holders could have an adverse effect on the market price of Bitcoin.

A determination that Bitcoin or any other digital asset is a “security” may adversely affect the value of Bitcoin and the value of the Units, and result in potentially extraordinary, non-recurring expenses to, or termination of the Trust

The SEC has stated that certain digital assets may be considered “securities” under the federal securities laws. The test for determining whether a particular digital asset is a “security” is complex and the outcome is difficult to predict. Further, if any other digital

asset is determined to be a “security” under federal or state securities laws by the SEC or any other agency, or in a proceeding in a court of law or otherwise, it may have material adverse consequences for Bitcoin as a digital asset due to negative publicity or a decline in the general acceptance of digital assets. As such, any determination that Bitcoin or any other digital asset is a security under federal or state securities laws may adversely affect the value of Bitcoin and, as a result, the value of the Units.

To the extent that Bitcoin is determined to be a security, the Trust and the Sponsor may also be subject to additional regulatory requirements, including under the Investment Company Act of 1940 (the “Investment Company Act”), and the Sponsor may be required to register as an investment adviser under the Investment Advisers Act of 1940, as amended (the “Advisers Act”). If the Sponsor determines not to comply with such additional regulatory and registration requirements, the Sponsor will terminate the Trust. Any such termination could result in the liquidation of the Trust’s Bitcoin at a time that is disadvantageous to Unitholders.

Changes in the governance of a digital asset network may not receive sufficient support from users and miners, which may negatively affect that digital asset network’s ability to grow and respond to challenges.

The governance of decentralized networks, such as the Bitcoin ~~and Ethereum networks~~network, is by voluntary consensus and open competition. As a result, there may be a lack of consensus or clarity on the governance of any particular decentralized digital asset network, which may stymie such network’s utility and ability to grow and face challenges. The foregoing notwithstanding, the protocols for some decentralized networks, such as the Bitcoin network, are informally managed by a group of core developers that propose amendments to the relevant network’s source code. Core developers’ roles evolve over time, largely based on self-determined participation. If a significant majority of users and miners adopt amendments to a decentralized network based on the proposals of such core developers, such network will be be subject to new protocols that may adversely affect the value of the relevant digital asset.

As a result of the foregoing, it may be difficult to find solutions or marshal sufficient effort to overcome any future problems, especially long-term problems, on digital asset networks.

~~Digital~~Potential amendments ~~asset~~to ~~networks~~the ~~face~~Bitcoin ~~significant scaling~~network’s ~~challenges~~protocols and ~~efforts~~software tocould, ~~increase~~if accepted and authorized by the ~~volume~~Bitcoin ofnetwork community, ~~transactions~~adversely ~~may~~affect ~~not~~an beinvestment ~~successful~~in the Trust.

~~Many~~The Bitcoin ~~digital~~network ~~asset~~uses ~~networks face~~a ~~significant~~cryptographic ~~scaling~~protocol ~~challenges~~to ~~due~~govern tothe interactions within the ~~fact~~Bitcoin ~~that~~network. ~~public~~A ~~blockchains~~loose ~~generally~~community ~~face~~known aas ~~trade-off~~the ~~regarding~~core developers ~~security~~has ~~and~~evolved ~~scalability~~to informally manage the source code for the protocol. ~~One~~ ~~means~~Membership ~~through~~in ~~which~~the ~~public~~community ~~blockchains~~of ~~achieve~~core ~~security~~developers isevolves ~~decentralization~~over time, ~~meaning~~largely ~~that~~based noon ~~intermediary~~self-determined isparticipation ~~responsible~~in ~~for securing~~the ~~and~~resource ~~maintaining~~section ~~these~~dedicated ~~systems~~to Bitcoin on Github.com. ~~For~~The ~~example~~core developers can propose amendments to the Bitcoin network’s source code that, aif ~~greater~~accepted ~~degree~~by ofminers ~~decentralization~~and ~~generally~~users, ~~means~~could aalter ~~given~~the ~~digital~~protocols ~~asset~~and ~~network~~software isof ~~less~~the ~~susceptible~~Bitcoin tonetwork ~~manipulation~~and orthe ~~capture~~properties of Bitcoin. InThese ~~practice~~alterations would occur through software upgrades, ~~this~~and ~~typically~~could ~~means~~potentially include ~~that~~changes ~~every~~to ~~single~~the ~~node~~irreversibility of transactions and limitations on athe ~~given~~mining ~~digital asset~~of ~~network~~new isBitcoin, ~~responsible~~which ~~for~~could ~~securing~~undermine the ~~system~~appeal and bymarket ~~processing~~value ~~every~~of ~~transaction~~Bitcoin. Alternatively, software upgrades and ~~maintaining~~other achanges ~~copy~~to the protocols of the ~~entire~~Bitcoin ~~state~~network could fail to ofwork as intended or could introduce bugs, security risks, or otherwise adversely affect, the speed, security, usability, or value of the Bitcoin network or Bitcoin. As a result, athe ~~digital~~Bitcoin ~~asset~~ network ~~may~~could be ~~limited~~subject into ~~the~~changes ~~number~~to ofits ~~transactions~~protocols itand ~~can~~software ~~process~~in by the ~~capabilities~~future ofthat ~~each~~may ~~single~~adversely ~~fully~~affect ~~participating~~an ~~node~~investment in the Trust.

~~As corresponding increases~~The inopen-source ~~throughput~~structure ~~lag behind growth in the use~~ of ~~digital asset networks, average fees and settlement times may increase considerably. For example,~~ the Bitcoin ~~Network~~network ~~has~~protocol ~~been,~~means atthat ~~times,~~the atcore ~~capacity,~~developers ~~which~~and ~~has~~other ~~led~~contributors toare ~~increased~~generally ~~transaction~~not ~~fees. Since January 1,~~directly ~~2017,~~compensated ~~Bitcoin~~for ~~transaction~~their ~~fees~~contributions ~~have~~in ~~increased~~maintaining ~~from~~and ~~$0.35~~developing ~~per~~the Bitcoin ~~transaction,~~network ~~on average, to a high of $55~~protocol.16 ~~per~~A ~~transaction, on~~failure ~~average,~~to onproperly ~~December~~monitor ~~22,~~and ~~2017. As of December 2022, Bitcoin transaction fees stood around $1 per transaction, on average. Increased~~upgrade ~~fees~~the ~~and decreased settlement speeds could preclude certain uses for~~ Bitcoin ~~(e.g.,~~network ~~micropayments),~~protocol ~~and~~ could ~~reduce~~damage ~~demand for, and~~ the ~~price of,~~ Bitcoin, ~~which~~network ~~could~~and ~~adversely~~an ~~impact~~investment ~~the~~in ~~value of~~ the ~~Units~~Trust.

~~Many~~The Bitcoin network operates based on an open-source protocol maintained by the core developers ~~are~~and ~~actively~~other ~~researching~~contributors, largely on the GitHub ~~and~~resource ~~testing~~section ~~scalability~~dedicated ~~solutions~~to Bitcoin development. As Bitcoin is rewarded solely for ~~public~~mining ~~blockchains~~activity ~~that~~and dois not ~~necessarily~~sold ~~result~~to inraise ~~lower~~capital for ~~levels~~the ofBitcoin ~~security~~network, and the Bitcoin network protocol itself is made available for free rather than sold or ~~decentralization~~made available subject ~~(e.g.~~to licensing or subscription fees and its use does not generate revenues for its development team, ~~off-chain~~the ~~payment~~core ~~channels~~developers ~~like~~are generally not compensated for maintaining and updating the ~~Lightning~~source ~~Network,~~code ~~sharing~~for the Bitcoin network protocol. Consequently, there is a lack of financial incentive for developers to maintain or ~~off-chain~~develop ~~computations)~~the Bitcoin network and the core developers may lack the resources to adequately address emerging issues with the Bitcoin network protocol. ~~However~~Although the Bitcoin network is currently supported by the core developers, there can isbe no guarantee that ~~any~~such support will continue or be sufficient in the future. For example, there have been recent reports that the number of core developers who have the ~~mechanisms~~authority to make amendments to the Bitcoin network’s source code in ~~place~~the orGitHub ~~being~~repository is ~~explored~~relatively ~~for~~small, ~~increasing~~although there are believed to be a larger number of developers who contribute to the ~~scale~~overall development of ~~settlement~~the source code of the Bitcoin ~~Network~~network. ~~transactions will~~Alternatively, some developers may be ~~effective,~~funded orby ~~how~~entities ~~long~~whose ~~these~~interests ~~mechanisms~~are ~~will~~at ~~take~~odds towith ~~become~~other ~~effective~~participants in the Bitcoin network. In addition, ~~which~~a bad actor could ~~adversely~~also ~~impact~~attempt to interfere with the ~~value~~operation of the ~~Units~~Bitcoin network by attempting to exercise a malign influence over a core developer. To the extent that material issues arise with the Bitcoin network protocol and the core developers and open-source contributors are unable to address the issues adequately or in a timely manner, the Bitcoin network and an investment in the Trust may be adversely affected.

If a malicious actor or botnet obtains control of more than 50% of the processing power on the Bitcoin Network, or otherwise obtains control over the Bitcoin Network through its influence over core developers or otherwise, such actor or botnet could manipulate the Blockchain to adversely affect the value of the Units or the ability of the Trust to operate.34

~~If a malicious actor~~Digital orasset ~~botnet~~networks (aface ~~volunteer~~significant orscaling ~~hacked~~challenges ~~collection~~and ofefforts ~~computers controlled by networked software coordinating the actions of the computers) obtains a majority of the processing power dedicated~~ to ~~mining~~increase on the ~~Bitcoin~~volume ~~Network,~~and itspeed may be able to alter the Blockchain on which transactions in Bitcoin rely by constructing fraudulent blocks or preventing certain transactions from completing in a timely manner, or at all. The malicious actor or botnet could also control, exclude or modify the ordering of transactions. ~~Although~~may ~~the malicious actor or botnet would~~ not be ~~able to generate new tokens or transactions using such control, it could “double-spend” its own tokens (i~~successful.e., spend the same tokens in more than one transaction) and prevent the confirmation of other users’ transactions for so long as it maintained control. To the extent that such malicious actor or botnet did not yield its control of the processing power on the Bitcoin Network or the

Many digital asset networks, including the Bitcoin network, face significant scaling challenges due to the fact that public blockchains generally face a tradeoff between security and scalability. One means through which public blockchains achieve security is decentralization, meaning that no intermediary is responsible for securing and maintaining these systems. For example, a greater degree of decentralization generally means a given digital asset network is less susceptible to manipulation or capture. A digital asset network may be limited in the number of transactions it can process by the capabilities of each single fully participating node.

As corresponding increases in throughput lag behind growth in the use of digital asset networks, average fees and settlement times may increase considerably. For example, the Bitcoin network has been, at times, at capacity, which has led to increased transaction fees. Since January 1, 2025, Bitcoin transaction fees have decreased from $1.53 per Bitcoin transaction, on average, to $0.68 per transaction, on average, on December 31, 2025. Increased fees and decreased settlement speeds could preclude certain uses for Bitcoin (e.g., micropayments), and could reduce demand for, and the price of, Bitcoin, which could adversely impact the value of the Shares.

Many developers are actively researching and testing scalability solutions for public blockchains that do not necessarily result in lower levels of security or decentralization (e.g., off-chain payment channels like the Lightning Network, sharding, or off-chain computations). However, there is no guarantee that any of the mechanisms in place or being explored for increasing the scale of settlement of the Bitcoin network transactions will be effective, or how long these mechanisms will take to become effective, which could adversely impact the value of the Shares.

Digital assets may have concentrated ownership and large sales or distributions by holders of such digital assets could have an adverse effect on the market price of such digital assets.

The largest Bitcoin wallets are believed to hold, in aggregate, a significant percentage of the Bitcoin in circulation. Moreover, it is possible that other persons or entities control multiple wallets that collectively hold a significant number of Bitcoin, even if they individually only hold a small amount, and it is possible that some of these wallets are controlled by the same person or entity. As a result of this concentration of ownership, large sales or distributions by such holders could have an adverse effect on the market price of Bitcoin.

If the digital asset award for mining blocks and transaction fees for recording transactions on the Bitcoin network are not sufficiently high to incentivize miners, or if certain jurisdictions continue to limit mining activities, miners may cease expanding processing power or demand high transaction fees, which could negatively impact the value of Bitcoin and the value of the Shares.

If the digital asset awards for solving blocks and the transaction fees for recording transactions on the Bitcoin network are not sufficiently high to incentivize miners, miners may cease expending processing power to solve blocks and confirmations of transactions on the Bitcoin blockchain could be slowed. A reduction in the processing power expended by miners on the Bitcoin network could increase the likelihood of a malicious actor or botnet obtaining control.

Miners have historically accepted relatively low transaction confirmation fees on most digital asset networks. If miners demand higher transaction fees for recording transactions in the Blockchain or a software upgrade automatically charges fees for all transactions on the Bitcoin network, the cost of using Bitcoin may increase and the marketplace may be reluctant to accept Bitcoin as a means of payment. Alternatively, miners could collude in an anti-competitive manner to reject low transaction fees on the Bitcoin network and force users to pay higher fees, thus reducing the attractiveness of the Bitcoin network. Higher transaction confirmation fees resulting through collusion or otherwise may adversely affect the attractiveness of the Bitcoin network, the value of Bitcoin and the value of the Shares.

If a malicious actor or botnet obtains control of more than 50% of the processing power on the Bitcoin network, or otherwise obtains control over the Bitcoin network through its influence over core developers or otherwise, such actor or botnet could manipulate the Bitcoin blockchain to adversely affect the value of the Shares or the ability of the Trust to operate.

If a malicious actor or botnet (a volunteer or hacked collection of computers controlled by networked software coordinating the actions of the computers) obtains control of more than 50% of the processing power dedicated to mining on the Bitcoin network, it may be able to alter the Bitcoin blockchain on which transactions in Bitcoin rely by constructing fraudulent blocks or preventing certain transactions from completing in a timely manner, or at all. The malicious actor or botnet could also control, exclude or modify the ordering of transactions. Although the malicious actor or botnet would not be able to generate new tokens or transactions using such control, it could “double-spend” its own tokens (i.e., spend the same tokens in more than one transaction) and prevent the confirmation of other users’ transactions for so long as it maintained control. To the extent that such malicious actor or botnet did not yield its control of the processing power on the Bitcoin network or the Bitcoin community did not reject the fraudulent blocks as malicious, reversing any changes made to the Bitcoin blockchain may not be possible. Further, a malicious actor or botnet could create a flood of transactions in order to slow down the Bitcoin network.

Although there are no known reports of malicious activity on, or control of, the Bitcoin ~~community~~network, ~~did~~it ~~not~~is ~~reject~~believed that certain mining pools may have exceeded the ~~fraudulent~~50% ~~blocks~~threshold ason ~~malicious~~the Bitcoin network since the Bitcoin blockchain’s genesis block was mined in 2009, ~~reversing~~and ~~any~~others have ~~changes~~come close. The possible crossing or near-crossing of the 50% threshold indicates a greater risk that a single mining pool could ~~made~~exert toauthority over the ~~Blockchain~~validation of Bitcoin transactions, and this risk is heightened if over 50% of the processing power on the network falls within the jurisdiction of a single governmental authority. Also, there have been reports that two mining pools recently controlled in excess of 50% of the aggregate mining power on the Bitcoin network and may ~~not~~do beso ~~possible~~now or in the future. ~~Further~~If network participants, including the core developers and the administrators of mining pools, do not act to ensure greater decentralization of Bitcoin mining processing power, the feasibility of a malicious actor obtaining control of the processing power on the Bitcoin network will increase, which may adversely affect the value of the Shares. Also, if miners experience financial or ~~botnet~~other ~~could~~difficulties ~~create~~on a ~~flood~~large ofscale ~~transactions~~and inare ~~order~~unable to ~~slow~~participate ~~down~~in mining activities, whether due to a downturn in the Bitcoin ~~Network~~market or other factors, the risks of the Bitcoin network becoming more centralized could increase.

~~Although there are no~~A ~~known reports of~~ malicious ~~activity~~actor ~~on,~~may oralso obtain control ~~of,~~over the Bitcoin ~~Network,~~network itthrough isits ~~believed~~influence ~~that~~over ~~certain~~core ~~mining~~developers ~~pools~~by ~~may~~gaining ~~have~~direct ~~exceeded~~control ~~the~~over ~~50%~~a ~~threshold~~core ondeveloper ~~the~~or ~~Bitcoin~~an ~~Network.~~otherwise ~~The~~influential ~~possible~~programmer. ~~crossing~~To of the ~~50%~~extent ~~threshold indicates a greater risk~~ that ausers ~~single mining pool could exert authority over the validation of Bitcoin transactions,~~ and ~~this~~miners ~~risk~~accept isamendments ~~heightened~~to ~~if over 50% of~~ the ~~processing~~source code ~~power~~proposed onby the ~~network~~controlled ~~falls~~core ~~within the jurisdiction of a single governmental authority. If network participants~~developer, ~~including~~other ~~the~~ core developers ~~and~~do ~~the~~not ~~administrators~~counter ofsuch ~~mining pools~~amendments, doand ~~not~~such ~~act~~amendments toenable ~~ensure~~the ~~greater~~malicious exploitation ~~decentralization~~ of the Bitcoin ~~mining processing power~~network, the ~~feasibility~~risk ofthat a malicious actor ~~obtaining~~may ~~control~~be ofable ~~the~~to ~~processing~~obtain ~~power~~control onof the Bitcoin ~~Network~~network ~~will~~in ~~increase,~~this ~~which may~~manner ~~adversely affect the value of the Units~~exists.

A ~~malicious actor may~~ ~~also~~temporary ~~obtain control over the Bitcoin Network through its influence over core developers by gaining direct control over a core developer~~ or anpermanent ~~otherwise~~“fork” ~~influential~~could ~~programmer.~~adversely Toaffect the ~~extent~~value ~~that the Bitcoin ecosystem does not grow, the possibility that a malicious actor may be able obtain control~~ of the ~~processing power on the Bitcoin Network in this manner will remain heightened~~Shares.

AThe Bitcoin ~~temporary~~network oroperates ~~permanent~~using open-source protocols, meaning that any user can download the software, modify it and then propose that the users and miners of Bitcoin adopt the modification. When a modification is introduced and a substantial majority of users and miners consent to the modification, the change is implemented and the network remains uninterrupted. However, if less than a substantial majority of users and miners consent to the proposed modification, and the modification is not compatible with the software prior to its modification, the consequence would be what is known as a “hard fork” orof the Bitcoin network, with one group running the pre-modified software and the other running the modified software. The effect of such a fork would be the existence of two versions of Bitcoin running in parallel on separate networks using separate blockchain ledgers, yet lacking interchangeability. For example, in August 2017, Bitcoin “~~clone~~forked” into ~~could~~Bitcoin ~~adversely~~and ~~affect~~a new digital asset, Bitcoin Cash, as a result of a several-year dispute over how to increase the ~~value~~rate of transactions that the ~~Units~~Bitcoin network can process.

~~The Bitcoin Network~~Forks ~~operates~~may ~~using~~also ~~open-source~~occur ~~protocols,~~as ~~meaning~~a ~~that~~network ~~any~~community’s ~~user~~response ~~can~~to ~~download~~a ~~the~~significant ~~software,~~security ~~modify~~breach. itFor ~~and~~example, ~~then~~in ~~propose~~July ~~that~~2016, ~~the users~~Ethereum ~~and~~“forked” ~~miners~~into ofEthereum ~~Bitcoin~~and ~~adopt~~a ~~the~~new ~~modification.~~digital ~~When~~asset, aEthereum ~~modification~~Classic, isas ~~introduced and~~ a ~~substantial~~result ~~majority~~ of ~~users~~the ~~and~~Ethereum ~~miners~~network community’s ~~consent~~response to ~~the~~a ~~modification,~~significant ~~the~~security ~~change~~breach isin ~~implemented~~which ~~and~~an ~~the~~anonymous ~~network~~hacker ~~remains~~exploited ~~uninterrupted.~~a ~~However,~~smart ifcontract ~~less~~running ~~than~~on athe ~~substantial~~Ethereum network to ~~majority~~syphon ofapproximately ~~users~~$60 ~~and~~million ~~miners~~of ~~consent~~ETH toheld ~~the~~by ~~proposed~~The ~~modification~~DAO, ~~and~~a ~~the~~distributed ~~modification~~autonomous isorganization, ~~not~~into ~~compatible~~a ~~with~~segregated ~~the~~account. ~~software prior~~In response to ~~its~~the ~~modification~~hack, ~~the~~most ~~consequence~~participants ~~would~~in bethe ~~what~~Ethereum iscommunity ~~known~~elected asto adopt a “~~hard~~ fork” ofthat ~~the~~effectively ~~Bitcoin Network, with one group~~reversed ~~running~~ the ~~pre-modified software and the other running the modified software~~hack. ~~The~~However, ~~effect of such~~ a ~~fork~~minority ~~would be the existence~~ of ~~two~~users ~~versions~~continued ofto ~~Bitcoin~~develop ~~running~~the inoriginal ~~parallel~~blockchain, ~~yet~~with ~~lacking~~the ~~interchangeability. For example, in August 2017, Bitcoin forked into Bitcoin and a new~~ digital asset, ~~Bitcoin~~on ~~Cash,~~that asblockchain anow referred ~~result of a several-year dispute over how~~ to ~~increase~~as ~~the~~“Ethereum ~~rate~~Classic”. Ethereum ofClassic ~~transactions that~~now ~~the~~trades ~~Bitcoin~~on ~~Network~~several ~~can~~digital ~~process~~asset platforms. A fork may also occur as a result of an unintentional or unanticipated software flaw in the various versions of otherwise compatible software that users run. Such a fork could lead to users and miners abandoning the digital asset with the flawed software. It is possible, however, that a substantial number of users and miners could adopt an incompatible version of the digital asset while resisting community-led efforts to merge the two chains. This could result in a permanent fork, as in the case of Ethereum and Ethereum Classic.

~~Forks may also occur~~In ~~as a network community’s response to a significant security breach. For example~~addition, inmany ~~June~~developers ~~2016,~~have anpreviously ~~anonymous~~initiated ~~hacker~~hard ~~exploited a~~forks smart contract running on the Ethereum network to syphon approximately $60 million of ETH held by The DAO, a distributed autonomous organization, into a segregated account. In response to the hack, most participants in the ~~Ethereum~~Blockchain ~~community elected~~ to ~~adopt a~~launch ~~fork~~new ~~that~~digital ~~effectively reversed the hack. However~~assets, asuch ~~minority of users continued to develop the original blockchain, now referred to~~ as ~~“Ethereum~~Bitcoin ~~Classic”~~Gold ~~with the digital asset on that blockchain now referred to as Ether Classic, or ETC. ETC now~~and ~~trades~~Bitcoin ~~on several digital asset exchanges~~Diamond. ATo ~~fork may also occur as a result of an unintentional or unanticipated software flaw in~~ the ~~various~~extent ~~versions~~such ~~of otherwise compatible software that users run. Such a fork could lead to users and miners abandoning the~~ digital ~~asset~~assets compete with ~~the flawed software. It is possible~~Bitcoin, ~~however,~~such ~~that~~competition acould ~~substantial~~impact ~~number~~demand offor ~~users~~Bitcoin and ~~miners~~ could ~~adopt~~adversely animpact ~~incompatible~~the ~~version~~value of the ~~digital asset while resisting community-led efforts to merge the two chains~~Shares. ~~This could result in a permanent fork, as in the case of Ether and Ether Classic.~~

InFurthermore, a ~~addition~~hard fork can lead to new security concerns. For example, ~~many~~when ~~developers have~~the ~~previously~~Ethereum ~~initiated~~and ~~hard~~Ethereum ~~forks~~Classic networks split in ~~the~~July ~~Blockchain~~2016, replay attacks, in which transactions from one network were rebroadcast to ~~launch~~nefarious ~~new~~effect ~~digital~~on ~~assets~~the other network, ~~such~~plagued asEthereum ~~Bitcoin~~platforms through ~~Cash~~at least October 2016. An Ethereum platform announced in July 2016 that it had lost 40,000 ~~Bitcoin~~Ethereum ~~Gold~~Classic, ~~Bitcoin~~worth about $100,000 ~~Silver~~at ~~and~~that ~~Bitcoin~~time, ~~Diamond~~as a result of replay attacks. ToSimilar ~~the~~replay ~~extent~~attack ~~such~~concerns ~~digital~~occurred ~~assets~~in ~~compete~~connection with the Bitcoin, ~~such~~Cash ~~competition~~and ~~could~~Bitcoin Satoshi’s ~~impact~~Vision ~~demand~~networks ~~for~~split ~~Bitcoin~~in November 2018. Another possible result of a hard fork is an inherent decrease in the level of ~~and~~security ~~could~~due ~~adversely~~to ~~impact~~significant amounts of mining power remaining on one network or migrating instead to the ~~value~~new forked network. After a hard fork, it may become easier for an individual miner or mining pool’s hashing power to exceed 50% of the ~~Units~~processing power of a digital asset network that retained or attracted less mining power, thereby making digital asset networks that rely on proof-of-work more susceptible to attack.

Furthermore, a hard fork can lead to new security concerns. For example, when the Ethereum and Ethereum Classic networks split in July 2016, replay attacks, in which transactions from one network were rebroadcast to nefarious effect on the other network, plagued Ethereum exchanges through at least October 2016. An Ethereum exchange announced in July 2016 that it had lost 40,000 units of Ethereum Classic, worth about $100,000 at that time, as a result of replay attacks. Another possible result of a hard fork is an inherent decrease in the level of security due to significant amounts of mining power remaining on one network or migrating instead to the new forked network. After a hard fork, it may become easier for an individual miner or mining pool’s hashing power to exceed 50% of the processing power of the digital asset network that retained or attracted less mining power, thereby making digital assets that rely on proof-of-work more susceptible to attack.

Protocols may also be cloned. Unlike a fork, which modified an existing blockchain, and results in two competing networks, each with the same genesis block, a “clone” is a copy of a protocol’s codebase, but results in an entirely new blockchain and new genesis block. Tokens are created solely from the new “clone” network and, in contrast to forks, holders of tokens of the existing network that was cloned do not receive any tokens of the new network. A “clone” results in a competing network that has characteristics substantially similar to the network it was based on, subject to any changes as determined by the developer(s) that initiated the clone.

A future fork in or clone of the Bitcoin Network could adversely affect the value of the Units or the ability of the Trust to operate.

~~Unitholders~~A hard fork may ~~not~~adversely ~~receive~~affect the ~~benefits~~ price of ~~any~~Bitcoin ~~forks~~at the time of announcement or ~~“airdrops~~adoption.” For example, the announcement of a hard fork could lead to increased demand for the prefork digital asset, in anticipation that ownership of the prefork digital asset would entitle holders to a new digital asset following the fork. The increased demand for the prefork digital asset may cause the price of the digital asset to rise. After the hard fork, it is possible the aggregate price of the two versions of the digital asset running in parallel would be less than the price of the digital asset immediately prior to the fork. Furthermore, while the Sponsor will, as permitted by the terms of the Trust Agreement, determine which network is generally accepted as the Bitcoin network and should therefore be considered the appropriate network for the Trust’s purposes, there is no guarantee that the Sponsor will choose the network and the associated digital asset that is ultimately the most valuable fork. Either of these events could therefore adversely impact the value of the Shares.

InAs another ~~addition~~example toof the effects of hard forks~~, a~~ on digital ~~asset~~assets, ~~may~~on ~~become~~September ~~subject~~15, to2022, the Ethereum Network completed its merge, moving from a ~~similar~~proof-of-work ~~occurrence~~model ~~known~~to asa anproof-of-stake ~~“airdrop~~model.” InThe anEthereum ~~airdrop,~~proof-of-work miners who disagreed with the ~~promotors~~new ofconsensus amechanism ~~new~~forked ~~digital~~the ~~asset~~network ~~announce~~which toresulted ~~holders~~in the Ethereum proof-of-work ~~another~~network. ~~digital~~Ethereum ~~asset~~proof-of-work ~~that~~network ~~such~~was ~~holders~~driven ~~will~~by bea ~~entitled~~small but vocal group of miners who wished to ~~claim~~hold aonto ~~certain~~revenue ~~amount~~as Ethereum switched to proof-of-stake. The vast majority of token holder votes preferred the new ~~digital~~proof-of-stake ~~asset~~consensus ~~for~~method. ~~free,~~There ~~based~~was no material impact on the ~~fact~~Ethereum ~~that~~network ~~they~~as ~~hold~~a ~~such~~result ~~other~~of ~~digital~~the ~~asset~~fork. All ether holders were airdropped Ethereum proof-of-work network tokens as a result of the hard fork. However, not all liquidity providers were able to trade the new token and the Ethereum proof-of-work network token almost immediately lost most of its value.

~~Unitholders may not~~Protocols ~~receive the benefits of any forks, the Trust~~ may ~~not~~also ~~choose, or~~ be ~~able,~~cloned. toUnlike ~~participate in an airdrop, and the timing of receiving any benefits from~~ a fork, ~~airdrop~~which ormodifies ~~similar event is uncertain. We refer to the right to receive any such benefit as~~ an ~~“Incidental Right”~~existing ~~and any such virtual currency acquired through an Incidental Right as “Additional Currency.” There are likely to be operational~~blockchain, ~~tax, securities law, regulatory, legal~~ and ~~practical~~results ~~issues that significantly limit, or prevent entirely, Unitholders’ ability to realize a benefit, through their interests~~ in ~~the~~two ~~Trust,~~competing ~~from any such Additional Currency. For instance~~networks, ~~unless~~ ~~specifically~~each ~~announced,~~with the ~~Custodian~~same ~~does not support airdrops, metacoins, colored coins, side chains, or other derivative,~~genesis ~~enhanced~~block, ~~or forked protocols, tokens, or coins which supplement or interact with~~ a ~~digital~~“clone” ~~asset supported by the Custodian. In addition, the Sponsor may determine that there~~ is noa ~~safe~~copy orof ~~practical~~a ~~way to custody the Additional Currency, or that trying to do so may pose an unacceptable risk to the Trust~~protocol’s ~~holdings in Bitcoin~~codebase, orbut ~~that~~results ~~the~~in ~~costs~~an ofentirely ~~taking~~new ~~possession~~blockchain and~~/or~~ ~~maintaining ownership~~new ofgenesis ~~the Additional Currency exceed the benefits of owning the Additional Currency~~block. ~~Additionally, laws, regulation or other~~ ~~factors~~Tokens ~~may~~are ~~prevent~~created ~~Unitholders~~solely from ~~benefiting from~~ the

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