What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-08-13 compared with 2025-05-13 · 108 added, 71 removed, 126 unchanged (59% of the section changed)

38 unchanged sentences

to the Trust.

The Trust is an exchange-traded fund that issues units of beneficial interest representing fractional undivided beneficial

The Trust is an exchange-traded fund that issues common units of beneficial interest representing fractional undivided beneficial

interests in its net assets that trade on the Exchange.

12 unchanged sentences

These Seed Creation Baskets were redeemed for cash on or about January 19, 2024.

On June 2, 2025, the Trust

announced that the Sponsor had approved the Share Split of all of the Shares.

In connection with the Share Split, every one Share that

was held by the Trust’s Record Holders at the close of business on June 12, 2025, automatically split into three Shares after market

close on June 13, 2025.

The Share Split became effective at market open on June 16, 2025.

Following the Share Split, the Shares will continue

to trade under the ticker symbol “ARKB” under the same CUSIP, and the total NAV of the Trust did not change as a result of

the Share Split.

In addition, each Record Holder will continue to hold the same percentage of the Trust’s outstanding Shares as

held immediately prior to the Share Split, and the Share Split will not modify the rights or preferences of the Shares.

The investment

objective, strategy, and underlying holdings of the Trust will remain unchanged.

The Trust’s investment

objective is to seek to track the performance of bitcoin, as measured by the performance of the CME CF Bitcoin Reference Rate—New

York Variant, adjusted for the Trust’s expenses and other liabilities.

objective is to seek to track the performance of bitcoin, as measured by the performance of the Index, adjusted for the Trust’s

expenses and other liabilities.

CF Benchmarks Ltd.

is the administrator for the Index (the

“Index Provider”).

The Index is designed to reflect the performance of bitcoin in U.S.

In seeking to achieve its

investment objective, the Trust holds bitcoin at its Custodians and values its Shares daily based on the Index.

The Trust is a passive

investment vehicle and is not a leveraged product.

The Sponsor does not actively manage the bitcoin held by the Trust.

is the administrator for the Index Provider.

The Index is designed to reflect the performance

of bitcoin in U.S.

In seeking to achieve its investment objective, the Trust holds bitcoin at its Custodians and values its Shares

daily based on the Index.

The Trust is a passive investment vehicle and is not a leveraged product.

The Sponsor does not actively manage

the bitcoin held by the Trust.

The Trust issues Shares only

2 unchanged sentences

Individual Shares will

not be redeemed by the Trust but are listed and traded on the Exchange under the ticker symbol “ARKB”.

The Trust issues Shares

not be redeemed by the Trust but are listed and traded on the Exchange under the ticker symbol “ARKB.” The Trust issues Shares

in Creation Baskets on a continuous basis at the applicable NAV per Share on the creation order date.

The Trust pays the

unitary Sponsor Fee of 0.21% of the Trust’s bitcoin holdings.

The Sponsor Fee is paid by the Trust to the Sponsor as

compensation for services performed under the Trust Agreement.

The Sponsor agreed to waive the entire Sponsor Fee for (i) a

nine-month period which commenced on January 11, 2024 (the day the Trust’s Shares were initially listed on the Exchange), or

(ii) the first $1 billion of Trust assets, whichever came first.

The Trust assets exceeded $1 billion in April 2024, at which time

the waiver period ended.

The Trust incurred Sponsor Fees for the quarters ended March 31, 2025 and 2024 of $2,367,167 and $627,659 net of Sponsor Fee waived of

The Trust pays the unitary

Sponsor fee of 0.21% of the Trust’s bitcoin holdings.

The Sponsor fee is paid by the Trust to the Sponsor as compensation for services

performed under the Trust Agreement.

The Sponsor agreed to waive the entire Sponsor fee for (i) a nine-month period which commenced on

January 11, 2024 (the day the Trust’s Shares were initially listed on the Exchange), or (ii) the first $1 billion of Trust assets,

whichever came first.

The Trust assets exceeded $1 billion in February 2024, at which time the waiver period ended.

The Trust incurred

Sponsor fees for the six-month periods ended June 30, 2025 and 2024 of $4,811,499 and $2,183,009 net of Sponsor fees waived of $93,111,

respectively.

2 unchanged sentences

company reporting requirements.

The NAV of the Trust is

used by the Trust in its day-to-day operations to measure the net value of the Trust’s assets.

The NAV is calculated on each

Business Day and is equal to the aggregate value of the Trust’s assets less its liabilities based on the Index price.

determining the NAV of the Trust on any Business Day, the Administrator calculates the price of the bitcoin held by the Trust as of

ET on such day.

The Administrator also calculates the “NAV per Share” of the Trust, which equals the NAV of

the Trust divided by the number of outstanding Shares.

The NAV of the Trust is used

by the Trust in its day-to-day operations to measure the net value of the Trust’s assets.

The NAV is calculated on each Business

Day and is equal to the aggregate value of the Trust’s assets less its liabilities based on the Index price.

In determining the

NAV of the Trust on any Business Day, the Administrator calculates the price of the bitcoin held by the Trust as of 4:00 p.m.

The Administrator also calculates the “NAV per Share” of the Trust, which equals the NAV of the Trust divided by the

number of outstanding Shares.

In addition to calculating

39 unchanged sentences

except price of bitcoin and Shares outstanding)

As of March 31, 2025, the

Trust had a net closing balance of 47,501.0671 bitcoin with a value of $3,941,769, based on the Index Price of $82,982.75 on March 31,

2025 (CME CF Bitcoin Reference Rate – New York Variant).

As of March 31, 2025, the total market value of the Trust’s bitcoin was

$3,916,212, based on the price of a bitcoin in the principal market (Coinbase) of $82,444.71 on March 31, 2025.

For the three months ended March 31, 2025

As of June 30, 2025, the Trust

had a net closing balance of 46,722.8267 bitcoins with a value of $5,022,119, based on the Index price of $107,487.49 on June 30, 2025

(CME CF Bitcoin Reference Rate – New York Variant, non-GAAP methodology).

As of June 30, 2025, the total market value of the Trust’s

bitcoin was $5,034,561, based on the price of a bitcoin in the principal market of $107,753.77 on June 30, 2025.

For the Three Months ended on June 30, 2025

Net realized and change in

unrealized loss on investment in bitcoin for the period December 31, 2024 through March 31, 2025, was $(585,181) which includes a net

change in unrealized depreciation on investment in bitcoin of $(907,296).

Net realized and unrealized gain on investment in bitcoin for

the period was driven by bitcoin price depreciation throughout the period from $93,390.22 per bitcoin as of December 31, 2024, to $82,444.71

per bitcoin as of March 31, 2025.

Net decrease in net assets resulting from operations was $(587,548) for the period ended March 31,

2025, primarily driven by the aforementioned net realized and change in unrealized loss

on investment in bitcoin despite the net increase in the number of shares outstanding.

For the three months ended March 31, 2024

Net realized and unrealized gain on investment

in bitcoin for the three months ended March 31, 2024, was $845,238 which includes a realized loss of $(85) on the sale of bitcoins associated

with the disposition of the initial seed creation shares, a loss for the removal of bitcoin mark-to-market from the daily Sponsor’s Fee

accrual, and a net change in unrealized appreciation on investment in bitcoin of $845,323.

Net realized and unrealized gain on investment

in bitcoin for the period was driven by bitcoin price appreciation from $46,666.89 per bitcoin as of January 11, 2024, to $70,761.62 per

bitcoin as of March 31, 2024.

Net increase in net assets resulting from operations was $844,610 for the three months ended March 31, 2024,

which consisted of the net realized and unrealized gain on investment in bitcoin, less the Sponsor’s Fee of $628.

unrealized loss on investment in bitcoin for the three months ended June 30, 2025, was $1,200,104 which includes a net change in unrealized

appreciation on investment in bitcoin of $859,932.

Net realized and change in unrealized gain on investment in bitcoin for the period

was driven by bitcoin price appreciation throughout the period from $82,444.71 per bitcoin as of March 31, 2025 to $107,753.77 per bitcoin

as of June 30, 2025.

Net increase in net assets resulting from operations was $1,197,660 for the three months ended June 30, 2025, primarily

driven by the aforementioned net realized and change in unrealized gain on investment in bitcoin.

For the Three Months ended on June 30, 2024

The Trust’s NAV decreased

from $3,160,033 on March 31, 2024 to $2,849,575 on June 30, 2024.

The decrease in the Trust’s NAV resulted primarily from a decrease

in bitcoin price of 12.48% (from $70,761.62 per bitcoin as of March 31, 2024 to $61,929.29 per bitcoin as of June 30, 2024) and an increase

of number of shares outstanding from 134,010,000 on March 31 2024 to 139,500,000 on June 30, 2024.

The Trust’s net decrease

in net assets resulting from operations for the quarter ended June 30, 2024 was $(409,214).

This number is largely the result of a change

in unrealized depreciation on investment in bitcoin of $(543,311), which was partially offset by a realized gain of $327 on the sale of

bitcoin for purposes of distributing to the Sponsor as the Sponsor’s fee and net realized gain on investment in bitcoin sold for

redemptions of $135,325.

The Trust’s expenses for the quarter were $1,555, relating to the Sponsor’s fees.

For the Six Months Ended June 30, 2025

The Trust’s NAV increased

from $4,352,288 on December 31, 2024 to $5,034,361 on June 30, 2025.

The increase in the Trust’s NAV resulted primarily from an

increase in the price of bitcoin of 15.46% (from $93,320.22 per bitcoin on December 31, 2024 to $107,753.77 per bitcoin on June 30, 2025)

and a net increase of 93,880,000 in the number of shares outstanding from December 31, 2024 to June 30, 2025.

The Trust’s net increase

in net assets resulting from operations for the six months ended June 30, 2025 was $610,112.

This was the result of a change in unrealized

depreciation on investment in bitcoin of $(47,364), a net realized gain of $1,129 on the sale of bitcoins for purposes of distributing

to the Sponsor as the Sponsor’s fee, and net realized gain on investment in bitcoin sold for redemptions of $661,158.

expenses for the six-month period were $(4,811) relating to the Sponsor’s fees.

For the Six Months Ended June 30, 2024

The Trust’s NAV increased

from $100 on December 31, 2023 to $2,849,575 on June 30, 2024.

The increase in the Trust’s NAV resulted primarily from an increase

in the price of bitcoin of 32.70% (from $46,666.89 per bitcoin on January 11, 2024 to $61,929.29 per bitcoin on June 30, 2024) and a net

increase of 138,149,994 in the number of shares outstanding from December 31, 2023 to June 30, 2024.

The Trust’s net increase

in net assets resulting from operations for the six months ended June 30, 2024 was $435,396.

This was the result of a change in unrealized

depreciation on investment in bitcoin of $302,012, a net realized gain of $327 on the sale of bitcoins for purposes of distributing to

the Sponsor as the Sponsor’s fee, and net realized gain on investment in bitcoin sold for redemptions of $135,239.

expenses for the six-month period were $2,183, relating to the Sponsor’s fees net of Sponsor’s fee waived.

Liquidity and Capital Resources

The Trust is not aware of any trends, demands,

commitments, events, or uncertainties that are reasonably likely to result in material changes to its liquidity needs.

The Trust’s only

ordinary recurring expense is the fee paid to the Sponsor at an annual rate of 0.21% of the daily net asset value of the Trust.

agreed to waive the entire Sponsor Fee for (i) a nine-month period which commenced on January 11, 2024 (the day the Trust’s Shares were

initially listed on the Exchange), or (ii) the first $1 billion of Trust assets, whichever came first.

The Trust assets exceeded $1 billion

in April 2024, at which time the waiver period ended.

The aggregate Sponsor Fee paid to the Sponsor for the period ended March 31, 2025

was $(2,585,000).

In exchange for the Sponsor’s fee, the Sponsor has agreed to assume the ordinary fees and expenses incurred by the Trust,

including but not limited to the following:

fees charged by the Sub-Adviser, Administrator, the Custodians, Transfer Agent and the Trustee,

the Marketing Fee, the Exchange’s listing fees, typical maintenance and transaction fees of the DTC, SEC registration fees, printing and

mailing costs, website fees, tax reporting fees, audit fees, license fees and expenses, up to $100,000 per annum in ordinary legal fees

and expenses.

The Trust is not aware of

any trends, demands, commitments, events, or uncertainties that are reasonably likely to result in material changes to its liquidity needs.

The Trust’s only ordinary recurring expense is the fee paid to the Sponsor at an annual rate of 0.21% of the daily NAV of the Trust.

The Sponsor agreed to waive the entire Sponsor fee for (i) a nine-month period which commenced on January 11, 2024 (the day the Trust’s

Shares were initially listed on the Exchange), or (ii) the first $1 billion of Trust assets, whichever came first.

The Trust assets exceeded

$1 billion in February 2024, at which time the waiver period ended.

The aggregate Sponsor fee paid to the Sponsor for the period ended

June 30, 2025 was $4,969.

In exchange for the Sponsor’s fee, the Sponsor has agreed to assume the ordinary fees and expenses incurred

by the Trust, including but not limited to the following:

fees charged by the Sub-Adviser, Administrator, the Custodians, Transfer Agent

and the Trustee, the Marketing Fee, the Exchange’s listing fees, typical maintenance and transaction fees of the DTC, SEC registration

fees, printing and mailing costs, website fees, tax reporting fees, audit fees, license fees and expenses, up to $100,000 per annum in

ordinary legal fees and expenses.

The Sponsor bears expenses in connection with the Trust’s organization and initial offering costs.

18 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis