What changed in this filing

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Item 1. Business

2026-03-02 compared with 2025-03-26 · 282 added, 211 removed, 399 unchanged (55% of the section changed)

DESCRIPTION OF THE TRUST

The Trust is an exchange-traded

fund that issues common shares of beneficial interest (the “Shares”) that trade on the Cboe BZX Exchange, Inc.

(the “Exchange”)

under the symbol “ARKB.” 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 (the “Index”), adjusted for the Trust’s expenses

and other liabilities.

In seeking to achieve its investment objective, the Trust holds bitcoin and values its Shares daily based on the

The Sponsor is the sponsor of the Trust and Delaware Trust Company (the “Trustee”) is the trustee of the Trust.

Bank of New York Mellon (“BNYM”) serves as the Trust’s Administrator, Transfer Agent, and the Cash Custodian.

Custody Trust Company, LLC (“Coinbase Custodian”), BitGo New York Trust Company, LLC (“BitGo”), and Anchorage

Digital Bank N.A (“Anchorage”, and, together with Coinbase Custodian and BitGo, as the context may require, the “Bitcoin

The Trust is an exchange-traded fund that issues common shares of beneficial

interest (the “Shares”) that trade on the Cboe BZX Exchange, Inc.

(the “Exchange”) under the symbol “ARKB.”

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 (the “Index”), adjusted for the Trust’s expenses and other liabilities.

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

The Sponsor is the sponsor

of the Trust and CSC Delaware Trust Company (the “Trustee”) is the trustee of the Trust.

The Bank of New York Mellon serves

as the Trust’s Administrator, Transfer Agent, and the Cash Custodian.

Coinbase Custody Trust Company, LLC (“Coinbase Custodian”),

BitGo Bank & Trust, N.A.

(“BitGo”), Anchorage Digital Bank N.A (“Anchorage”) and BitGo New York Trust Company,

LLC (“BitGo New York”, and, together with Coinbase Custodian, BitGo and Anchorage, as the context may require, the “Bitcoin

Custodians” and each a “Bitcoin Custodian”), are the Bitcoin Custodians for the Trust and hold all the Trust’s

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trading advisor under the CEA in connection with the shares.

The Sponsor is not registered with the SEC as an investment adviser and is

The Sponsor is not registered with the Securities and Exchange Commission (the “SEC”) as an investment adviser and is

not subject to regulation by the SEC as such in connection with its activities with respect to the Trust.

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Additional information regarding the Trust may also be found on the SEC’s EDGAR database at www.sec.gov.

The Trust is a Delaware statutory

trust, formed on June 22, 2021, pursuant to the Delaware Statutory Trust Act (“DSTA”).

The Trust continuously issues Shares

that may be purchased and sold on the Exchange.

The Trust is a Delaware statutory trust, formed on June 22, 2021, pursuant

to the Delaware Statutory Trust Act (“DSTA”).

The Trust continuously issues Shares that may be purchased and sold on the Exchange.

The Trust operates pursuant to the Trust Agreement.

Delaware Trust Company, a Delaware

trust company, is the Delaware trustee of the Trust.

CSC Delaware Trust Company, a Delaware trust company, is the Delaware trustee of the

The Trust is managed and controlled by the Sponsor.

The Sponsor is a limited liability

company formed in the state of Delaware on June 16, 2021.

The Sponsor is a limited liability company formed in the state of Delaware

on June 16, 2021.

Shares are issued and redeemed

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DESCRIPTION OF THE SHARES

Each Share represents a fractional

undivided beneficial interest in the net assets of the Trust.

Upon redemption of the Shares, the applicable Authorized Participant is

paid solely out of the funds and property of the Trust.

The assets of the Trust consist primarily of bitcoin held by the Bitcoin Custodians

on behalf of the Trust and cash.

Creation Baskets are redeemed by the Trust in exchange for an amount of cash equal to the amount of bitcoin

represented by the aggregate number of Shares redeemed.

Each Share represents a

fractional undivided beneficial interest in the net assets of the Trust.

Upon redemption of the Shares, the applicable Authorized

Participant is paid solely out of the funds and property of the Trust.

The assets of the Trust consist primarily of bitcoin held by

the Bitcoin Custodians on behalf of the Trust and cash.

Creation Baskets are redeemed by the Trust in exchange for an amount of cash

or an amount of bitcoin equal to the amount of bitcoin represented by the aggregate number of Shares redeemed.

The Trust is a passive investment

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Market and Fair Value Determination of bitcoin

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 day other than a day when the

Exchange is closed for regular trading (a “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 will calculate

the price of the bitcoin held by the Trust as of 4:00 p.m.

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 day other

than a day when the Exchange is closed for regular trading (a “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 will

calculate the price of the bitcoin held by the Trust as of 4:00 p.m.

ET on such day.

The Administrator will also calculate the “NAV per Share”

of the Trust, which equals the NAV of the Trust divided by the number of outstanding Shares.

The Administrator will also calculate 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

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whichever came first.

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

Except for during periods

during which the Sponsor Fee has been waived, the Sponsor Fee accrues daily and is payable in bitcoin weekly in arrears.

The aggregate

Sponsor Fee paid to the Sponsor for the fiscal year ended December 31, 2024 was $5,732,049.

The Administrator calculates the Sponsor Fee

on a daily basis by applying a 0.21% annualized rate to the Trust’s total bitcoin holdings, and the amount of bitcoin payable in

respect of each daily accrual is determined by reference to the Index.

The Sponsor has agreed to pay all operating expenses (except for

litigation expenses and other extraordinary expenses) out of the Sponsor Fee.

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

Except for during periods during which the Sponsor Fee has been waived,

the Sponsor Fee accrues daily and is payable in bitcoin weekly in arrears.

The Trust incurred Sponsor Fees for the fiscal years ended

December 31, 2025 and 2024 of $9,767,516 and $5,832,114 (net of sponsor fee waived), respectively.

The Administrator calculates the Sponsor

Fee on a daily basis by applying a 0.21% annualized rate to the Trust’s total bitcoin holdings, and the amount of bitcoin payable

in respect of each daily accrual is determined by reference to the Index.

The Sponsor has agreed to pay all operating expenses (except

for litigation expenses and other extraordinary expenses) out of the Sponsor Fee.

As partial consideration for

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and Redemption of Shares

The Trust creates and redeems

Shares from time to time, but only in one or more Baskets (other than in the case of the Seed Creation Baskets) consisting of 5,000 Shares

or multiples thereof.

Baskets are only made in exchange for delivery to the Trust or the distribution by the Trust of the amount of cash

equivalent to the amount of bitcoin represented by the Baskets being created or redeemed, the amount of which is based on the quantity

of bitcoin attributable to each Share of the Trust (net of accrued but unpaid Sponsor Fees and any accrued but unpaid extraordinary expenses

or liabilities) being created or redeemed determined as of 4:00 p.m.

ET on the day the order to create or redeem Baskets is properly received.

Authorized Participants are

the only persons that may place orders to create and redeem Baskets.

Authorized Participants must be (1) registered broker-dealers or

other securities market participants, such as banks and other financial institutions, which are not required to register as broker-dealers

to engage in securities transactions described below, and (2) DTC Participants.

To become an Authorized Participant, a person must enter

into an Authorized Participant Agreement with the Sponsor.

The Authorized Participant Agreement provides the procedures for the creation

and redemption of Baskets and for the delivery of the bitcoin required for such creation and redemptions.

The Authorized Participant Agreement

and the related procedures attached thereto may be amended by the Trust, without the consent of any Shareholder or Authorized Participant.

Authorized Participants pay the Transfer Agent a fee for each order they place to create or redeem one or more Baskets.

The transaction

fee may be reduced, increased, or otherwise changed by the Sponsor.

Authorized Participants will

deliver only cash to create shares and will receive only cash when redeeming Shares.

Further, Authorized Participants will not directly

or indirectly purchase, hold, deliver, or receive bitcoin as part of the creation or redemption process or otherwise direct the Trust

or a Bitcoin Counterparty (defined below) with respect to purchasing, holding, delivering, or receiving bitcoin as part of the creation

or redemption process.

A “Bitcoin Counterparty” is a designated third party, who is not an Authorized Participant but who

may be an affiliate of an Authorized Participant, or the Prime Broker or Lender, as applicable, with whom the Sponsor has entered into

an agreement on behalf of the Trust, that will, acting as a counterparty, deliver, receive or convert to U.S.

dollars the bitcoin related

to the Authorized Participant’s creation or redemption order.

The Trust creates Shares by

receiving bitcoin from a Bitcoin Counterparty that is not the Authorized Participant, and the Trust—not the Authorized Participant—is

responsible for selecting the Bitcoin Counterparty to deliver the bitcoin.

Further, the Bitcoin Counterparty does not act as an agent

of the Authorized Participant with respect to the delivery of the bitcoin to the Trust or act at the direction of the Authorized Participant

with respect to the delivery of the bitcoin to the Trust.

The Trust redeems Shares by

delivering bitcoin to a Bitcoin Counterparty that is not the Authorized Participant and the Trust—not the Authorized Participant

—is responsible for selecting the Bitcoin Counterparty to receive the bitcoin.

Further, the Bitcoin Counterparty does not act as

an agent of the Authorized Participant with respect to the receipt of the bitcoin from the Trust or act at the direction of the Authorized

Participant with respect to the receipt of the bitcoin from the Trust.

Bitcoin Counterparties deliver

bitcoin related to the Authorized Participant’s purchase order to the Cold Vault Balance.

Authorized Participants and Bitcoin Counterparties

are not required to maintain an account with any of the Bitcoin Custodians.

Creations and redemptions

of Shares may result in certain slippage being incurred as a result of, for example, trading fees, spreads, or commissions.

so incurred will be the responsibility of the Authorized Participant, as a cash liability, and not of the Trust or Sponsor.

Each Authorized Participant

is required to be registered as a broker-dealer under the Exchange Act and a member in good standing with FINRA or exempt from being or

otherwise not required to be licensed as a broker-dealer or a member of FINRA and be qualified to act as a broker or dealer in the states

or other jurisdictions where the nature of its business so requires.

Certain Authorized Participants may also be regulated under federal

and state banking laws and regulations.

Each Authorized Participant has its own set of rules and procedures, internal controls, and information

barriers as it determines is appropriate considering its own regulatory regime.

Trust creates and redeems Shares on a continuous basis but only in one or more Baskets (other than in the case of the Initial Seed Shares)

consisting of 5,000 Shares or multiples thereof on the NAV of the date of the creation or redemption.

Only “Authorized Participants”,

which are registered broker-dealers who have entered into written agreements with the Sponsor and the Administrator, can place orders.

Participants may purchase Shares in cash by depositing cash in the Trust’s account with the Cash Custodian.

This will cause the

Sponsor, on behalf of the Trust, to automatically instruct a designated third party, who may be an Authorized Participant or an affiliate

of an Authorized Participant, and with whom the Sponsor has entered into an agreement on behalf of the Trust (each such third party,

a “Bitcoin Counterparty”), to (i) purchase the amount of bitcoin equivalent in value to the cash deposit amount associated

with the order and (ii) deposit the resulting bitcoin amount in the Trust’s accounts with the Bitcoin Custodians, resulting in

the Transfer Agent crediting the applicable amount of Shares to the Authorized Participant.

Authorized Participants may also purchase

Shares in-kind.

To purchase Shares in-kind, an Authorized Participant delivers, or arranges for the delivery by the Authorized Participant’s

designee of, bitcoin to the Trust’s accounts with a Bitcoin Custodian in exchange for Shares.

When such an Authorized Participant redeems its Shares in cash, the

Sponsor, on behalf of the Trust will direct a Bitcoin Custodian to transfer bitcoin to a Bitcoin Counterparty, who will sell the bitcoin

to be executed, in the Sponsor’s reasonable efforts, at the Pricing Benchmark price used to calculate the Trust’s NAV, taking

into account any spread, commissions, or other trading costs and deposit the cash proceeds of such sale in the Trust’s account with

the Cash Custodian for settlement with the Authorized Participant.

Any slippage incurred (including, but not limited to, any trading fees,

spreads, or commissions), on a cash equivalent basis, will be the responsibility of the Authorized Participant and not of the Trust or

Authorized Participants may also redeem Shares in-kind.

When such an Authorized Participant redeems Shares in-kind, the Trust,

through a Bitcoin Custodian, will deliver bitcoin to the Authorized Participant, or its designee in exchange for Shares.

On December 16, 2025, the Trust entered into a new authorized participant

agreement (the “Macquarie Authorized Participant Agreement”) with Macquarie Capital (USA) Inc.

(“Macquarie”),

pursuant to which Macquarie has agreed to act as an authorized participant of the Trust.

The Macquarie Authorized Participant Agreement

provides the procedures for the creation and redemption of blocks of 5,000 shares (“Baskets”) and for the delivery of the

bitcoin required for such creation and redemption.

The Macquarie Authorized Participant Agreement differs from the Trust’s agreements

with other authorized participants in that it allows for in-kind creation and redemption orders.

In connection with each order by Macquarie

to create or redeem one or more Baskets, unless waived by the Sponsor, the Sponsor shall charge a transaction fee.

The Macquarie

Authorized Participant Agreement may be amended as mutually agreed by the parties, without the consent of any Shareholder.

The procedures

governing the order entry system may be amended by the Trust without the consent of Macquarie or any Shareholder.

The Macquarie Authorized

Participant Agreement requires the Trust to indemnify Macquarie and certain of its affiliates in certain situations, including against

certain losses arising or related to untrue or alleged untrue statements of material fact under the Registration Statement and Prospectus

(as defined therein), breach of the Macquarie Authorized Participant Agreement or violation of applicable law.

The Macquarie Authorized

Participant Agreement continues indefinitely, unless earlier terminated in accordance with its terms.

Providers of the Trust

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extraordinary expenses) out of the Sponsor’s unified fee.

The Sponsor is a wholly owned

subsidiary of 21co Holdings Limited (formerly known as Amun Holdings Limited).

At present, the primary business activities of 21co Holdings

Limited are providing exchange traded products and tokenization services in the crypto space through its subsidiaries.

21Shares AG, an affiliate

of the Sponsor, has considerable experience issuing and operating exchange-traded products that provide exposure to digital assets, operating

such exchange-traded products since 2018.

As of December 31, 2024, 21Shares AG oversees approximately $4.9 billion in assets under management

and nearly 47 digital asset-related exchange-traded products across various jurisdictions.

Although the Sponsor is a relatively new entity

within the broader structure of 21Shares AG and its affiliates (collectively, the “21Shares Group”), the Sponsor utilizes

a similar management team that the 21Shares Group has used in issuing and operating these exchange-traded products.

Additionally, as of

December 31, 2024, the Sponsor serves as sub-adviser to five investment companies registered under the 1940 Act.

The Sponsor is a wholly owned subsidiary of 21co Holdings Limited (formerly

known as Amun Holdings Limited).

The ultimate parent company of 21co Holdings Limited is FalconX Holdings Limited (“FalconX”).

At present, the primary business activities of 21co Holdings Limited and FalconX are, with respect to 21co Holdings Limited, providing

exchange traded products and technology services in the digital asset space through its subsidiaries and, with respect to FalconX, providing

comprehensive access to global digital asset liquidity and a full range of trading services (including through its affiliates).

21Shares AG, an affiliate of the Sponsor, has considerable experience

issuing and operating exchange-traded products that provide exposure to digital assets, operating such exchange-traded products since

As of December 31, 2025, 21Shares AG oversees approximately $3.66 billion in assets under management and 57 digital asset-related

exchange-traded products across various jurisdictions.

Although the Sponsor is a relatively new entity within the broader structure of

21Shares AG and its affiliates (collectively, the “21Shares Group”), the Sponsor utilizes a similar management team that the

21Shares Group has used in issuing and operating these exchange-traded products.

Since June 2021, September 2023, June 2024, June 2024,

April 2025, and January 2025 the Sponsor has served as sponsor to the Trust, 21Shares Ethereum ETF, 21Shares Solana ETF, 21Shares XRP

ETF, 21Shares Dogecoin ETF, and 21Shares Sui ETF, each an exchange-traded product registered under the Securities Act and which provide

exposure to spot bitcoin, spot Ethereum, spot Solana, spot XRP, spot Dogecoin and spot Sui, respectively, and which trade on national

securities exchanges under the symbols “ARKB,” “TETH,” “TSOL,” “TOXR,” “TDOG”

and “TSUI” respectively.

The Sponsor also serves as sponsor to the following entities:

(i) 21Shares Polkadot ETF, a Delaware

statutory trust that filed a registration statement on Form S-1 with the SEC on January 31, 2025;

(ii) 21Shares Ondo ETF, a Delaware statutory

trust that filed a registration statement on Form S-1 with the SEC on July 22, 2025;

(iii) 21Shares Sei ETF, a Delaware statutory trust

that filed a registration statement on Form S-1 with the SEC on August 28, 2025;

(iv) 21Shares Injective ETF, a Delaware statutory trust

that filed a registration statement on Form S-1 with the SEC on October 20, 2025;

and (v) 21Shares Hyperliquid ETF, a Delaware statutory

trust that filed a registration statement on Form S-1 with the SEC on October 29, 2025.

If any of these products are subsequently declared

effective by the SEC, they each expect to become exchange-traded products registered under the Securities Act that will provide exposure

to spot digital assets and will trade on an exchange.

Additionally, since November 2025, the Sponsor serves as sub-adviser to four investment

companies registered under the 1940 Act.

The Sponsor is not under any

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the Sponsor Indemnified Parties will survive the termination of the Trust Agreement.

ARK Investment Management

LLC, serves as the Trust’s sub-adviser.

ARK Investment Management LLC, serves as the Trust’s sub-adviser.

The Sub-Adviser provides data, research, and, as needed, operational support to the Trust.

As of December 31, 2024, the Sub-Adviser had approximately $29.36 billion in assets under management.

The Trust is passively managed and

does not pursue active management investment strategies, and the Sponsor and the Sub-Adviser do not actively manage the bitcoin held by

This means that the Sponsor and the Sub-Adviser do not sell bitcoin at times when its price is high or acquire bitcoin at low

prices in the expectation of future price increases.

It also means that the Sponsor and the Sub-Adviser do not make use of any of the

hedging techniques available to professional bitcoin investors to attempt to reduce the risks of losses resulting from price decreases.

The Sponsor entered into the Support Services Agreement with the Sub-Adviser and pays the Sub-Adviser out of the unitary fee it receives

from the Trust.

As of December 31, 2025, the Sub-Adviser had

approximately $29.69 billion in assets under management.

The Trust is passively managed and does not pursue active management investment

strategies, and the Sponsor and the Sub-Adviser do not actively manage the bitcoin held by the Trust.

This means that the Sponsor and

the Sub-Adviser do not sell bitcoin at times when its price is high or acquire bitcoin at low prices in the expectation of future price

It also means that the Sponsor and the Sub-Adviser do not make use of any of the hedging techniques available to professional

bitcoin investors to attempt to reduce the risks of losses resulting from price decreases.

The Sponsor entered into the Support Services

Agreement with the Sub-Adviser and pays the Sub-Adviser out of the unitary fee it receives from the Trust.

The Trust does not directly

pay the Sub-Adviser.

Delaware Trust Company, a

Delaware trust company, acts as the trustee of the Trust for the purpose of creating a Delaware statutory trust in accordance with the

The Trustee is appointed to serve as the trustee of the Trust in the State of Delaware for the sole purpose of satisfying the requirement

of Section 3807(a) of the DSTA that the Trust have at least one trustee with a principal place of business in the State of Delaware.

CSC Delaware Trust Company, a Delaware trust company, acts as the trustee of the Trust for the purpose of creating

a Delaware statutory trust in accordance with the DSTA.

The Trustee is appointed to serve as the trustee of the Trust in the State of

Delaware for the sole purpose of satisfying the requirement of Section 3807(a) of the DSTA that the Trust have at least one trustee with

a principal place of business in the State of Delaware.

As further discussed in the

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bitcoin custodianS

Coinbase, BitGo and Anchorage

are the Bitcoin Custodians for the Trust and hold all of the Trust’s bitcoin on the Trust’s behalf.

The Bitcoin Custodians keep

custody of all the Trust’s bitcoin, other than which is maintained in the Trading Balance with the Prime Broker, in the Cold Vault

The Bitcoin Custodians keeps a substantial portion of the private keys associated with the Trust’s bitcoin in “cold

storage” or similarly secure technology.

Cold storage is a safeguarding method with multiple layers of protections and protocols,

by which the private key(s) corresponding to the Trust’s bitcoin is (are) generated and stored in an offline manner.

are generated in offline computers that are not connected to the internet so that they are resistant to being hacked.

By contrast, in

hot storage, the private keys are held online, where they are more accessible, leading to more efficient transfers, though they are potentially

more vulnerable to being hacked.

While the Bitcoin Custodians will generally keep a substantial portion of the Trust’s bitcoin in

cold storage on an ongoing basis, it is possible that, from time to time, portions of the Trust’s bitcoin will be held outside of

cold storage temporarily in the Trading Balance maintained by the Prime Broker as part of trade facilitation in connection with creations

and redemptions of Baskets, to sell bitcoin including to pay Trust expenses, or to pay the Sponsor Fee, as necessary.

bitcoin held in the Cold Vault Balance by the Bitcoin Custodians are held in segregated wallets and therefore are not commingled with

the Bitcoin Custodians’ or other customer assets.

Coinbase, BitGo, Anchorage and BitGo New York are the Bitcoin Custodians

for the Trust and hold all of the Trust’s bitcoin on the Trust’s behalf.

The Bitcoin Custodians keep custody of all the Trust’s bitcoin,

other than which is maintained in the Trading Balance with the Prime Broker, in the Cold Vault Balance.

The Bitcoin Custodians keeps a

substantial portion of the private keys associated with the Trust’s bitcoin in “cold storage” or similarly secure technology.

Cold storage is a safeguarding method with multiple layers of protections and protocols, by which the private key(s) corresponding to

the Trust’s bitcoin is (are) generated and stored in an offline manner.

Private keys are generated in offline computers that are

not connected to the internet so that they are resistant to being hacked.

By contrast, in hot storage, the private keys are held online,

where they are more accessible, leading to more efficient transfers, though they are potentially more vulnerable to being hacked.

the Bitcoin Custodians will generally keep a substantial portion of the Trust’s bitcoin in cold storage on an ongoing basis, it

is possible that, from time to time, portions of the Trust’s bitcoin will be held outside of cold storage temporarily in the Trading

Balance maintained by the Prime Broker as part of trade facilitation in connection with creations and redemptions of Baskets, to sell

bitcoin including to pay Trust expenses, or to pay the Sponsor Fee, as necessary.

The Trust’s bitcoin held in the Cold Vault Balance

by the Bitcoin Custodians are held in segregated wallets and therefore are not commingled with the Bitcoin Custodians’ assets or

the assets of each such Bitcoin Custodian’s other customers.

Cold storage of private keys

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internal audit team performs periodic internal audits over custody operations, and the Bitcoin Custodians have represented that Systems

and Organizational Control (“SOC”) attestations covering private key management controls are also performed on the Bitcoin

and Organizational Control attestations covering private key management controls are also performed on the Bitcoin

Custodians by an external provider.

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utilize leverage, derivatives, or any similar arrangements in seeking to meet its investment objective.

In the event of a fork, the

Custodial Services Agreement provides that the Bitcoin Custodians may temporarily suspend services, and may, in their sole discretion,

determine whether or not to support (or cease supporting) either branch of the forked protocol entirely, provided that the Bitcoin Custodians

shall use commercially reasonable efforts to avoid ceasing to support both branches of such forked protocol and will support, at a minimum,

the original digital asset.

The Custodial Services Agreement provides that, other than as set forth therein, and provided that the Bitcoin

Custodians shall make commercially reasonable efforts to assist the Trust to retrieve and/or obtain any assets related to a fork, airdrop

or similar event the Bitcoin Custodians shall have no liability, obligation or responsibility whatsoever arising out of or relating to

the operation of the underlying software protocols relating to the Bitcoin network or an unsupported branch of a forked protocol and,

accordingly, the Trust acknowledges and assumes the risk of the same.

The Custodial Services Agreement further provides that, unless specifically

communicated by the relevant Bitcoin Custodian and its affiliates through a written public statement on their website, such Bitcoin Custodian

does not support airdrops, metacoins, colored coins, side chains, or other derivative, enhanced or forked protocols, tokens or coins,

which supplement or interact with bitcoin.

In the event of a fork, the Custodial Services Agreements provide that

the Bitcoin Custodians may temporarily suspend services, and may, in their sole discretion, determine whether or not to support (or cease

supporting) either branch of the forked protocol entirely, provided that the Bitcoin Custodians shall use commercially reasonable efforts

to avoid ceasing to support both branches of such forked protocol and will support, at a minimum, the original digital asset.

The Custodial

Services Agreement provides that, other than as set forth therein, and provided that the Bitcoin Custodians shall make commercially reasonable

efforts to assist the Trust to retrieve and/or obtain any assets related to a fork, airdrop or similar event the Bitcoin Custodians shall

have no liability, obligation or responsibility whatsoever arising out of or relating to the operation of the underlying software protocols

relating to the Bitcoin network or an unsupported branch of a forked protocol and, accordingly, the Trust acknowledges and assumes the

risk of the same.

The Custodial Services Agreements further provides that, unless specifically communicated by the relevant Bitcoin Custodian

and its affiliates through a written public statement on their website, such Bitcoin Custodian does not support airdrops, metacoins, colored

coins, side chains, or other derivative, enhanced or forked protocols, tokens or coins, which supplement or interact with bitcoin.

Under the Trust Agreement,

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federal income tax purposes or otherwise be prohibited by this Trust Agreement.

With respect to any fork,

airdrop or similar event, the Sponsor will cause the Trust to irrevocably abandon the Incidental Rights or IR Virtual Currency.

event the Trust seeks to change this position, an application would need to be filed with the SEC by the Exchange seeking approval to

amend its listing rules.

With respect to any fork, airdrop

or similar event, the Sponsor will cause the Trust to irrevocably abandon the Incidental Rights or IR Virtual Currency.

the Trust seeks to change this position, an application would need to be filed with the SEC by the Exchange seeking approval to amend

its listing rules.

the Custodial Services Agreements, the Bitcoin Custodians’ liability is limited.

With respect to the Coinbase Custody Agreement,

the Coinbase Custodian’s liability is as follows, among others:

(i) the Coinbase Custodian’s aggregate liability with respect

to any breach of its obligations under the Coinbase Custody Agreement shall not exceed the aggregate amount of fees paid by the Trust

to the Coinbase Custodian in respect of the Prime Broker Services in the 12 months prior to the event giving rise to such liability;

(ii) the Coinbase Custodian’s aggregate liability under the Coinbase Custody Agreement shall not exceed the greater of (A) the

aggregate fees paid by the Trust to the Coinbase Custodian in respect of the custodial services in the 12 months prior to the event giving

rise to the Coinbase Custodian’s liability, and (B) the value of the supported bitcoin on deposit in the Trust’s custodial

account(s) giving rise to the Coinbase Custodian’s liability at the time of the event giving rise to the Coinbase Custodian’s

(iii) the Coinbase Custodian’s aggregate liability in respect of each cold storage address shall not exceed $100 million;

(iv) in respect of any incidental, indirect, special, punitive, consequential or similar losses, the Coinbase Custodian is not liable,

even if the Coinbase Custodian has been advised of or knew of or should have known of the possibility thereof;

and (v) in no event shall

the Coinbase Custodian or its affiliates have any liability to the Trust or any third party with respect to any breach of its obligations

under the Coinbase Custody Agreement, express or implied, which does not result solely from its gross negligence, fraud or willful misconduct.

Coinbase Custodian is not liable for delays, suspension of operations, failure in performance, or interruption of service which result

directly or indirectly from any cause or condition beyond the reasonable control of the Coinbase Custodian.

In the event of potential

losses incurred by the Trust as a result of the Coinbase Custodian losing control of the Trust’s bitcoin or failing to properly

execute instructions on behalf of the Trust, the Coinbase Custodian’s liability with respect to the Trust will be subject to certain

limitations which may allow it to avoid liability for potential losses or may be insufficient to cover the value of such potential losses,

even if the Coinbase Custodian directly caused such losses.

Furthermore, the insurance maintained by the Coinbase Custodian may be insufficient

to cover its liabilities to the Trust.

respect to the BitGo Custody Agreement, BitGo, in its capacity as a Bitcoin Custodian (the “BitGo Custodian”) and its affiliates,

including their officers, directors, agents, and employees, are not liable for any lost profits, special, incidental, indirect, intangible,

or consequential damages resulting from authorized or unauthorized use of the Trust or Sponsor’s site or services.

This includes

damages arising from any contract, tort, negligence, strict liability, or other legal grounds, even if the BitGo Custodian was previously

advised of, knew, or should have known about the possibility of such damages.

However, this exclusion of liability does not extend to

cases of the BitGo Custodian’s fraud, willful misconduct, or gross negligence.

In situations of gross negligence, the BitGo Custodian’s

liability is specifically limited to the value of the digital assets or fiat currency that were affected by the negligence.

Additionally,

the total liability of the BitGo Custodian for direct damages is capped at the fees paid or payable to them under the BitGo Custody Agreement

during the twelve-month period immediately preceding the first incident that caused the liability.

With respect to the Anchorage Custody Agreement, except for Anchorage’s,

in its capacity as a Bitcoin Custodian (the “Anchorage Custodian”) bad acts, confidentiality obligations under the Anchorage

Custody Agreement, indemnification obligations under Anchorage Custody Agreement, or obligations with respect to rights to or limits on

use under the Anchorage Custody Agreement, Anchorage is not liable for any losses, whether in contract, tort or otherwise, for any amount

in excess of fees paid by the Trust in the twelve (12) months prior to when the liability arises.

Moreover, the Anchorage Custodian is

not liable for (i) losses which arise from its compliance with applicable laws, including sanctions laws administered by the Office of

Foreign Assets Control (“OFAC”) of the U.S.

Department of the Treasury (the “U.S.

Treasury Department”);

special, indirect or consequential damages, or lost profits or loss of business arising in connection with the Anchorage Custody Agreement.

In addition, the Anchorage Custodian is not liable for any losses which arise as a result of the non-return of digital assets that the

Trust has delegated to the Anchorage Custodian or a third party for on-chain services, such as staking, voting, vesting, and signaling,

unless such losses occur as a result of the Anchorage Custodian’s fraud or intentional misconduct.

respect to the BitGo New York Custody Agreement, BitGo New York, in its capacity as a Bitcoin Custodian (the “BitGo New York Custodian”)

and its affiliates, including their officers, directors, agents, and employees, are not liable for any lost profits, special, incidental,

indirect, intangible, or consequential damages resulting from authorized or unauthorized use of the Trust or Sponsor’s site or

This includes damages arising from any contract, tort, negligence, strict liability, or other legal grounds, even if the BitGo

New York Custodian was previously advised of, knew, or should have known about the possibility of such damages.

However, this exclusion

of liability does not extend to cases of the BitGo New York Custodian’s fraud, willful misconduct, or gross negligence.

In situations

of gross negligence, the BitGo New York Custodian’s liability is specifically limited to the value of the digital assets or fiat

currency that were affected by the negligence.

Additionally, the total liability of the BitGo New York Custodian for direct damages is

capped at the fees paid or payable to them under the BitGo New York Custody Agreement during the twelve-month period immediately preceding

the first incident that caused the liability.

Bitcoin Custodians are not liable for delays, suspension of operations, failure in performance, or interruption of service which result

directly or indirectly from any cause or condition beyond the reasonable control of the Bitcoin Custodians.

Under the Custodial Services

Agreement, the Bitcoin Custodians’ liability is limited as follows, among others:

(i) other than with respect to claims and losses

arising from spot trading of bitcoin, or fraud or willful misconduct, among others, the Bitcoin Custodians’ aggregate liability

under the Custodial Services Agreement shall not exceed the greater of (A) the greater of (x) $5 million and (y) the aggregate fees paid

by the Trust to the Bitcoin Custodians in the 12 months prior to the event giving rise to the Bitcoin Custodians’ liability, and

(B) the value of the affected bitcoin or cash giving rise to the Bitcoin Custodians’ liability;

(ii) the Bitcoin Custodians’

aggregate liability in respect of each cold storage address shall not exceed $100 million;

(iii) in respect of the Bitcoin Custodians’

obligations to indemnify the Trust and its affiliates against third party claims and losses to the extent arising out of or relating to,

among others, the Bitcoin Custodians’ violation of any law, rule or regulation with respect to the provision of its services, the

Bitcoin Custodians’ liability shall not exceed the greater of (A) $5 million and (B) the aggregate fees paid by the Trust to the

Bitcoin Custodians in the 12 months prior to the event giving rise to the Bitcoin Custodians’ liability;

and (iv) in respect of

any incidental, indirect, special, punitive, consequential or similar losses, the Bitcoin Custodians are not liable, even if the Bitcoin

Custodians have been advised of or knew or should have known of the possibility thereof.

The Bitcoin Custodians are not liable for delays,

suspension of operations, failure in performance, or interruption of service to the extent it is directly due to a cause or condition

beyond the reasonable control of the Bitcoin Custodians.

Under the Custodial Services Agreement, except in the case of its negligence,

fraud, material violation of applicable law or willful misconduct, the Bitcoin Custodians shall not have any liability, obligation, or

responsibility for any damage or interruptions caused by any computer viruses, spyware, scareware, Trojan horses, worms or other malware

that may affect the Trust’s computer or other equipment, or any phishing, spoofing or other attack, unless the Bitcoin Custodians

fail to have commercially reasonable policies, procedures and technical controls in place to prevent such damages or interruptions.

The Bitcoin Custodians may

terminate the Custodial Services Agreement for any reason upon providing the applicable notice to the Trust, or immediately for Cause

(as defined in the Custodial Services Agreement), including, among others, if the Trust materially breaches the Prime Broker Agreement

and such breach remains uncured, or undergoes a bankruptcy event.

The Sponsor may, in its sole

discretion, add or terminate custodians at any time.

The Sponsor may, in its sole discretion, change the custodians for the Trust’s

bitcoin holdings, but it will have no obligation whatsoever to do so or to seek any terms for the Trust from other such custodians.

Agreements, except in the case of their gross negligence, fraud, willful misconduct, breach of the BitGo Custody Agreement in the case

of the BitGo Custodian, or breach of the BitGo New York Custody Agreement in the case of the BitGo New York Custodian, the Bitcoin Custodians

shall not have any liability for any damage or interruptions caused by any computer viruses, spyware, scareware, Trojan horses, worms

or other malware that may affect the Trust’s computer or other equipment, or any phishing, spoofing or other attack.

The Bitcoin Custodians may terminate the Custodial Services Agreements

for any reason upon providing the applicable notice to the Trust, or immediately for Cause (as defined in the applicable Custodial Services

Agreement), including, among others, if the Trust:

materially breaches the Prime Broker Agreement and such breach remains uncured, or

undergoes a bankruptcy event.

The Trust’s Transfer

Agent will facilitate the settlement of Shares in response to the placement of creation orders and redemption orders from Authorized Participants.

The Trust generally does not intend to hold cash or cash equivalents.

However, there may be situations where the Trust will unexpectedly

hold cash on a temporary basis, including in connection with the settlement of creation and redemption transactions.

cash and cash equivalents will be held at its account at the Cash Custodian, pursuant to the Cash Custody Agreement.

The Sponsor may, in its sole discretion, add or terminate bitcoin custodians

The Sponsor may, in its sole discretion, change the Bitcoin Custodians for the Trust’s bitcoin holdings, but it will

have no obligation whatsoever to do so or to seek any particular terms for the Trust from other such Bitcoin custodians.

Should the Sponsor

choose to add or terminate a Bitcoin Custodian, the Trust will notify Shareholders in a prospectus supplement and/or a current report

on Form 8-K or in its annual or quarterly reports, and, in any case, within four business days of such termination or addition.

Pursuant to the Prime Broker

108 unchanged sentences

compliance with applicable SEC and Financial Industry Regulatory Authority (“FINRA”) advertising laws, rules, and regulations.

Creation Baskets are created

or redeemed only by Authorized Participants.

Each Authorized Participant must be a registered broker-dealer, a participant in DTC, and

have entered into an agreement with the Sponsor and Administrator (the “Authorized Participant Agreement”).

Baskets are created or redeemed only by Authorized Participants.

Each Authorized Participant must be a registered broker-dealer, a participant

in DTC, and have entered into an agreement with the Sponsor and Administrator (the “Authorized Participant Agreement”).

Authorized Participant Agreement provides the procedures for the creation and redemption of Creation Baskets and for the delivery of

the bitcoin required for such creations and redemptions.

By executing an Authorized Participant Agreement, an Authorized Participant

becomes part of the group of parties eligible to purchase Creation Baskets from, and put Creation Baskets for redemption to, the Trust.

The Authorized Participant Agreement may provide for in-kind Basket creations and redemptions.

An Authorized Participant is under no

obligation to create or redeem Creation Baskets or to offer to the public Shares of any Creation Baskets it does create.

The Authorized

Participant Agreement provides the procedures for the creation and redemption of Creation Baskets and for the delivery of cash in connection

with such creations or redemptions.

Participant Agreement and the related procedures attached thereto may be amended by the Trust, without the consent of any Shareholder

or Authorized Participant.

Additional Authorized Participants may be added at any time, subject to the discretion of the Sponsor.

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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-K

Item 1. Business