What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-08-14 compared with 2025-05-15 · 105 added, 122 removed, 422 unchanged (35% of the section changed)

33 unchanged sentences

Overview/Introduction

Commodities Trust I (“Trust”), a Delaware statutory trust organized on February 10, 2023, is a series trust

currently consisting of one series:

Hashdex Bitcoin ETF (f/k/a Hashdex Bitcoin Futures ETF) (“DEFI” or the

The Trust also includes one additional series, the 7RCC Spot Bitcoin and Carbon Credit Futures ETF,

which may be publicly offered in the future.

Commodities Trust I (“Trust”), a Delaware statutory trust organized on February 10, 2023, is a series trust currently

consisting of one series:

Hashdex Bitcoin ETF (f/k/a Hashdex Bitcoin Futures ETF) (“DEFI” or the “Fund”).

The Trust also includes one additional series, the 7RCC Spot Bitcoin and Carbon Credit Futures ETF, which may be publicly offered

in the future.

The Fund is a commodity pool.

The Fund issues shares of beneficial interest, with no par value (the “Shares”), representing fractional undivided beneficial interests in the Fund.

The Fund’s investment

objective is for changes in the Shares’ net asset value (“NAV”) to reflect the daily changes of the price

of the Nasdaq Bitcoin Reference Price - Settlement (NQBTCS) (the “Benchmark”), less expenses from the

Fund’s operations.

The Benchmark is designed to track the price performance of bitcoin.

The Fund invests in bitcoin,

bitcoin futures contracts (“Bitcoin Futures Contracts”) listed on the Chicago Mercantile Exchange Inc.

The Fund issues shares of beneficial interest, with no par value (the “Shares”),

representing fractional undivided beneficial interests in the Fund.

The Fund’s investment objective is for changes in the

Shares’ net asset value (“NAV”) to reflect the daily changes of the price of the Nasdaq Bitcoin Reference Price

- Settlement (NQBTCS) (the “Benchmark”), less expenses from the Fund’s operations.

The Benchmark is designed

to track the price performance of bitcoin.

The Fund invests in bitcoin, bitcoin futures contracts (“Bitcoin Futures Contracts”)

listed on the Chicago Mercantile Exchange Inc.

(“CME”), and cash and cash equivalents.

Because the Fund’s investment objective is to track the price of

the Benchmark, changes in the price of the Shares may vary from changes in the spot price of bitcoin.

Because the Fund’s investment

objective is to track the price of the Benchmark, changes in the price of the Shares may vary from changes in the spot price of

Trust and the Fund operate pursuant to the Trust’s Amended and Restated Declaration of Trust and Trust Agreement (the “Trust

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sponsor of the Trust is Tidal Investments LLC, a Delaware limited liability company (the “Sponsor”).

The principal

office of the Sponsor is Milwaukee, Wisconsin and the Trust is located at 234 West Florida Street, Suite 203, Milwaukee, Wisconsin

The Sponsor is registered as a commodity pool operator (“CPO”) with the Commodity Futures Trading Commission

(“CFTC”) and is a member of the National Futures Association (“NFA”).

The Fund intends to be treated as

a partnership for U.S.

principal office of the Sponsor is Milwaukee, Wisconsin and the Trust is located at 234 West Florida Street, Suite 203,

Milwaukee, Wisconsin 53204.

The Sponsor is registered as a commodity pool operator (“CPO”) with the Commodity

Futures Trading Commission (“CFTC”) and is a member of the National Futures Association (“NFA”).

Fund intends to be treated as a partnership for U.S.

federal income tax purposes.

The Sponsor has sponsored the Trust since

Sponsoring the Fund will be

the Sponsor’s first experience in operating an exchange traded product that invests in crypto-currency futures or directly

The Sponsor’s responsibilities are discussed below in the section entitled “ The Sponsor’s Operations.

Sponsoring the Fund will be the Sponsor’s first experience in operating an exchange traded product that invests

in crypto-currency futures or directly in bitcoin.

The Sponsor’s responsibilities are discussed below in the section

entitled “ The Sponsor’s Operations.

investors will purchase and sell Shares through their broker-dealer, the Fund continuously offers creation baskets consisting

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Fund’s shares commenced trading on the NYSE Arca upon the effectiveness of the Merger under the ticker symbol “ DEFI.

of Me rg er - Conversion to U.S.

of Merger - Conversion to U.S.

Spot Bitcoin ETF

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remaining assets may be invested in CME-traded bitcoin futures contracts and in cash and cash equivalents.

report covers the periods from January 1, 2025 to March 31, 2025 for DEFI.

Per Share Operation Performance

Net asset value at beginning of period

Income (loss) from investment operations:

Investment income

Net realized and unrealized gain (loss) on investments and cryptocurrency

futures contracts

Total expenses

Net increase (decrease) in net asset value

Net asset value at end of period

Ratios to Average Net Assets (Annualized)

Total expenses

Total expenses, net

Net investment income (loss)

report covers the periods from January 1, 2025 to June 30, 2025 for DEFI.

Share Operation Performance

asset value at beginning of period

(loss) from investment operations:

realized and unrealized gain (loss) on investments and cryptocurrency futures contracts

increase (decrease) in net asset value

asset value at end of period

to Average Net Assets (Annualized)

expenses, net

investment income (loss)

Outlook - The Bitcoin Industry

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the Fund enters into futures contracts, it will be exposed to the credit risk that the counterparty will not be able to meet its

For purposes of credit risk, the counterparty for the futures contracts traded on the Chicago Board of Trade, Intercontinental Exchange and CME is the clearinghouse

associated with those exchanges.

In general, clearinghouses are backed by their members who may be required to share in the financial

burden resulting from the non-performance of one of their members, which should significantly reduce credit risk.

exchanges are not backed by their clearinghouse members but may be backed by a consortium of banks or other financial institutions.

Unlike in the case of exchange traded futures contracts, the counterparty to an over the counter futures contract is generally

a single bank or other financial institution.

As a result, there will be greater counterparty credit risk in over the counter

transactions.

There can be no assurance that any counterparty, clearinghouse, or their financial backers will satisfy their obligations

For purposes of credit risk, the counterparty for the futures contracts traded on the Chicago Board of Trade, Intercontinental

Exchange and CME is the clearinghouse associated with those exchanges.

In general, clearinghouses are backed by their members

who may be required to share in the financial burden resulting from the non-performance of one of their members, which should

significantly reduce credit risk.

Some foreign exchanges are not backed by their clearinghouse members but may be backed by a

consortium of banks or other financial institutions.

Unlike in the case of exchange traded futures contracts, the counterparty

to an over the counter futures contract is generally a single bank or other financial institution.

As a result, there will be

greater counterparty credit risk in over the counter transactions.

There can be no assurance that any counterparty, clearinghouse,

or their financial backers will satisfy their obligations to the Fund.

Sponsor will attempt to manage the credit risk of the Fund by following certain trading limitations and policies.

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posting of collateral by such parties for the benefit of each Fund to limit its credit exposure.

CEA requires all Future Commission Merchants (the “FCMs”), such as the Fund’s clearing brokers, to meet and maintain specified fitness and financial requirements,

to segregate customer funds from proprietary funds and account separately for all customers’ funds and positions, and to

maintain specified books and records open to inspection by the staff of the CFTC.

The CFTC has similar authority over introducing

brokers, or persons who solicit or accept orders for commodity interest trades but who do not accept margin deposits for the execution

The CEA authorizes the CFTC to regulate trading by FCMs and by their officers and directors, permits the CFTC to require

action by exchanges in the event of market emergencies, and establishes an administrative procedure under which customers may

institute complaints for damages arising from alleged violations of the CEA.

The CEA also gives the states powers to enforce its

provisions and the regulations of the CFTC.

CEA requires all Future Commission Merchants (the “FCMs”), such as the Fund’s clearing brokers, to meet and

maintain specified fitness and financial requirements, to segregate customer funds from proprietary funds and account separately

for all customers’ funds and positions, and to maintain specified books and records open to inspection by the staff of the

The CFTC has similar authority over introducing brokers, or persons who solicit or accept orders for commodity interest

trades but who do not accept margin deposits for the execution of trades.

The CEA authorizes the CFTC to regulate trading by FCMs

and by their officers and directors, permits the CFTC to require action by exchanges in the event of market emergencies, and establishes

an administrative procedure under which customers may institute complaints for damages arising from alleged violations of the

The CEA also gives the states powers to enforce its provisions and the regulations of the CFTC.

November 14, 2013, the CFTC published final regulations that require enhanced customer protections, risk management programs,

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of Operations

discussion below addresses the material changes in the results of operations for the three months ended March 31, 2025 compared

discussion below addresses the material changes in the results of operations for the three months ended June 30, 2025, compared

to the same period in 2024.

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Performance data from March 27, 2024, onward reflect the Fund’s current investment strategy.

March 31, 2025, the Fund held 15,785 Units of spot bitcoin with an asset fair value of $13,000,180.

March 31, 2025

March 31, 2024

December 31, 2024

Total Net Assets

Shares Outstanding

Net Asset Value per share

Closing Price

net assets for the Fund increased year over year by 15.48%, driven by a combination of an increase in shares outstanding of 79,996

shares or 160% and an increase in the NAV per share of $12.55 or 15.48%.

The change in total net assets year over year was generally

due to the Bitcoin price appreciation from $69,487.25 per Bitcoin as of March 29, 2024, to $82,520.96 per Bitcoin as of March

31, 2025, representing an approximate 18.76% increase during the period March 29, 2024 to March 31, 2025.

the three months ended March 31, 2025, compared to the three months ended March 31, 2024

Quarter Ended

March 31, 2025

March 31, 2024

Average daily total net assets

Net realized and unrealized gain (loss) on futures contracts and investments

$ (1,712,846 )

Interest income earned on cash equivalents

Annualized interest yield based on average daily total net assets

Net Income (Loss)

June 30, 2025, the Fund held 13,487 Units of spot bitcoin with an asset fair value of $14,522,529.

Asset Value per share

net assets for the Fund increased year over year by 133.57%, driven by an increase in the NAV per share of $53.45 or 178.11%.

The change in total net assets year over year was generally due to the Bitcoin price appreciation from $59,874.22 per Bitcoin

as of June 30, 2024, to $107,676.94 per Bitcoin as of June 30, 2025, representing an approximate 179.83% increase during the period

July 1, 2024 to June 30, 2025.

the three months ended June 30, 2025, compared to the three months ended June 30, 2024

June 30, 2024

daily total net assets

realized and unrealized gain (loss) on futures contracts and investments

income earned on cash equivalents

interest yield based on average daily total net assets

Income (Loss)

$ (2,022,552 )

Weighted average share outstanding

Management Fees

Total gross fees and other expenses excluding management fees

Brokerage Commissions

Total gross expense ratio

Net investment gain (loss)

Creation of Shares

Redemption of Shares

average share outstanding

gross fees and other expenses excluding management fees

gross expense ratio

investment gain (loss)

Realized Gain or Loss on Futures Contracts

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loss on futures contracts was related to the decrease in the Fund’s net assets and the Bitcoin price depreciation during

the three months ended March 31, 2025.

the three months ended March 31, 2025 compared to the three months ended March 31, 2024, the amount of interest income earned

as a percentage of daily total net assets was significantly lower.

The decrease in interest and other income over these periods

was primarily due to a decrease in the investments within short-term Treasury Securities, demand deposits, money market funds

and/or investments in commercial paper;

the three months ended June 30, 2025.

the three months ended June 30, 2025 compared to the three months ended June 30, 2024 the amount of interest income earned as

a percentage of daily total net assets was significantly lower.

The decrease in interest and other income over these periods was

primarily due to a decrease in the investments within short-term Treasury Securities, demand deposits, money market funds and/or

investments in commercial paper;

in the Fund’s current policy, only up to 5% of the Fund’s assets may be invested

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the prospectuses and thus will impact your breakeven point.

decrease in management fee paid to the Sponsor for the three months ended March 31, 2025, compared to the three months ended March

31, 2024, is a result of lower Fund average net assets overall, which was also net of the Sponsor lowering the management fee

from 0.90% to 0.25% per annum of the daily NAV of the Fund effective February 10, 2025.

In the three months ended March 31, 2025,

Other than the management fee to the Sponsor, the Fund did not incur total gross fees and other expenses excluding management

fees, brokerage commissions and trading fees;

unlike the three months ended March 31, 2024, where the Fund incurred brokerage

commissions and trading fees.

Brokerage commissions are recognized on a per-trade basis to each futures contract’s or bitcoin

share’s cost basis.

Trading fees for the Fund are recorded in the statement of operations as broker expenses.

amount of trading fees to be incurred will vary based upon the trading frequency of the Fund.

decrease in management fee paid to the Sponsor for the three months ended June 30, 2025, compared to the three months ended June

30, 2024, despite higher Fund average net assets overall, is a result of the Sponsor lowering the management fee from 0.90% to

0.25% per annum of the daily NAV of the Fund effective February 10, 2025.

Other than the management fee to the Sponsor, the Fund

incurred total gross fees and other expenses excluding management fees and brokerage commissions, which were significantly lower

than during the three months ended June 30, 2024, where the Fund incurred brokerage commissions.

Brokerage commissions are recognized

on a per-trade basis to each futures contract’s or bitcoin share’s cost basis.

Trading fees for the Fund are recorded

in the statement of operations as broker expenses.

The actual amount of trading fees to be incurred will vary based upon the trading

frequency of the Fund.

the three months ended March 31, 2024, most of the expenses incurred by the Predecessor Fund were associated with the management

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months ended March 31, 2025.

decrease in total brokerage commissions for the three months ended March 31, 2025, compared to the nine months ended March 31,

2024, was primarily due to a decrease in futures contracts purchased, liquidated, and rolled given the Fund’s current policy

to maximize its holdings of physical bitcoin instead of CME-traded bitcoin futures contracts.

decrease in total brokerage commissions for the three months ended June 30, 2025, compared to the nine months ended June 30, 2024,

was primarily due to a decrease in futures contracts purchased, liquidated, and rolled given the Fund’s current policy to

maximize its holdings of physical bitcoin instead of CME-traded bitcoin futures contracts.

graph below shows the actual shares outstanding, total net assets (or AUM) and net asset value per share (NAV per share) for the

Fund from inception to March 31, 2025 and serves to illustrate the relative changes of these components.

Fund from inception to June 30 , 2025 and serves to illustrate the relative changes of these components.

Balance Sheet Financing

Trust or Fund has no obligations, assets or liabilities which would be considered off-balance sheet arrangements as of March 31, 2025.

Neither the Trust nor the Fund participates in transactions that create relationships with unconsolidated entities or

financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of

facilitating off-balance sheet arrangements.

Neither the Trust nor the Fund have entered into any off-balance sheet financing

arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any

non-financial assets.

Trust or Fund has no obligations, assets or liabilities which would be considered off-balance sheet arrangements as of June 30,

Neither the Trust nor the Fund participates in transactions that create relationships with unconsolidated entities or financial

partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating

off-balance sheet arrangements.

Neither the Trust nor the Fund have entered into any off-balance sheet financing arrangements,

established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial

and Capital Resources

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Futures Contracts change.

The Fund earned $183 and $178,749, respectively, in interest income during the three months ended March

The Fund earned $322 and $4,720, respectively, in interest income during the three months ended June

30, 2025 and 2024.

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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-Q

Item 2. Management’s Discussion and Analysis