What changed in this filing

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Item 1. Business

2026-03-31 compared with 2025-03-25 · 1113 added, 1800 removed, 146 unchanged (95% of the section changed)

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 Fund is a commodity pool.

The Fund issues shares of beneficial interest, called “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)

Commodities Trust (f/k/a Tidal Commodities Trust I, prior to January 16, 2026) (the “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 Fund issues shares of beneficial interest, called “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

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.

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

Agreement”), dated March 10, 2023.

The Fund’s assets consist of bitcoin and, potentially, limited amounts of cash.

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.

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

Agreement”), dated January 15, 2026.

On January 2, 2024, the initial Form S-1 for DEFI was declared effective by the U.S.

Securities and Exchange Commission (“SEC”).

As noted below, the Fund is the successor to the Predecessor Fund (defined

below), which commenced operations in September 2022.

The current registration statement for DEFI was declared effective by the

SEC on January 2, 2024 and registered an indeterminate number of Shares.

BitGo Trust Company, Inc (the “Bitcoin Custodian”)

is the custodian for the Fund’s bitcoin holdings;

is the custodian for the Fund’s cash and cash

equivalents holdings (the “Cash Custodian” and together with the Bitcoin Custodian, the “Custodians”).

Fund is the successor and surviving entity from the merger (the “Merger”) of the Hashdex Bitcoin Futures ETF (the

“Predecessor Fund”) into the Fund.

The Predecessor Fund was a series of the Teucrium Commodity Trust (the “Predecessor

Trust”) sponsored by Teucrium Trading, LLC (“Prior Sponsor”).

and Exchange Commission (“SEC”).

BitGo Trust Company, Inc (the “Bitcoin Custodian”) is the custodian for the

Fund’s bitcoin holdings; and U.S.

is the custodian for the Fund’s cash holdings (the “Cash Custodian”

and together with the Bitcoin Custodian, the “Custodians”).

The principal address of the Fund is 1100 North Market Street,

Suite 1300, Wilmington, DE 19801 and the telephone number of the Fund is (302) 651-1000.

Fund is the successor and surviving entity from the merger (the “Merger”) of the Hashdex Bitcoin Futures ETF (the “Predecessor

Fund”) into the Fund.

The Predecessor Fund was a series of the Teucrium Commodity Trust (the “Predecessor Trust”) sponsored

by Teucrium Trading, LLC (“Teucrium”).

The Merger closed on January 3, 2024.

In connection

with the Merger, the Predecessor Fund shareholders received one Share for each share of the Predecessor Fund they owned prior

to the Merger.

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.

federal income tax purposes.

The Sponsor has sponsored the Trust since 2023.

Sponsoring the Fund is the

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

In connection with the Merger, the Predecessor

Fund shareholders received one Share for each share of the Predecessor Fund they owned prior to the Merger.

sponsor of the Fund is Hashdex Asset Management Ltd.

(the “Sponsor” or “Hashdex”), which receives a management

fee (the “Management Fee”).

As of December 31, 2025, the Sponsor served as sponsor, investment manager, or investment adviser

to over 9 pooled investment vehicles across multiple jurisdictions, including investment strategies relating to crypto asset markets.

Prior to January 16, 2026, the Fund’s sponsor was Tidal Investments LLC (f/k/a Toroso Investments, LLC) (“Tidal”).

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

Sponsor has filed a registration statement for another exchange traded fund, Nexo 7RCC Spot Bitcoin and Carbon Credit Futures

ETF (“BTCK”), which is a series of the Trust.

The investment objective of BTCK will be to is to reflect the daily

changes of the price of bitcoin and the value of carbon credit futures contracts.

Additional series may be designated in the future.

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

of 10,000 Shares (“Creation Baskets”) at their NAV to certain financial institutions that have entered into an agreement

with the Sponsor (“Authorized Purchasers”).

investors will purchase and sell Shares through their broker-dealer, the Fund continuously offers and redeems baskets consisting of 10,000

Shares (the “Baskets”) at their NAV to certain financial institutions that have entered into an agreement with the Sponsor

(the “Authorized Purchasers”).

Reorganization

with Hashdex Bitcoin Futures ETF

January 3, 2024, the Trust completed the Merger and acquisition of the Predecessor Fund, a series of the Predecessor Trust, into

the Fund, a series of the Trust.

The Merger was effected pursuant to an Agreement and Plan of Partnership Merger and Liquidation

dated as of October 30, 2023 (the “Plan of Merger”) between the Predecessor Trust, on behalf of its Predecessor Fund

series, and the Trust, on behalf of its Fund series.

to the Plan of Merger, each Predecessor Fund shareholder received one share of the Fund for every one share of the Predecessor

Fund held immediately before the commencement of trading on the NYSE Arca on the Closing Date based on the net asset value per

share of the Predecessor Fund being equal to the net asset value per share of the Fund determined immediately prior to the Merger

The share price used for the delivery of shares of the Predecessor Fund was the net asset value per share of the Predecessor

Fund determined after the close of business of NYSE Arca on January 2, 2024.

Consequently, the Merger resulted in a one-for-one

exchange of shares between the Predecessor Fund and the Fund.

Further, the Fund acquired in the Merger all the assets of the Predecessor

Fund and assumed all the liabilities of the Predecessor Fund.

Effective the Merger closing, the Plan of Merger caused all of the

Predecessor Fund’s shares to be cancelled and the Predecessor Fund to be liquidated.

January 3, 2024 (the “Closing Date”), the Trust completed the Merger and acquisition of the Predecessor Fund, a series of

the Predecessor Trust, into the Fund, a series of the Trust.

The Merger was effected pursuant to an Agreement and Plan of Partnership

Merger and Liquidation dated as of October 30, 2023 (the “Plan of Merger”) between the Predecessor Trust, on behalf of its

Predecessor Fund series, and the Trust, on behalf of its Fund series.

to the Plan of Merger, each Predecessor Fund shareholder received one Share of the Fund for every one share of the Predecessor Fund held

immediately before the commencement of trading on the NYSE Arca on the Closing Date, based on the NAV per share of the Predecessor Fund

being equal to the NAV per Share of the Fund, determined immediately prior to the Merger closing.

The share price used for the delivery

of shares of the Predecessor Fund was the NAV per share of the Predecessor Fund determined after the close of business of the NYSE Arca

on January 2, 2024.

Consequently, the Merger resulted in a one-for-one exchange of shares between the Predecessor Fund and the Fund.

Further, the Fund acquired in the Merger all the assets of the Predecessor Fund and assumed all the liabilities of the Predecessor Fund.

Effective the Merger closing, the Plan of Merger caused all of the Predecessor Fund’s shares to be cancelled and the Predecessor

Fund to be liquidated.

Merger did not materially modify the rights of Predecessor Fund shareholders with respect to their investment.

The Fund has the

same investment objective, investment strategies and investment restrictions, and substantially identical investment risks, as

those had by the Predecessor Fund.

Following the Merger, the Fund is now sponsored by the Sponsor, Tidal Investments LLC (f/k/a

Toroso Investments LLC), and the Fund is now managed by portfolio managers employed by the Sponsor.

The Fund pays the same management

fee rate to the Sponsor, under the same terms, as previously paid by the Predecessor Fund to Teucrium Trading, LLC, the sponsor

of the Predecessor Trust and the Predecessor Fund.

The Fund has the same

investment objective, investment strategies and investment restrictions, and substantially identical investment risks, as those had by

the Predecessor Fund.

Following the Merger, the Fund was sponsored by Tidal, and the Fund is now managed by portfolio managers employed

by the Sponsor.

The Fund pays the same Management Fee rate to the Sponsor, under the same terms, as previously paid by the Predecessor

Fund to Teucrium, the sponsor of the Predecessor Trust and the Predecessor Fund.

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

2 unchanged sentences

March 26, 2024, the Sponsor announced the renaming of the Fund from the Hashdex Bitcoin Futures ETF to the Hashdex Bitcoin ETF.

The renaming of the Fund corresponds to its completion of the conversion of its investment strategy to allow the Fund to provide

spot bitcoin holdings and its tracking of a new benchmark index effective March 27, 2024.

The Fund’s current benchmark index

is the Nasdaq Bitcoin Reference Price - Settlement (NQBTCS), which better reflects the Fund’s current strategy of direct

bitcoin investment.

Under normal market conditions, the Fund’s has a policy to maximize its holdings of physical bitcoin

such that it is expected that at least 95% of the Fund’s assets will be invested in spot bitcoin.

Up to 5% of the Fund’s

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

of the Fund corresponds to its completion of the conversion of its investment strategy to allow the Fund to provide spot bitcoin holdings

and its tracking of a new benchmark index effective March 27, 2024.

The Fund’s current benchmark index is the Nasdaq Bitcoin Reference

Price - Settlement (NQBTCS), which better reflects the Fund’s current strategy of direct bitcoin investment.

Under normal market

conditions, the Fund’s had a policy to maximize its holdings of physical bitcoin such that it was expected that at least 95% of

the Fund’s assets would be invested in spot bitcoin and up p to 5% of the Fund’s assets would be invested in CME-traded bitcoin

futures contracts and in cash and cash equivalents.

after the close of trading on January 15, 2026, Tidal withdrew as the sponsor of the Trust and simultaneously appointed Hashdex as the

sponsor of the Trust (the “Sponsor Replacement”).

In connection with the Sponsor Replacement, certain changes were made to

the Fund’s principal investment strategies and techniques.

Prior to the Sponsor Replacement, the Fund sought to achieve its investment

objective by primarily investing in bitcoin.

The Fund used bitcoin futures contracts for the primary purpose of acquiring physical bitcoin

through Chicago Mercantile Exchange Inc.’s (“CME”) Exchange for Physical Transactions (“EFP”) and to offset

cash and receivables for better tracking the Benchmark.

Under normal market conditions, the Fund had a policy to maximize its investments

in physical bitcoin such that it was expected that at least 95% of the Fund’s assets would be invested in bitcoin, and up to 5%

would be invested in bitcoin futures contracts and in cash and cash equivalents, such as short-term Treasury bills, money market funds,

and demand deposit accounts.

the commencement of Hashdex’s service as the Sponsor, the Fund attempts to achieve its investment objective by primarily investing

The Fund’s assets consist of bitcoin and cash.

The Fund may hold cash in connection with cash purchases and redemptions

of Shares and it also will occasionally hold cash for short periods to pay the Sponsor’s Management Fee and any other Fund expenses

and liabilities not assumed by the Sponsor.

The Fund will not hold any assets other than bitcoin and cash.

Fund is designed to provide investors with a means to gain price exposure to the bitcoin market.

The Fund issues Shares that trade

on NYSE Arca under the symbol “DEFI.” Shares can be purchased and sold by investors through their broker-dealer.

The Fund issues Shares that trade on

NYSE Arca under the symbol “DEFI.” Shares can be purchased and sold by investors through their broker-dealer.

Shares of the Fund is subject to the risks of bitcoin as well as the additional risks of investing in the Fund.

Sponsor will employ a passive investment strategy that is intended to track the changes in price of the Benchmark regardless of

whether the Benchmark goes up or goes down.

Sponsor employes a passive investment strategy that is intended to track the changes in the Benchmark regardless of whether the Benchmark

goes up or goes down.

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.

In order to track the Benchmark

as closely as possible, the Fund will aim to maximize its investment in bitcoin.

Because the Fund’s investment objective

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

The NYSE Arca

rule under which the Shares will be listed and traded prevents the Fund from utilizing leverage.

ICE Data Indices, LLC calculates

an approximate Fund NAV every 15 seconds throughout each day that the Fund’s Shares are traded on NYSE Arca for as long

as the CME’s main pricing mechanism is open.

Fund, the Sponsor, and their service providers, including the Custodians, will not loan or pledge the Fund’s assets, nor

will the Fund’s assets serve as collateral for any loan or similar arrangement except to the extent of need to collateralize

margin accounts held by the Fund’s futures commission merchants (“FCMs”).

is a digital asset or cryptocurrency that is a unit of account on the bitcoin network (“Bitcoin Network”), an open

source, decentralized peer-to-peer computer network.

The ownership and operation of bitcoin is determined by purchasers in the

Bitcoin Network.

The Bitcoin Network connects computers that run publicly accessible, or open source, software that follows the

rules and procedures governing the Bitcoin Network.

The Fund’s assets consist of bitcoin

and, potentially, limited amounts of cash.

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.

The NYSE Arca rule, under which the Shares will be listed

and traded, prevents the Fund from utilizing leverage.

ICE Data Indices, LLC calculates an approximate Fund NAV every 15 seconds throughout

each day that the Fund’s Shares are traded on NYSE Arca.

Fund, the Sponsor, and their service providers, including the Custodians, do not loan or pledge the Fund’s assets, nor does any

such entity use the Fund’s assets as collateral for any loan or similar arrangement.

is a digital asset or cryptocurrency that is a unit of account on the bitcoin network (the “Bitcoin Network”), an open source,

decentralized peer-to-peer computer network.

The ownership and operation of bitcoin is determined by purchasers in the Bitcoin Network.

The Bitcoin Network connects computers that run publicly accessible, or open source, software that follows the rules and procedures governing

the Bitcoin Network.

This is commonly referred to as the Bitcoin Protocol.

Bitcoin may be held,

may be used to purchase goods and services or may be exchanged for fiat currency.

No single entity owns or operates the Bitcoin

Network, and the value of bitcoin is not backed by any government, corporation or other entity.

Instead the value of bitcoin is

determined in part by the supply and demand in markets created to facilitate the trading of bitcoin.

Public key cryptography protects

the ownership and transaction records for bitcoin.

Because the source code for the Bitcoin Network is open source, anyone can

contribute to its development.

At this time, the ultimate supply of bitcoin is finite and limited to 21 million “coins”

with the number of bitcoin available increasing gradually as new bitcoin supplies are mined until the 21 million current protocol

cap is reached.

The following factors, among others, may affect the price and market for bitcoin:

Bitcoin may be held, may be used to purchase goods and services

or may be exchanged for fiat currency.

No single entity owns or operates the Bitcoin Network, and the value of bitcoin is not backed

by any government, corporation or other entity.

Instead the value of bitcoin is determined in part by the supply and demand in markets

created to facilitate the trading of bitcoin.

Public key cryptography protects the ownership and transaction records for bitcoin.

the source code for the Bitcoin Network is open source, anyone can contribute to its development.

At this time, the ultimate supply of

bitcoin is finite and limited to 21 million “coins” with the number of bitcoin available increasing gradually as new bitcoin

supplies are mined until the 21 million current protocol cap is reached.

The following factors, among others, may affect the price and

market for bitcoin:

widely bitcoin is adopted, including the use of bitcoin as a payment.

regulatory environment for cryptocurrencies, which continues to evolve in the U.S., and

which may delay, impede, or restrict the adoption or use of bitcoin.

regulatory environment for cryptocurrencies, which continues to evolve in the U.S., and which

may delay, impede, or restrict the adoption or use of bitcoin.

● Speculative

activity in the market for bitcoin, including by holders of large amounts of bitcoin,

which may increase volatility.

activity in the market for bitcoin, including by holders of large amounts of bitcoin, which

may increase volatility.

● Cyberattacks,

including the risk that malicious actors will exploit flaws in the code or structure

of bitcoin, control the blockchain, steal information or cause disruptions to the internet.

for mining bitcoin are designed to decline over time, which may lessen the incentive

for miners to process and confirm transactions on the Bitcoin Network.

including the risk that malicious actors will exploit flaws in the code or structure of bitcoin,

control the blockchain, steal information or cause disruptions to the internet.

for mining bitcoin are designed to decline over time, which may lessen the incentive for

miners to process and confirm transactions on the Bitcoin Network.

open-source nature of the Bitcoin Network may result in forks, or changes to the underlying

code of bitcoin that result in the creation of new, separate digital assets.

manipulation, security failure or operational problems at bitcoin exchanges that result

in a decline in adoption or acceptance of bitcoin.

manipulation, security failure or operational problems at bitcoin exchanges that result in

a decline in adoption or acceptance of bitcoin.

● Scalability

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Benchmark Methodology

Benchmark is governed by the Nasdaq Crypto Index Oversight Committee (“CIOC”), which is responsible for implementation,

administration, and oversight of the Benchmark, including its cessation.

The CIOC shall approve any material changes to the methodology

and review the Benchmark methodology at least on an annual basis.

The final Benchmark is calculated once every trading day and

it is given by a weighted average across the settlement prices of the following “Core Exchanges” (as of December 29,

Bitstamp, Coinbase, Gemini, itBit and Kraken.

Benchmark was launched by Nasdaq on June 9, 2021 and is designed to track the price performance of bitcoin.

Specifically, the

Benchmark attempts to track the average bitcoin spot price by capturing the notional value of bitcoin USD transactions reported

by selected public data sources as measured by Nasdaq.

The Benchmark applies a rules- based pricing methodology to a diverse collection

of pricing sources to provide a reference price for bitcoin and the pricing methodology is designed to account for variances in

price across a wide range of sources which have been vetted according to criteria identified in the methodology document.

Benchmark is owned and administered by Nasdaq and may be changed from time to time.

Detailed rules on the Benchmark administration

and governance may be found at Nasdaq’s website.

The Benchmark does not track the overall performance of all digital assets

generally, nor the performance of any specific digital asset other than bitcoin.

The Benchmark is calculated and published once

a day on business days at 3:00 p.m., New York Time by CF Benchmarks Limited ( https://www.cfbenchmarks.com/data/indices/NQBTCS )

or other Nasdaq designated calculation agent.

to the Benchmark methodology, any deviations from the Benchmark methodology are made in the sole judgment and discretion of Nasdaq

so that the Benchmark continues to achieve its objective.

Benchmark is governed by the Nasdaq Index Management Committee (the “IMC”), which is responsible for implementation, administration,

and oversight of the Benchmark, including its cessation.

The IMC shall approve any material changes to the methodology and review the

Benchmark methodology at least on an annual basis.

The final Benchmark is calculated once every trading day and it is given by a weighted

average across the settlement prices of the following “Core Exchanges” (as of December 31, 2025);

Bitstamp, Coinbase, Gemini,

itBit, Kraken and LMAX Digital.

Benchmark was launched by Nasdaq, Inc.

(the “Nasdaq”), on June 9, 2021 and is designed to track the price performance of

Specifically, the Benchmark attempts to track the average bitcoin spot price by capturing the notional value of bitcoin U.S.

dollar (“USD”) transactions reported by selected public data sources as measured by Nasdaq.

The Benchmark applies a rules-based

pricing methodology to a diverse collection of pricing sources to provide a reference price for bitcoin and the pricing methodology is

designed to account for variances in price across a wide range of sources which have been vetted according to criteria identified in

the methodology document.

The Benchmark is owned and administered by Nasdaq and may be changed from time to time.

Detailed rules on the

Benchmark’s administration and governance may be found on Nasdaq’s website.

The Benchmark does not track the overall performance

of all digital assets generally, nor the performance of any specific digital asset other than bitcoin.

The Benchmark is calculated and

published once a day on business days at 4:00 p.m., Eastern Time (“E.T.”) by CF Benchmarks Limited ( https://www.cfbenchmarks.com/data/indices/NQBTCS )

or another Nasdaq designated calculation agent.

to the Benchmark methodology, any deviations from the Benchmark methodology are made in the sole judgment and discretion of Nasdaq so

that the Benchmark continues to achieve its objective.

Nasdaq will provide transparency over the decisions affecting the compilation

1 unchanged sentence

inputs, market stress or disruption, failure of critical infrastructure, or other relevant factors.

Any contingency measures that

are not directly addressed in the Benchmark methodology shall be subject to CIOC governance processes.

Sponsor, in its sole discretion, may cause the Fund to track a benchmark other than the Benchmark at any time, with prior notice

to investors.

The Sponsor may change the Fund’s benchmark if investment conditions change or the Sponsor believes that another

benchmark or standard better aligns with the Fund’s investment objective and strategy.

The Sponsor, however, is under no

obligation whatsoever to make such a change in any circumstance.

the extent CIOC implements a material change to the calculation of the Benchmark, the Sponsor will issue a press release describing

such change and its date of implementation which press release will be filed with the SEC on Form 8-K.

the extent the Sponsor determines that in the best interest of the Fund to replace the Benchmark with another benchmark reference

price or index, the Sponsor shall issue a press release describing the replacement of the Benchmark and new benchmark at least

60 days in advance of such replacement and will file such press release under Form 8-K with the SEC.

Futures Contracts

CME currently offers two Bitcoin Futures Contracts, one contract representing 5 bitcoin (“BTC Contracts”) and another

contract representing 0.10 bitcoin (“MBT Contracts”).

The Fund will invest up to 5% of its assets in bitcoin BTC Contracts

and MBT Contracts to the extent necessary to achieve exposure to the bitcoin futures market.

Because the Fund’s investment

objective is to track the price of the Benchmark by investing in bitcoin and Bitcoin Futures Contracts, changes in the price of

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

Fund maintains long positions in BTC Contracts and MBT Contracts to achieve exposure to the bitcoin futures market.

under “the Fund’s Investment Strategies,” the Sponsor invests the Fund’s assets in spot bitcoin and utilizes

Bitcoin Futures Contracts to hedge the cash balance that the Sponsor deems necessary to meet the Fund’s liquidity needs

for the cash payment of Share redemption settlements and of other applicable expenses borne by the Fund.

The Fund may purchase

MBT Contracts if the Fund has proceeds remaining from the sale of a Creation Basket that are less than the price of a BTC contract.

BTC and MBT will count toward an aggregate position limit.

Contracts began trading on the CME Globex trading platform on December 15, 2017 under the CME ClearPort ticker symbol “BTC”

and are cash settled in U.S.

MBT Contracts began trading on the CME Globex trading platform on May 3, 2021 under the

CME ClearPort ticker symbol “MBT” and are also cash settled in U.S.

The daily settlement prices for MBT Contracts

are derived directly from the settlements in the BTC Contracts.

BTC Contracts and MBT Contracts are listed for trading in serial

months of six (6), quarterly in serial quarters of four (4).

Additionally, when the listing schedule includes only a single futures

contract set to expire in December, an extra December contract will be listed for the subsequent year.

This ensures that at any

given time, there are at least two December contracts available for trading.

BTC Contracts and MBT Contracts are exchange-listed, they allow investors to gain price exposure to bitcoin without having to

hold the underlying cryptocurrency.

Like a futures contract on a commodity or stock index, BTC Contracts and MBT Contracts provide

a means for investors to hedge investment positions or speculate on the future price of bitcoin.

Bitcoin Futures Contracts are cash-settled to the CME CF Bitcoin Reference Rate (BRR).

The BRR is a daily reference rate of the

dollar price of one bitcoin calculated daily as of 4:00 p.m.

London time provided by CF Benchmarks.

It is calculated based

on the bitcoin trading activity on specified spot bitcoin trading platforms (“Constituent Exchanges”) during an observation

window between 3:00 p.m.

and 4:00 p.m.

London time, which currently include Bitstamp, Coinbase, Gemini, itBit Kraken and LMAX

Digital but may change from time to time.

exchanges for the BRR are selected on the basis of the following criteria, which each must demonstrate that it continues to fulfill

on an ongoing basis:

exchange has policies to ensure fair and transparent market conditions at all times and

has processes in place to identify and impede illegal, unfair or manipulative trading

exchange does not impose undue barriers to entry or restrictions on market participants,

and utilizing the venue does not expose market participants to undue credit risk, operational

risk, legal risk or other risks.

exchange complies with applicable law and regulation, including, but not limited to capital

markets regulations, money transmission regulations, client money custody regulations,

know-your-client (KYC) regulations and anti-money-laundering (AML) regulations.

exchange cooperates with inquiries and investigations of regulators and the Administrator

upon request and has to execute data sharing agreements with the CME.

the average daily contribution of a constituent exchange fall below 3%, then the continued inclusion of the venue as a constituent

exchange is assessed by the CME CF Oversight Committee.

transactions from the constituent exchanges that take place during the one-hour calculation window are added to a list, with the

trade price and size for each transaction recorded.

The one-hour calculation is partitioned into twelve intervals of five minutes

each, and for each partition, the volume-weighted median trade price is calculated from the trade prices and sizes of relevant

transactions.

(A volume-weighted median differs from a standard median in that a weighting factor, in this case trade size, is

factored into the calculation.) The BRR is the equally-weighted average of the volume-weighted medians of all twelve partitions.

details on the market share and volume information for each constituent platforms used to calculate the CME CF Bitcoin Reference

table below lists the six constituent platforms that contribute transaction data to the BRR.

It includes the aggregate volumes

traded on their respective Bitcoin - US Dollar markets over the preceding four calendar quarters.

Trading Volume of BTC-USD Markets of CME CF Constituent Platforms**

1,300,217,284

18,606,590,980

12,614,344,809

90,691,419,596

4,117,487,659

17,217,440,706

1,103,291,739

11,280,822,955

12,745,481,874

81,871,129,923

4,460,975,011

15,942,525,422

7,674,154,200

11,788,598,149

58,463,571,028

3,343,922,945

10,944,408,968

1,196,003,201

15,679,729,421

19,041,512,220

106,998,253,547

7,762,251,106

19,039,509,976

Bullish became a CME CF Constituent Platform on December 30th, 2024, and thus its aggregate volume is that observed for 2 days

(December 30th and 31st, 2024).

CF Benchmarks

the 12 highest volume Bitcoin -USD markets operated by spot Bitcoin Trading Platforms, the following table shows the market share

for BTC-USD trading of the seven constituent platforms over the past four calendar quarters:

Trading Platforms Market Share of BTC-USD Trading***

Bullish became a CME CF Constituent Platform on December 30th, 2024, and thus its share is that observed for 2 days (December

30th and 31st, 2024) within the quarter.

Comprises Bitfinex, Crypto.com

CF Benchmarks

Any contingency measures that are

not directly addressed in the Benchmark methodology shall be subject to IMC governance processes.

Sponsor, in its sole discretion, may cause the Fund to track a benchmark other than the Benchmark at any time, with prior notice to investors.

The Sponsor may change the Fund’s benchmark if investment conditions change or the Sponsor believes that another benchmark or standard

better aligns with the Fund’s investment objective and strategy.

The Sponsor, however, is under no obligation whatsoever to make

such a change in any circumstance.

the extent IMC implements a material change to the calculation of the Benchmark, the Sponsor will issue a press release describing such

change and its date of implementation, which press release will be filed with the SEC on Form 8-K.

the extent the Sponsor determines that in the best interest of the Fund to replace the Benchmark with another benchmark reference price

or index, the Sponsor shall issue a press release describing the replacement of the Benchmark and the new benchmark at least 60 days

in advance of such replacement and will file such press release under Form 8-K with the SEC.

Fund’s Investment Strategies

Fund seeks to achieve its investment objective by primarily investing in bitcoin.

The Fund uses Bitcoin Futures Contracts

for the primary purpose of using such Bitcoin Futures Contracts to acquire physical bitcoin through Exchange for Physical

Transactions (“EFP”) transactions and to offset cash and receivables for better tracking of the Benchmark.

normal market conditions, the Fund has a policy to maximize its investments in physical bitcoin such that it is expected that

at least 95% of the Fund’s assets will be invested in bitcoin, and up to 5% may be invested in Bitcoin Futures

Contracts and in cash and cash equivalents, such as short-term Treasury bills, money market funds, and demand deposit

The Sponsor does not have discretion in choosing the Fund’s investments.

See “Use of Proceeds”

The term “normal market conditions” includes, but is not limited to, the absence of:

trading halts in the

applicable financial markets generally;

operational issues (e.g., systems failure) causing dissemination of inaccurate market

or force majeure type events such as natural or man-made disaster, act of God, armed conflict, act of terrorism,

riot or labor disruption or any similar intervening circumstance.

Similarly, the Fund will use bitcoin to acquire Bitcoin

Futures Contracts through EFP transactions, so the Fund can then sell the Bitcoin Futures Contracts for cash in order to

satisfy redemption orders.

percentage allocation to Bitcoin Futures Contracts is determined daily such that the Fund may maintain Bitcoin Futures Contracts

positions (with related cash reserves to meet applicable margin requirements) to hedge the cash balance that the Sponsor deems

necessary to meet the Fund’s liquidity needs for the cash payment of Share redemption settlements and of other applicable

expenses borne by the Fund.

the Fund needs to increase or decrease its allocation to physical bitcoin it will do so through Exchange for Physical Transactions

(“EFP”) transactions, by exchanging a physical bitcoin holding for an equivalent Bitcoin Futures Contracts position.

The Fund’s futures contract positions will be concentrated on the first to expire contracts and rolled on a monthly basis

by closing out the first to expire contracts prior to their final settlement date and then either entering on and EFP transaction

to exchange that position for physical bitcoin holdings or entering into the second to expire contracts which will become the

new first to expire.

A first to expire contract is the contract with the nearest expiration date.

A second to expire contract

follows the first - it is the contract that will expire second in line after the first contract has expired.

For example, when

a first to expire contract expires, the second to expire contract becomes the first to expire contract.

contract rolling will take place on the market business day preceding the last trading day of the first to expire contract.

last trading day of the first to expire contact is currently defined as the last business Friday of each month.

By way of example,

as of the date hereof the Fund’s futures contract positions will be entered and exited according to the roll schedule below.

Bitcoin ETF (DEFI) - Roll Schedule Jan 2025 - Dec 2025

to Expire Contract

factor determining the total return from investing in futures contracts is the price relationship between soon to expire contracts

and later to expire contracts.

Sometimes the Fund will have to pay more for longer maturity contracts to replace existing shorter

maturity contracts about to expire.

This situation is known as “contango” in the futures markets.

In the event of

a prolonged period of contango, and absent the impact of rising or falling bitcoin prices, this could have a negative impact on

the Fund’s NAV and total return, which in turn may have a negative impact on your investment in the Fund.

By way of example,

during the period from 6/30/2020 to 6/30/2023, the market for Bitcoin Futures Contracts were in contango approximately 87% of

the time, which resulted in an average annual negative roll yield of approximately 4.5%.

If the futures market is in a state of

backwardation (i.e., when the price of bitcoin in the future is to be less than the current price), the Fund will buy later to

expire contracts for a lower price than the soon to expire contracts that it sells.

The Fund’s assets consist of bitcoin and cash.

The Fund may hold cash in connection with cash purchases and redemptions of Shares (see “Creation and Redemption of Shares,”

below) and it also will occasionally hold cash for short periods to pay the Sponsor’s Management Fee and any other Fund expenses

and liabilities not assumed by the Sponsor.

The Fund will not hold any assets other than bitcoin and cash.

with applicable provisions of the Trust Agreement and Delaware law, the Fund has broad authority to make changes to the Fund’s

The Fund may change its investment objective, benchmark, or investment strategies and Shareholders of the Fund will

not have any rights with respect to these changes.

The Fund has no current intention to make any such change, and any change is

subject to applicable regulatory requirements, including, but not limited to, any requirement to amend applicable listing rules

of NYSE Arca.

reasons for and circumstances that may trigger any such changes may vary widely and cannot be predicted.

However, by way of example,

the Fund may change the term structure or underlying components of the Bitcoin Futures Contracts holdings in furtherance of the

Fund’s investment objective of tracking the price of the Benchmark, due to market conditions, a potential or actual imposition

of position limits by the SEC, the CFTC or futures exchange rules, or the imposition of risk mitigation measures by a futures

commission merchant, restricts the ability of the Fund to invest in bitcoin or in Bitcoin Futures Contracts.

The Fund would, among

other things, file a current report on Form 8-K and a prospectus supplement to describe any such change and the effective date

of the change.

Shareholders may modify their holdings of the Fund’s Shares in response to any change by purchasing or selling

Fund Shares through their broker-dealer.

Fund invests in bitcoin and Bitcoin Futures Contracts without being leveraged or unable to satisfy its expected current or potential

margin or collateral obligations with respect to its investments.

After fulfilling such margin and collateral requirements, the

Fund invests the remainder of its proceeds from the sale of baskets in short term financial instruments of the type commonly known

as “cash and cash equivalents.”

furtherance of the Fund’s policy to maximize its holdings in bitcoin, the Sponsor will use cash received through the creation

process to purchase Bitcoin Futures Contracts to be exchanged for bitcoin such that at least 95% of the assets of the Fund will

be in bitcoin.

In the extraordinary event that Bitcoin Futures Contracts are unable to be readily exchanged for bitcoin, the Fund

will continue to hold Bitcoin Futures Contracts.

The Sponsor does not have discretion in choosing the Fund’s investments.

See “Use of Proceeds.” The Fund’s investment strategy is designed to permit investors generally to purchase

and sell the Fund’s Shares for the purpose of investing indirectly in the bitcoin market in a cost-effective manner.

Sponsor expects that the Fund’s average daily tracking error against the Benchmark will be less than 10 percent over any

period of 30 trading days.

However, the Fund incurs certain expenses in connection with its operations, which cause imperfect

correlation between changes in the Fund’s NAV and changes in the Benchmark because the Benchmark does not reflect expenses

As a result, investors may incur a partial or complete loss of their investment even when the performance of the Benchmark

The Fund may change its investment objective, benchmark, or investment strategies and shareholders of the Fund will not have

any rights with respect to these changes.

The reasons for and circumstances that may trigger any such changes may vary widely and cannot

be predicted.

The Fund would, among other things, file a current report on Form 8-K and a prospectus supplement to describe any such

change and the effective date of the change.

Shareholders may modify their holdings of the Fund’s Shares in response to any change

by purchasing or selling Fund Shares through their broker-dealer.

Fund’s investment objective is for changes in the Shares’ NAV to reflect the daily changes of the price of the Benchmark,

less expenses from the Fund’s operations.

In furtherance of the Fund’s policy to maximize its holdings in bitcoin, the Sponsor

will use cash received through the creation process to purchase bitcoin.

The Sponsor does not have discretion in choosing the Fund’s

The Fund’s investment strategy is designed to permit investors generally to purchase and sell the Fund’s Shares

for the purpose of investing indirectly in the bitcoin market in a cost-effective manner.

The Sponsor expects that the Fund’s average

daily tracking error against the Benchmark will be less than 10 percent over any period of 30 trading days.

However, the Fund incurs

certain expenses in connection with its operations, which cause imperfect correlation between changes in the Fund’s NAV and changes

in the Benchmark because the Benchmark does not reflect expenses or income.

As a result, investors may incur a partial or complete loss

of their investment even when the performance of the Benchmark is positive.

may purchase and sell Shares through their broker-dealers.

However, the Fund creates and redeems Shares only in blocks called

Creation Baskets and Redemption Baskets, respectively, and only Authorized Purchasers may purchase or redeem Creation Baskets

or Redemption Baskets.

An Authorized Purchaser is under no obligation to create or redeem baskets, and an Authorized Purchaser

is under no obligation to offer to the public Shares of any baskets it does create.

Baskets are generally created when there is

a demand for Shares, including, but not limited to, when the market price per Share is at (or perceived to be at) a premium to

However, the Fund creates and redeems Shares only in Baskets and only Authorized

Purchasers may purchase or redeem Baskets.

An Authorized Purchaser is under no obligation to create or redeem Baskets, and an Authorized

Purchaser is under no obligation to offer to the public Shares of any Baskets it does create.

Baskets are generally created when there

is a demand for Shares, including, but not limited to, when the market price per Share is at (or perceived to be at) a premium to the

NAV per Share.

Similarly, Baskets are generally redeemed when the market price per Share is at (or perceived to be at) a discount to

the NAV per Share.

Similarly, baskets are generally redeemed when the market price per Share is at (or perceived to be at) a discount

to the NAV per Share.

Retail investors seeking to purchase or sell Shares on any day are expected to affect such transactions

in the secondary market, on NYSE Arca, at the market price per Share, rather than in connection with the creation or redemption

Sponsor believes that by investing in bitcoin and Bitcoin Futures Contracts, the Fund’s NAV will closely track the Benchmark.

The Sponsor also believes that because of market arbitrage opportunities, the market price at which investors will purchase and

sell Shares through their broker-dealer will closely track the Fund’s NAV.

The Sponsor believes that the net effect of these

relationships is that the Fund’s market price on NYSE Arca at which investors purchase and sell Shares will closely track

the bitcoin market, as measured by the Benchmark.

CFTC and U.S.

designated contract markets, such as the CME, have established position limits and accountability levels on the

maximum net long or net short Bitcoin Futures Contracts that the Fund may hold, own or control.

The current CME established position

limit level for investments in BTC Contracts for the spot month is 4,000 contracts.

A position accountability level of 5,000 contracts

will be applied to positions in single months outside the spot month and in all months combined.

The MBT Contracts have a spot

month limit of 200,000 contracts and a position accountability level of 250,000 contracts.

Open positions in MBT Contracts will

count as 1/50 of a BTC Contract for the purposes of determining the aggregate position limit.

Accountability levels are not fixed

ceilings but rather thresholds above which the exchange may exercise greater scrutiny and control over an investor, including

limiting the Fund to holding no more Bitcoin Futures Contracts than the amount established by the accountability levels.

The potential

for the Fund to reach position or accountability limits will depend on if and how quickly the Fund’s net assets increase.

addition to position limits and accountability limits, the CME and other exchanges have set dynamic price fluctuation limits on

Bitcoin Futures Contracts.

The dynamic price limit functionality under the special price fluctuation limits mechanism assigns

a price limit variant which equals a percentage of the prior trading day’s settlement price, or a price deemed appropriate.

During the trading day, the dynamic variant is utilized in continuous rolling 60-minute look-back periods to establish dynamic

upper and lower price fluctuation limits.

Once the dynamic price fluctuation limit has been reached in a particular Bitcoin Futures

Contract, no trades may be made at a price beyond that limit.

The CME has adopted daily dynamic price fluctuation limit functionality

effective March 11, 2019, specifically, Rule 589 which is found in the following link:

https://www.cmegroup.com/content/dam/cmegroup/notices/ser/2019/03/SER-8351.pdf.

Since dynamic price fluctuation limits were introduced, price limits have been triggered 89 times and there has been one “hard

limit move.” A hard limit move is when the price of Bitcoin Futures Contracts exceeds a price limit that defines the minimum/maximum

price to which such Bitcoin Futures Contracts can move for the given trade date.

If the hard limit is reached, trade matching

will not occur at prices above the maximum price or below the minimum price.

determining the value of Bitcoin Futures Contracts, U.S.

Bank Global Fund Services (“Global Fund Services”), the Fund’s

“Sub-Administrator,” uses primarily the settlement price for the Bitcoin Futures Contracts, as reported on the CME.

CME Group staff determines the daily settlements for the Bitcoin Futures Contracts based on trading activity on CME Globex exchange

between 14:59:00 and 15:00:00 Central Time (CT), the settlement period.

In situations where a two-sided market is not available

during the closing period, the CME will derive a settlement price using the carry calculation method based on the CME CF Bitcoin

Reference Rate (BRR).

This method calculates the settlement price as the reference rate plus an adjustment factoring in the days

to expiration and the interest rate.

Specifically, the settlement price is determined by the formula:

BRR + [(Days to Expiration

/ 365) × Interest Rate × BRR].

When a Bitcoin Futures Contracts has closed at its daily price fluctuation limit, that

limit price will be the daily settlement price that the CME publishes.

exceptional circumstances when:

(i) Bitcoin Futures Contracts settlement prices are not readily available;

or (ii) when a trading

halt closes CME or the Bitcoin Futures Market early, including if trading were halted for an entire trading day or several trading

or (iii) when a Bitcoin Futures Contracts close at its price fluctuation limit for the day, the fair value of such contracts

are determined by the Sponsor in good faith and in a manner that assesses the Bitcoin Futures Contracts’ value based on

a consideration of all available facts and all available information on the valuation date.

The fair value of Bitcoin Futures

Contracts is determined by attempting to estimate the price at which such Bitcoin Futures Contract would be trading in the absence

of the price fluctuation limit (either above such limit when an upward limit has been reached or below such limit when a downward

limit has been reached).

Typically, this estimate will be made primarily using a carry calculation described above that uses the

BRR at 4:00 p.m.

on settlement day as a reference price.

The fair value of BTC Contracts and MBT Contracts may not reflect

such investments’ market value or the amount that the Fund might reasonably expect to receive for the BTC Contracts and

MBT Contracts upon its current sale.

limits, accountability limits and dynamic price fluctuation limits may limit the Fund’s ability to invest the proceeds of

Creation Baskets in bitcoin or Bitcoin Futures Contracts.

As a result, when the Fund offers to sell Creation Baskets it may be

limited in its ability to invest in bitcoin or Bitcoin Futures Contracts.

The Fund may hold larger amounts of cash and cash equivalents,

which will impair the Fund’s ability to meet its investment objective of tracking the Benchmark.

Retail investors seeking to purchase or sell Shares on any day are expected to affect such transactions in the secondary

market, on NYSE Arca, at the market price per Share, rather than in connection with the creation or redemption of Baskets.

Sponsor believes that by investing in bitcoin, the Fund’s NAV closely tracks the Benchmark.

The Sponsor also believes that because

of market arbitrage opportunities, the market price at which investors purchase and sell Shares through their broker-dealer will closely

track the Fund’s NAV.

The Sponsor believes that the net effect of these relationships is that the Fund’s market price on

NYSE Arca at which investors purchase and sell Shares will closely track the bitcoin market, as measured by the Benchmark.

is a minimum number of Baskets and associated Shares specified for the Fund.

If the Fund experiences redemptions that cause the

number of Shares outstanding to decrease to the minimum level of Shares required to be outstanding, until the minimum number of

Shares is again exceeded through the purchase of a new Creation Basket, there can be no more redemptions by an Authorized Purchaser.

In such cases, market makers may be less willing to purchase Shares from investors in the secondary market, which may in turn

limit the ability of Shareholders of the Fund to sell their Shares in the secondary market.

These minimum levels for the Fund

are 50,000 Shares, representing five baskets.

If the Fund experiences redemptions that cause the number

of Shares outstanding to decrease to the minimum level of Shares required to be outstanding, until the minimum number of Shares is again

exceeded through the purchase of a new Basket, there can be no more redemptions by an Authorized Purchaser.

In such cases, market makers

may be less willing to purchase Shares from investors in the secondary market, which may in turn limit the ability of shareholders of

the Fund to sell their Shares in the secondary market.

These minimum levels for the Fund are 50,000 Shares, representing five Baskets.

The minimum level of Shares specified for the Fund is subject to change.

The Bitcoin Industry

Sponsor maintains a public website on behalf of the Fund, https://hashdex-etfs.com/defi, which contains information about the Trust,

the Fund, and the Shares.

Fund’s Investments in Bitcoin

Fund’s investment strategy includes direct investments in bitcoin, commonly referred to as “spot bitcoin”.

Fund sells or redeems its Shares, bitcoin will be transferred into or out of the Fund, as applicable, in exchange for Baskets that are

based on the quantity of bitcoin attributable to each Share of the Fund (net of accrued but unpaid Management Fees and any accrued but

unpaid extraordinary expenses or liabilities).

Fund will create Shares in cash by receiving bitcoin from a third party that is not the Authorized Purchaser and the Fund is responsible

for selecting the third party to deliver the bitcoin.

Further, the third party will not be acting as an agent of the Authorized Purchaser

with respect to the delivery of the bitcoin to the Fund or acting at the direction of the Authorized Purchaser with respect to the delivery

of the bitcoin to the Fund.

The Fund will redeem the Shares in cash by delivering bitcoin to a third party that is not the Authorized

Purchaser and the Fund is responsible for selecting the third party to receive the bitcoin.

Further, the third party will not be acting

as an agent of the Authorized Purchaser with respect to the receipt of the bitcoin from the Fund or acting at the direction of the Authorized

Purchaser with respect to the receipt of the bitcoin from the Fund.

The third party will be unaffiliated with the Fund and the Sponsor.

Purchasers may also purchase Shares in-kind.

To purchase Shares in-kind, an Authorized Purchaser delivers, or arranges for the delivery

by the Authorized Purchaser’s designated agent or client, of bitcoin to the Fund’s account with the Bitcoin Custodian in

exchange for Shares.

Authorized Purchasers may also redeem Shares in-kind.

When such an Authorized Purchaser redeems Shares in-kind,

the Fund, through the Bitcoin Custodian, will deliver bitcoin to the Authorized Purchaser, or a designated agent or client thereof, in

exchange for its Shares.

Bitcoin Industry

is a digital asset that serves as the unit of account on an open-source, decentralized, peer-to-peer computer network.

may be used to pay for goods and services, stored for future use, or converted to a fiat currency.

As of the date of this update,

the adoption of bitcoin for these purposes has been limited.

The value of bitcoin is not backed by any government, corporation,

or other identified body.

value of bitcoin is determined in part by the supply of (which is limited), and demand for, bitcoin in the markets for exchange

that have been organized to facilitate the trading of bitcoin.

Bitcoin may be

used to pay for goods and services, stored for future use, or converted to a fiat currency.

As of the date of this update, the adoption

of bitcoin for these purposes has been limited.

The value of bitcoin is not backed by any government, corporation, or other identified

value of bitcoin is determined in part by the supply of (which is limited), and demand for, bitcoin in the markets for exchange that

have been organized to facilitate the trading of bitcoin.

By design, the supply of bitcoin is limited to 21 million bitcoins.

As of the date of this update, there are approximately 19 million bitcoins in circulation.

date of this update, there are approximately 19 million bitcoins in circulation.

is maintained on the Bitcoin Network.

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software and governs bitcoin’s creation and movement.

The source code for the Bitcoin Network, often referred to as the

Bitcoin Protocol, is open-source, and anyone can contribute to its development.

movements for bitcoin are influenced by, among other things, the environment, natural or man-made disasters, governmental oversight

and regulation, demographics, economic conditions, infrastructure limitations, existing and future technological developments,

and a variety of other factors now known and unknown, any and all of which can have an impact on the supply, demand, and price

fluctuations in the bitcoin markets.

More generally, cryptocurrency prices may be influenced by economic and monetary events such

as changes in interest rates, changes in balances of payments and trade, U.S.

and international inflation rates, currency valuations

and devaluations, U.S.

The source code for the Bitcoin Network, often referred to as the Bitcoin

Protocol, is open-source, and anyone can contribute to its development.

movements for bitcoin are influenced by, among other things, the environment, natural or man-made disasters, governmental oversight and

regulation, demographics, economic conditions, infrastructure limitations, existing and future technological developments, and a variety

of other factors now known and unknown, any and all of which can have an impact on the supply, demand, and price fluctuations in the

bitcoin markets.

More generally, cryptocurrency prices may be influenced by economic and monetary events such as changes in interest

rates, changes in balances of payments and trade, U.S.

and international inflation rates, currency valuations and devaluations, U.S.

and international economic events, and changes in the philosophies and emotions of market purchasers.

the Predecessor Fund invested in futures contracts in a single cryptocurrency, it was not a diversified investment vehicle, and

therefore may have been subject to greater volatility than a diversified portfolio of stocks or bonds or a more diversified commodity

or cryptocurrency pool.

Likewise, because the Fund invests in spot bitcoin and futures contracts in a single cryptocurrency, it

is not a diversified investment vehicle, and therefore may be subject to greater volatility than a diversified portfolio of stocks

or bonds or a more diversified commodity or cryptocurrency pool.

Because the Predecessor Fund invested

in futures contracts in a single cryptocurrency, it was not a diversified investment vehicle, and therefore may have been subject to

greater volatility than a diversified portfolio of stocks or bonds or a more diversified commodity or cryptocurrency pool.

because the Fund invests in spot bitcoin and futures contracts in a single cryptocurrency, it is not a diversified investment vehicle,

and therefore may be subject to greater volatility than a diversified portfolio of stocks or bonds or a more diversified commodity or

cryptocurrency pool.

Bitcoin Network

infrastructure of the Bitcoin Network is collectively maintained by participants in the Bitcoin Network, which include miners,

developers, and users.

infrastructure of the Bitcoin Network is collectively maintained by participants in the Bitcoin Network, which include miners, developers,

Miners validate transactions and are currently compensated for that service in bitcoin.

Developers maintain

and contribute updates to the Bitcoin Network’s source code, often referred to as the Bitcoin Protocol.

Users access the

Bitcoin Network using open-source software.

Developers maintain and contribute

updates to the Bitcoin Network’s source code, often referred to as the Bitcoin Protocol.

Users access the Bitcoin Network using

open-source software.

Anyone can be a user, developer, or miner.

is “stored” on a digital transaction ledger commonly known as a “blockchain.” A blockchain is a type of

shared and continually reconciled database, stored in a decentralized manner on the computers of certain users of the digital

asset and is protected by cryptography.

is “stored” on a digital transaction ledger commonly known as a “blockchain.” A blockchain is a type of shared

and continually reconciled database, stored in a decentralized manner on the computers of certain users of the digital asset and is protected

by cryptography.

The Bitcoin Blockchain contains a record and history for each bitcoin transaction.

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to the Bitcoin Blockchain.

The new block is then confirmed through acceptance by a majority of users who maintain versions of

the blockchain on their individual computers.

Miners that successfully add a block to the Bitcoin Blockchain are automatically

rewarded with a fixed amount of bitcoin for their effort plus any transaction fees paid by transferors whose transactions are

recorded in the block.

This reward system is the means by which new bitcoin enter circulation and is the mechanism by which versions

of the blockchain held by users on a decentralized network are kept in consensus.

The new block is then confirmed through acceptance by a majority of users who maintain versions of the blockchain

on their individual computers.

Miners that successfully add a block to the Bitcoin Blockchain are automatically rewarded with a fixed

amount of bitcoin for their effort plus any transaction fees paid by transferors whose transactions are recorded in the block.

system is the means by which new bitcoin enter circulation and is the mechanism by which versions of the blockchain held by users on

a decentralized network are kept in consensus.

Bitcoin Protocol

Bitcoin Protocol is an open source project with no official company or group in control.

Anyone can review the underlying code

and suggest changes.

There are, however, a number of individual developers that regularly contribute to a specific distribution

of bitcoin software known as the “Bitcoin Core.” Developers of the Bitcoin Core loosely oversee the development of

the source code.

There are many other compatible versions of the bitcoin software, but Bitcoin Core is the most widely adopted

and currently provides the de facto standard for the Bitcoin Protocol.

The core developers are able to access, and can alter,

the Bitcoin Network source code and, as a result, they are responsible for quasi-official releases of updates and other changes

to the Bitcoin Network’s source code.

because bitcoin has no central authority, the release of updates to the Bitcoin Network’s source code by the core developers

does not guarantee that the updates will be automatically adopted by the other purchasers.

Users and miners must accept any changes

made to the source code by downloading the proposed modification and that modification is effective only with respect to those

bitcoin users and miners who choose to download it.

As a practical matter, a modification to the source code becomes part of the

Bitcoin Network only if it is accepted by participants that collectively have a majority of the processing power on the Bitcoin

If a modification is accepted by only a percentage of users and miners, a division will occur such that one network will

run the pre-modification source code and the other network will run the modified source code.

Anyone can review the underlying code and suggest

There are, however, a number of individual developers that regularly contribute to a specific distribution of bitcoin software

known as the “Bitcoin Core.” Developers of the Bitcoin Core loosely oversee the development of the source code.

many other compatible versions of the bitcoin software, but Bitcoin Core is the most widely adopted and currently provides the de facto

standard for the Bitcoin Protocol.

The core developers are able to access, and can alter, the Bitcoin Network source code and, as a result,

they are responsible for quasi-official releases of updates and other changes to the Bitcoin Network’s source code.

because bitcoin has no central authority, the release of updates to the Bitcoin Network’s source code by the core developers does

not guarantee that the updates will be automatically adopted by the other purchasers.

Users and miners must accept any changes made to

the source code by downloading the proposed modification and that modification is effective only with respect to those bitcoin users

and miners who choose to download it.

As a practical matter, a modification to the source code becomes part of the Bitcoin Network only

if it is accepted by participants that collectively have a majority of the processing power on the Bitcoin Network.

If a modification

is accepted by only a percentage of users and miners, a division will occur such that one network will run the pre-modification source

code and the other network will run the modified source code.

Such a division is known as a “fork.”

Sponsor ’ s Operations

the Trust Agreement, the Sponsor is solely responsible for management and conducts or directs the conduct of the business of the

Trust, the Fund, and any series of the Trust that may from time to time be established and designated by the Sponsor.

is required to oversee the purchase and sale of Shares by Authorized Purchasers and to manage the Fund’s investments, including

to evaluate the credit risk of FCMs and swap counterparties and to review daily positions and margin/collateral requirements.

The Sponsor has the power to enter into agreements as may be necessary or appropriate for the offer and sale of the Fund’s

Shares and the conduct of the Trust’s activities.

Accordingly, the Sponsor is responsible for selecting the Trustee, Administrator,

Marketing Agent, the independent registered public accounting firm of the Trust, and any legal counsel employed by the Trust.

The Sponsor is also responsible for preparing and filing periodic reports on behalf of the Trust with the SEC and will provide

any required certification for such reports.

the Trust Agreement, the Sponsor is solely responsible for management and conducts or directs the conduct of the business of the Trust,

the Fund, and any series of the Trust that may from time to time be established and designated by the Sponsor.

The Sponsor is required

to oversee the purchase and sale of Shares by Authorized Purchasers and to manage the Fund’s investments.

The Sponsor has the power

to enter into agreements as may be necessary or appropriate for the offer and sale of the Fund’s Shares and the conduct of the

Trust’s activities.

Accordingly, the Sponsor is responsible for selecting the Trustee (as defined below), Administrator (as defined

below), Marketing Agent (as defined below), the independent registered public accounting firm of the Trust, and any legal counsel employed

by the Trust.

The Sponsor is also responsible for preparing and filing periodic reports on behalf of the Trust with the SEC and will

provide any required certification for such reports.

The Sponsor may determine to engage marketing agents who will assist the Sponsor

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See “Plan of Distribution” below for more information.

The Sponsor has discretion to appoint

one or more of its affiliates as additional Sponsors.

No person other than the Sponsor and its principals was involved in the

organization of the Trust or the Fund.

The Sponsor maintains a public website on behalf of the Fund, which contains information

about the Trust, the Fund, and the Shares, and oversees certain services for the benefit of Shareholders.

Please note that information

contained on or accessible through the Sponsor’s website is not considered part of this Annual Report.

The Sponsor has discretion to appoint one

or more of its affiliates as additional sponsors.

No person other than the Sponsor and its principals was involved in the organization

of the Trust or the Fund.

The Sponsor maintains a public website on behalf of the Fund, https://hashdex-etfs.com/defi, which contains

information about the Trust, the Fund, and the Shares, and oversees certain services for the benefit of shareholders.

Please note that

information contained on or accessible through the Sponsor’s website is not considered part of this Annual Report on Form 10-K

(the “Annual Report”).

Fund pays the Sponsor a Management Fee, monthly in arrears, in an amount equal to 0.25% per annum of the daily NAV of the Fund.

(the “Management Fee”).

The Management Fee is paid in consideration of the Sponsor’s services related to the

management of the Fund’s business and affairs, including the provision of commodity futures trading advisory services.

Fund is newly organized and as of the date of this Annual Report has not paid any management fees to the Sponsor.

pays all of the routine operational, administrative and other ordinary expenses of the Fund, generally as determined by the Sponsor,

including but not limited to, fees and expenses of the Tidal ETF Services LLC (the “Administrator”), the Sub-Administrator,

Custodians, marketing agent, transfer agent, licensors, accounting and audit fees and expenses, tax preparation expenses, legal

fees, ongoing SEC registration fees, individual Schedule K-1 preparation and mailing fees, and report preparation and mailing

The Management

Fee is paid in consideration of the Sponsor’s services related to the management of the Fund’s business and affairs.

addition to the Fund’s Management Fee, the Fund pays all of its respective brokerage commissions, including financing fees, Bitcoin

Network fees and similar transaction fees and expenses charged in connection with trading activities.

The Fund also pays all fees and

commissions related to the sale and purchase of spot bitcoin, including any bitcoin transaction fees for on-chain transfers of bitcoin.

Creations with cash may cause the Fund to incur certain costs, including brokerage commissions, and redemptions of Baskets with cash

may result in the recognition of gains or losses that the Fund might not have incurred if it had made redemptions in-kind.

pays all of the other routine operational, administrative and other ordinary expenses of the Fund, generally as determined by the Sponsor,

including but not limited to, fees and expenses of the Administrator, Custodians, Marketing Agent, Transfer Agent (as defined below),

licensors, accounting and audit fees and expenses, tax preparation expenses, legal fees, ongoing SEC registration fees, individual Schedule

K-1 preparation and mailing fees, and report preparation and mailing expenses.

The Fund pays all of its non-recurring and unusual fees

and expenses, if any, as determined by the Sponsor.

Non-recurring and unusual fees and expenses are unexpected or unusual in nature,

such as legal claims and liabilities and litigation costs or indemnification or other unanticipated expenses.

Extraordinary fees and

expenses also include material expenses which are not currently anticipated obligations of the Fund.

Routine operational, administrative

and other ordinary expenses are not deemed extraordinary expenses.

In the event the Trust’s cash balance is insufficient to pay

all fees and expenses, including the Management Fee, the Trust may need to sell crypto assets from time to time to pay for its fees and

expenses, and up to $250,000 per annum in ordinary legal fees and expenses.

The Sponsor may determine in its sole discretion to assume

legal fees and expenses of the Trust in excess of $250,000 per annum.

The Sponsor may determine in its sole discretion to assume any

non-recurring and unusual fees and expenses of the Trust, if applicable.

To the extent that the Sponsor does not voluntarily assume such

fees and expenses, they will be the responsibility of the Trust.

have no right to elect the Sponsor on an annual or any other continuing basis or to remove the Sponsor.

If the Sponsor voluntarily

withdraws, the holders of a majority of the Trust’s outstanding Shares (excluding for purposes of such determination Shares

owned by the withdrawing Sponsor and its affiliates) may elect its successor.

Prior to withdrawing, the Sponsor must give ninety

days’ written notice to the Shareholders and the Trustee.

Sponsor is majority owned and controlled by Mr.

Guillermo Trias, Mr.

Michael Venuto, and FTV-Toroso, Inc,.

a non-officer member,

who have all provided working capital to the Sponsor.

Trias and Venuto each currently own, directly or indirectly, 15%

of the Sponsor while FTV-Toroso, Inc., a non-officer member holds approximately 37.15% of the Sponsor (but only 24.9% of Sponsor’s

voting units).

FTV-Toroso, Inc.

is controlled by FTV VI, L.P.

and Michael Vostrizansky is the voting member of FTV VI, L.P.

Administrator is a wholly-owned subsidiary and affiliate of the Sponsor.

If the Sponsor voluntarily withdraws,

the holders of a majority of the Trust’s outstanding Shares (excluding, for purposes of such determination, Shares owned by the

withdrawing Sponsor and its affiliates) may elect its successor.

Prior to withdrawing, the Sponsor must give ninety days’ written

notice to the shareholders and the Trustee.

Sponsor has an information security program and policy in place.

The program takes reasonable care to look beyond the security

and controls developed and implemented for the Trust and the Fund directly to the platforms and controls in place for the key

service providers.

Such review of cybersecurity and information technology plans of key service providers are part of the Sponsor’s

disaster recovery and business continuity planning.

The Sponsor provides regular training to all employees of the Sponsor regarding

cybersecurity topics, in addition to real-time dissemination of information regarding cybersecurity matters as needed.

The information

security plan is reviewed and updated as needed, but at a minimum on an annual basis.

The program takes reasonable care to look beyond the security and controls

developed and implemented for the Trust and the Fund directly to the platforms and controls in place for the key service providers.

review of cybersecurity and information technology plans of key service providers are part of the Sponsor’s disaster recovery and

business continuity planning.

The Sponsor provides regular training to all employees of the Sponsor regarding cybersecurity topics, in

addition to real-time dissemination of information regarding cybersecurity matters as needed.

The information security plan is reviewed

and updated as needed, but at a minimum on an annual basis.

Fund’s Service Providers

Sponsor is responsible for investing the assets of the Fund in accordance with the objectives and policies of the Fund.

the Sponsor arranges for one or more third parties to provide administrative, custodial, accounting, transfer agency and other

necessary services to the Fund.

the Sponsor arranges for one or more third parties to provide administrative, custodial, accounting, transfer agency and other necessary

services to the Fund.

For these third-party services, the Fund pays the fees set forth in the table below entitled “Contractual

Fees and Compensation Arrangements with the Sponsor and Third-Party Service Providers.” For the Sponsor’s services,

the Fund is contractually obligated to pay a monthly Management Fee to the Sponsor.

Fees and Compensation Arrangements with the Sponsor and Third-Party Service Providers.” For the Sponsor’s services, the Fund

is contractually obligated to pay a monthly Management Fee to the Sponsor.

Sponsor acts as the Trust’s sponsor pursuant to the terms of the Trust Agreement.

Under the Trust Agreement, the Sponsor acts as

an agent of the Trust and is solely responsible for the conduct of the Trust’s business.

Sponsor serves as the sponsor, investment manager, or investment adviser to investment vehicles other than the Trust.

As of December

31, 2025, the Sponsor serves as sponsor, investment manager, or investment adviser to over 9 pooled investment vehicles across multiple

jurisdictions, including investment strategies relating to crypto asset markets.

As of December 31, 2025, the Sponsor is responsible

for approximately $1.2 billion in assets under management.

As a result, conflicts of interest may arise between the Sponsor’s responsibilities

to the Trust on the one hand and, on the other, the responsibilities the Sponsor owes to those other pooled investment vehicles for which

it serves as sponsor, investment manager, or investment adviser.

Such conflicts may include, but are not limited to, the allocation of

investment opportunities.

If the Sponsor acquires knowledge of a potential transaction or arrangement that may be an opportunity for

the Trust, it shall have no duty to offer such opportunity to the Trust, and the Sponsor will not be liable to the Trust or the shareholders

for breach of any fiduciary or other duty if the Sponsor pursues such opportunity or directs it to another person or does not communicate

such opportunity to the Trust and is not required to share income or profits derived from such business ventures with the Trust.

Administrator

Fund employs Tidal ETF Services LLC as the Fund’s administrator (the “Administrator”).

In turn, the Administrator

has engaged U.S.

Bancorp Fund Services, LLC, doing business as U.S.

Bank Global Fund Services (“Global Fund Services”)

to act as sub-administrator.

The Administrator is a wholly-owned subsidiary of Sponsor.

The Administrator is located at 234 West

Florida Street, Suite 203, Milwaukee, Wisconsin 53204.

The Administrator also assists the Fund and the Sponsor with certain functions

and duties relating to marketing, which include the following:

marketing and sales strategy, and marketing related services.

Custodian, Registrar, Transfer Agent, Fund Sub-Administrator

its capacity as the Fund’s custodian, the Custodian, currently U.S.

Bank, N.A., holds the Fund’s securities, cash

and/or cash equivalents pursuant to a custodial agreement.

Fund employs U.S.

Bancorp Fund Services, LLC (d/b/a U.S.

Bank Global Fund Services (“Global Fund Services”)) as the Fund’s

administrator (the “Administrator”).

The Administrator is located at 615 East Michigan Street, Milwaukee, Wisconsin 53202.

Custodian, Registrar, Transfer Agent

its capacity as the Cash Custodian, U.S.

holds the Fund’s cash and/or cash equivalents pursuant to a custodial agreement.

Global Fund Services, an entity affiliated with U.S.

Bank, N.A., is

the registrar and transfer agent for the Fund’s Shares.

In addition, Global Fund Services also serves as sub- administrator

for the Fund, performing certain sub-administrative, and accounting services, and support in preparing certain SEC and CFTC reports

on behalf of the Fund.

The Custodian is located at 1555 North Rivercenter Drive, Suite 302, Milwaukee, Wisconsin 53212.

is a nationally chartered bank, regulated by the Office of the Comptroller of the Currency, Department of the Treasury, and

is subject to regulation by the Board of Governors of the Federal Reserve System.

The principal address for Global Fund Services

is 615 East Michigan Street, Milwaukee, WI, 53202.

of the Fund can also consist of bitcoin.

Such investments are held by BitGo Trust Company, Inc.

(the “Bitcoin Custodian”)

on behalf of the Fund.

The Bitcoin Custodian will keep custody of all of the Fund’s bitcoin in a multi-layer, multi-party

cold storage or similarly secure technology.

The Bitcoin Custodian is responsible for safekeeping passwords, keys or phrases that

allow transfers of digital assets (“Security Factors”) safe, secure and confidential.

100% of the private keys will

be held in cold storage.

The Bitcoin Custodian will establish the Bitcoin Accounts on the Bitcoin Network solely for the Fund.

The Bitcoin Custodian will follow valid instructions given by the Sponsor to use the Fund’s Security Factors to effect transfers

to and from the Bitcoin Accounts.

The Fund’s bitcoin will be held in segregated wallets and will not be commingled with

the assets of other customers.

The Bitcoin Custodian has an insurance policy that covers, at least partially, risks such as the

loss of client assets held in cold storage, including from employee collusion or fraud, physical loss including theft, damage

of key material, security breach or hack, and fraudulent transfer.

Fund employs Foreside Fund Services, LLC, a wholly-owned subsidiary of Foreside Financial Group, LLC (d/b/a ACA Group) as the

Marketing Agent for the Fund.

The Marketing Agent Agreement among the Marketing Agent and the Trust calls for the Marketing Agent

to work with the Custodian in connection with the receipt and processing of orders for Creation Baskets and Redemption Baskets

and the review and approval of all Fund sales literature and advertising material.

The Marketing Agent’s principal business

address is Three Canal Plaza, Suite 100, Portland, Maine 04101.

The Marketing Agent is a broker-dealer registered with the SEC

and a member of FINRA.

Administrator also assists the Fund and the Sponsor with certain functions and duties relating to administration and marketing,

which include the following:

marketing and sales strategy and marketing related services.

Asset Adviser

Asset Management Ltd.

(“Hashdex” or the “Digital Asset Adviser”) is a Cayman Islands investment manager

(and an Exempt Reporting Advisor under SEC rules) that specializes in, among other things, the management, research, investment

analysis and other investment support services of funds and ETFs with investment strategies involving bitcoin and other crypto

As Digital Asset Adviser, Hashdex is responsible for providing the Sponsor and the Administrator with research and analysis

regarding bitcoin and bitcoin markets for use in the operation and marketing of the Fund.

Hashdex has no role in maintaining,

calculating or publishing the Benchmark.

Hashdex also has no responsibility for the investment or management of the Fund’s

portfolio or for the overall performance or operation of the Fund.

Sponsor, Administrator, Digital Asset Adviser and the Prior Sponsor (collectively, the “Parties”) have entered into

an agreement, as amended (the “Support Agreement”) that sets forth the terms and conditions applicable to the launch,

marketing, promotion, development, and ongoing operation of the Predecessor Fund and the Fund, as well the respective rights in

profits and obligations for expenses.

Specifically, Hashdex and the Sponsor have experience in the digital asset and exchange-traded

fund industry, and seek to offer a bitcoin based fund as part of their long-term business goals.

primary responsibilities and rights of each Party under the Support Agreement, with respect to the Fund, are described below:

Sponsor serves as the sponsor of the Fund as a series of the Trust, as described in this

Annual Report.

Administrator provides fund administration and related services for the Fund.

provides to the Sponsor research and analysis regarding bitcoin and bitcoin markets for

use in the operation and marketing of the Fund.

a deduction of operational costs from the Management Fee, the resulting profits and losses

will be shared equally among the Sponsor and Hashdex.

From the Management Fee, the Sponsor

will pay all of the routine operational, administrative and other ordinary expenses of

the Fund, generally as determined by the sub-administrator, including but not limited

to, fees and expenses of the sub-administrator, Custodian, Marketing Agent, Transfer

Agent, licensors, accounting and audit fees expenses, tax preparation expenses, legal

fees, ongoing SEC registration fees, individual Schedule K-1 preparation and mailing

fees, and report preparation and mailing expenses.

sole Trustee of the Trust is Wilmington Trust, a national banking association.

The Trustee’s principal offices are located

at 1100 North Market Street, Wilmington, Delaware 19890-0001.

Bank, N.A., is the registrar and transfer agent for the Fund’s Shares (the

“Transfer Agent”).

Cash Custodian is located at 1555 North Rivercenter Drive, Suite 302, Milwaukee, Wisconsin 53212.

is a nationally chartered

bank, regulated by the Office of the Comptroller of the Currency, Department of the Treasury, and is subject to regulation by the Board

of Governors of the Federal Reserve System.

The principal address for the Transfer Agent is 615 East Michigan Street, Milwaukee, WI,

Fund’s bitcoin investments are held by BitGo Trust Company, Inc., as the Fund’s Bitcoin Custodian, on behalf of the Fund.

The Bitcoin Custodian will keep custody of all of the Fund’s bitcoin in a multi-layer, multi-party cold storage or similarly secure

The Bitcoin Custodian is responsible for safekeeping passwords, keys or phrases (the “Security Factors”) that

allow transfers of digital assets to be safe, secure and confidential.

100% of the private keys will be held in cold storage.

Custodian will establish the Bitcoin Accounts (as defined below) on the Bitcoin Network solely for the Fund.

The Bitcoin Custodian will

follow valid instructions given by the Sponsor to use the Fund’s Security Factors to effect transfers to and from the Bitcoin Accounts.

The Fund’s bitcoin will be held in segregated wallets and will not be commingled with the assets of other customers.

Custodian has insurance policies that cover, at least partially, risks such as the loss of client assets held in cold storage, including

from employee collusion or fraud, physical loss including theft, damage of key material, security breach or hack, and fraudulent transfer.

Fund employs Paralel Distributors LLC as the marketing agent for the Fund (the “Marketing Agent”).

The Marketing Agent Agreement

among the Marketing Agent, the Sponsor, and the Trust calls for the Marketing Agent to work with the Cash Custodian in connection with

the receipt and processing of orders for the creation and redemption of Baskets and to review and approve of all Fund sales literature

and advertising material.

The Marketing Agent’s principal business address is 1700 Broadway, Suite 1850, Denver CO 80290.

The Marketing

Agent is a broker-dealer registered with the SEC and a member of the Financial Industry Regulatory Authority (“FINRA”).

sole trustee (the “Trustee”) of the Trust is Wilmington Trust, a national banking association.

The Trustee’s principal

offices are located at 1100 North Market Street, Wilmington, Delaware 19890-0001.

The Trustee is unaffiliated with the Sponsor.

The Trustee’s

duties and liabilities with respect to the offering of Shares and the management of the Trust and the Fund are limited to its

express obligations under the Trust Agreement.

Trustee will accept service of legal process on the Trust in the State of Delaware and will make certain filings under the Delaware

Statutory Trust Act.

duties and liabilities with respect to the offering of Shares and the management of the Trust and the Fund are limited to its express

obligations under the Trust Agreement.

Trustee will accept service of legal process on the Trust in the State of Delaware and will make certain filings under the Delaware Statutory

Trust Act (“DSTA”).

The Trustee does not owe any other duties to the Trust, the Sponsor or the shareholders.

The Trustee is permitted

to resign upon at least sixty (60) days’ notice to the Sponsor.

If no successor trustee has been appointed by the Sponsor

within such sixty-day period, the Trustee may, at the expense of the Trust, petition a court to appoint a successor.

Agreement provides that the Trustee is entitled to reasonable compensation for its services from the Sponsor or an affiliate of

the Sponsor (including the Trust), and is indemnified by the Sponsor against any expenses it incurs relating to or arising out

of the formation, operation or termination of the Trust, or any action or inaction of the Trustee under the Trust Agreement, except

to the extent that such expenses result from the fraud, or the gross negligence or willful misconduct of the Trustee.

has the discretion to replace the Trustee.

is permitted to resign upon at least sixty (60) days’ notice to the Sponsor.

If no successor trustee has been appointed by the

Sponsor within such sixty-day period, the Trustee may, at the expense of the Trust, petition a court to appoint a successor.

Agreement provides that the Trustee is entitled to reasonable compensation for its services from the Sponsor or an affiliate of the Sponsor

(including the Trust), and is indemnified by the Sponsor against any expenses it incurs relating to or arising out of the formation,

operation or termination of the Trust, or any action or inaction of the Trustee under the Trust Agreement, except to the extent that

such expenses result from the fraud, or the gross negligence or willful misconduct of the Trustee.

The Sponsor has the discretion to

replace the Trustee.

Trustee has not signed this Annual Report and is not subject to issuer liability under the federal securities laws for the information

contained in this Annual Report and under federal securities laws with respect to the issuance and sale of the Shares.

laws, 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 or a director, officer or controlling person of the issuer of the

the Trust Agreement, the Trustee has delegated to the Sponsor the exclusive management and control of all aspects of the business

of the Trust and the Fund.

The Trustee has no duty or liability to supervise or monitor the performance of the Sponsor, nor does

the Trustee have any liability for the acts or omissions of the Sponsor.

the Trustee has delegated substantially all of its authority over the operation of the Trust to the Sponsor, the Trustee itself

is not registered in any capacity with the CFTC.

Clearing Brokers

StoneX Financial Inc.

(“StoneX”) and Phillip Capital Inc.

(“Phillip Capital”) serve as the Fund’s

clearing brokers to execute and clear futures contracts and provide other brokerage-related services.

StoneX and Phillip Capital

are each registered as a FCM with the CFTC and are members of the NFA.

The clearing brokers are registered as broker-dealers with

the SEC and are each a member of FINRA.

StoneX and Phillip Capital are each clearing members of ICE Futures U.S., Inc., Chicago

Board of Trade, Chicago Mercantile Exchange, New York Mercantile Exchange, and all other major United States commodity exchanges.

as indicated below, there have been no material civil, administrative, or criminal proceedings pending, on appeal, or concluded

against the Clearing Brokers or its principals in the past five (5) years.

disclosure for StoneX

below are material administrative, civil, enforcement, or criminal complaints or actions filed against StoneX Financial Inc.

FCM Division (f/k/a INTL FCStone Financial Inc.

- FCM Division) where such complaints or actions have not concluded and any material

enforcement actions or complaints filed against the StoneX Financial Inc.

- FCM Division in the past three years.

October 18, 2023, a subcommittee of the Exchange’s Business Conduct Committee (“BCC”)

determined that StoneX Financial Inc.

(“StoneX”) may have violated Exchange

Rules 4.15(a), 4.15(b), and 4.15(c) by failing to include a unique ID for Registered

Operators on certain orders and trades it transmitted to the Exchange.

For a period of

over four years, from February 2018 through the beginning of August 2022, StoneX, acting

as a Futures Commission Merchant, failed to assign, register, and populate unique IDs

(Tag 116) for an extensive number of orders placed and traded on the Exchange.

Specifically,

certain customers using a third-party front-end trading software were inappropriately

assigned the same generic ID for Tag 116 on orders and trades placed on the Exchange.

The BCC further determined that StoneX may have additionally violated Rule 4.01(a) by

failing to diligently supervise the accurate registration of unique IDs for customers;

and 4.01(b) by failing to establish, administer, and enforce supervisory systems, policies,

and procedures that are reasonably designed to achieve compliance with Exchange Rules.

StoneX was issued a fine of $300,000.

the delivery period for the September 2023 COMEX Aluminum (ALI) futures contract, StoneX

Financial, Inc.

failed to accurately report the delivery notices (DN) in its large trader

position files for the applicable trade dates in several instances in violation of Rule

On November 15, 2023, pursuant to Rule 512, a fine in the amount of $5,000 was assessed

again StoneX Financial Inc.

for its violations of Rule 561.

to an offer of settlement in which StoneX neither admitted nor denied the rule violations

or factual findings upon which the penalty is based, on November 15, 2023, a Panel of

the Chicago Mercantile Exchange (“CME”) Business Conduct Committee (“Panel”)

found that from September 6, 2022,through September 28, 2022, StoneX submitted block

trades to the Exchange with inaccurate execution times and failed to report block trades

to the Exchange within the required time period following execution in Three- Month SOFR

futures and Eurodollar options on futures markets.

Additionally, the Panel found that

StoneX failed to diligently supervise, monitor, and sufficiently train its employees

as to relevant Exchange rules and Market Regulation Advisory Notices in a manner sufficient

to ensure compliance with the same.

In accordance with the settlement offer, the Panel

ordered StoneX to pay a $70,000 fine.

March 16, 2023, the Clearing House Risk Committee at CME Group found that StoneX Financial,

violated Customer Gross Margining Technical Overview Requirements and CME Rule 980.G.

Pursuant to an

offer of settlement in which StoneX Financial, Inc.

neither admitted nor denied the rule violations upon which the penalty is

based, the Clearing House Risk Committee imposed a $100,000.00 fine which was effective on March 16, 2023.

January 20, 2023, the Clearing House Risk Committee at CME Group found that StoneX Financial

violated CME Rules 930.A and 930.F.

Pursuant to an offer of settlement in which

StoneX Financial, Inc.

neither admitted nor denied the rule violations upon which the

penalty is based, the Clearing House Risk Committee imposed a $50,000 fine which was

effective on January 20, 2023.

December 15, 2022, the Market Regulation Department of CME Group Inc.

notified StoneX Financial Inc.

(“SFI”) that it was conducting a formal investigation

into block trades placed in September 2022 that could potentially be in violation of

CME Rule 526 and Market Regulation Advisory Notice RA2004-5R.

On July 6, 2023, CME notified

SFI that it has referred the case to Market Regulation’s Enforcement Division.

Settlement negotiations are ongoing.

July 20, 2022, a subcommittee on the ICE Future US’s Business Conduct Committee

determined that in numerous instances between May 2020 and May 2021 StoneX Financial

and StoneX Markets LLC may have violated Exchange Rule 4.04 by engaging in improper

pre-hedging and adopting a risk policy that may have motivated employees to engage in

improper pre-hedging for certain contracts.

In addition, the Committee found that StoneX

Financial Inc.

and StoneX Markets LLC may have violated Exchange Rules 4.01(a), 4.07(c),

In accordance with the settlement offer, in which StoneX Financial Inc.

StoneX Markets LLC neither admitted nor denied the alleged rule violations, StoneX Financial

and StoneX Markets LLC agreed to pay a collective monetary penalty of $425,000 and

disgorge $225,606.80 in profits.

March 23, 2021, a subcommittee of the ICE Futures US’s Business Conduct Committee

determined that in numerous instances between February 2019 and May 2020, StoneX, formerly

INTL FCStone Financial Inc., may have violated Exchange Rule 6.15(a) by failing to submit

to the Exchange daily large trader reports on reportable customer positions and Exchange

Rule 4.01(a) by failing to have proper processes for reporting large trader positions.

The ICE Futures US Business Conduct Committee imposed a $75,000 fine on StoneX Financial

which was effective on March 23, 2021.

a historic move in the natural gas market in November of 2018, INTL FCStone Financial

- FCM Division (“IFF”) experienced a number of customer deficits.

soon thereafter initiated NFA arbitrations, seeking to collect these debits, and has

also been countersued and sued in a number of these arbitrations.

These accounts were

managed by Optionsellers.com, (“Optionsellers”) who is a Commodity Trading

Advisor (“CTA”) authorized by investors to act as attorney-in-fact with exclusive

trading authority over these investors’ trading accounts.

These accounts cleared

After this significant and historic natural gas market movement, the accounts

declined below required maintenance margin levels.

IFF’s role in managing the accounts

As a clearing firm, IFF did not provide any investment advice, trading advice,

or recommendations to customers of Optionsellers who chose to clear with IFF.

it simply executed and cleared trades placed by Optionsellers on behalf of Optionsellers’

Optionsellers is a CFTC registered CTA operating under a CFTC Rule 4.7 exemption

from registration.

Optionsellers engaged in a strategy that primarily involved selling

options on futures products.

The arbitrations between IFF, Optionsellers, and the Optionsellers

customers are currently ongoing.

StoneX Financial Inc.

is subject to litigation and regulatory enforcement in the normal course of business.

Except as discussed

above, the current or pending civil litigation or administrative proceedings in which StoneX Financial Inc.

is involved are not

expected to have a material effect upon its condition, financial or otherwise.

StoneX Financial Inc.

vigorously defends, as a

matter of policy, civil litigation, reparation, arbitration proceedings, and enforcement actions brought against it.

disclosure for Phillip Capital

Capital is a registered futures commission merchant and is a member of the NFA.

Its main office is located at 141 West Jackson

Blvd., Suite 1531A, Chicago, Illinois 60604.

In the normal course of its business, Phillip Capital is involved in various legal

actions incidental to its commodities business.

None of these actions are expected either individually or in aggregate to have

a material adverse impact on Phillip Capital.

Except for the below, neither Phillip Capital nor any of its principals have been

the subject of any material administrative, civil or criminal actions within the past five years.

September 12, 2019, the U.S.

Commodity Futures Trading Commission issued an order settling charges against Phillip Capital for

allowing cyber criminals to breach Phillip Capital email systems, access customer information, and successfully withdrawing $1

million in Phillip Capital customer funds.

The order found that Phillip Capital failed to disclose the cyber breach to its customers

in a timely manner and that Phillip Capital failed to supervise its employees with respect to cybersecurity policy and procedures,

a written information systems security program, and customer disbursements.

The order imposed monetary sanctions totaling $1.5

million, which includes a civil monetary penalty of $500,000, and $1 million in restitution.

Phillip Capital was credited the

$1 million restitution based on its prompt reimbursement of the customer funds when the fraud was discovered.

The order also required

Phillip Capital to, among other things, provide reports to the Commission on its remediation efforts.

June 11, 2021, pursuant to an offer of settlement in which Phillip Capital Inc.

neither admitted nor denied the rule

violation upon which the penalty is based, the Clearing House Risk Committee found that Phillip Capital Inc.

Rule 980.A - Required Records and Reports.

In accordance with the settlement offer, the Committee imposed a $50,000 fine for

non-current books and records due to an issue with the firm’s middleware provider.

In a related matter, the CME Group

had previously fined Phillip Capital Inc.

on March 19, 2021, for its violation of Rule 811 and 561.

During the month of

February 2021, Phillip Capital Inc.

inaccurately reported its open interest and large trader positions in several instances

of CME, CBT, NYMEX, and COMEX contracts due to the aforementioned middleware issue.

A fine in the amount of $5,000 was

assessed against Phillip Capital Inc.

Trading Advisor

the Sponsor does not employ commodity trading advisors with respect to the Fund.

If, in the future, the Sponsor does employ commodity

trading advisors for the Fund, it will choose each advisor based on arm’s length negotiations and will consider the advisor’s

experience, fees, and reputation.

Under such laws,

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 or a director, officer or controlling person of the issuer of the Shares.

the Trust Agreement, the Trustee has delegated to the Sponsor the exclusive management and control of all aspects of the business of

the Trust and the Fund.

The Trustee has no duty or liability to supervise or monitor the performance of the Sponsor, nor does the Trustee

have any liability for the acts or omissions of the Sponsor.

Fees and Compensation Arrangements with the Sponsor and Third-Party Service Providers

Paid by the Fund

Tidal Investments

Asset Management Ltd., Sponsor

of average net assets annually

Capital Inc., Futures Commission Merchant and Clearing Broker

Fund pays $5.00-$10.00 per Futures Contract half-turn exclusive of pass through fees

for the exchange, NFA, execution fees, and platform and exchange data fees.

StoneX Financial

Inc., Futures Commission Merchant and Clearing Broker

Fund pays $10.00-$25.00 per Futures Contract half-turn exclusive of pass through fees for the exchange and NFA.

Additionally,

if the monthly commissions paid do not equal or exceed 20% return on the Maintenance Margin Requirement at 9.6% of Exchange

Maintenance Margin, the Fund will pay a true up to meet that return at the end of each month.

Wilmington Trust,

Trust, Trustee

annually for the Trust

fees are calculated on a daily basis (accrued at 1/365 of the applicable percentage of NAV on that day) and paid on a monthly

NAV is calculated by taking the current market value of the Fund’s total assets and subtracting any liabilities.

above table does not include compensation arrangements between the Sponsor and third-party service providers including the Administrator,

Custodians, Marketing Agent, Transfer Agent, or auditors.

Non-Contractual Payments by the Fund

Fund pays the Sponsor a Management Fee, monthly in arrears, in an amount equal to 0.25% per annum of the daily NAV of the Fund.

The Management Fee is paid in consideration of the Sponsor’s services related to the management of the Fund’s business

and affairs, including the provision of commodity futures trading advisory services.

Purchases of creation units with cash may

cause the Fund to incur certain costs including brokerage commissions and redemptions of creation units with cash may result in

the recognition of gains or losses that the Fund might not have incurred if it had made redemptions in-kind.

The Fund pays all

of its respective brokerage commissions, including applicable exchange fees, NFA fees and give-up fees, and other transaction

related fees and expenses charged in connection with trading activities for the Fund’s investments in CFTC regulated investments.

The Fund bears other transaction costs related to the FCM capital requirements on a monthly basis.

The Sponsor pays all of the

routine operational, administrative and other ordinary expenses of the Fund, generally as determined by the Sponsor, including

but not limited to, fees and expenses of the Administrator, Sub-Administrator, Custodians, Marketing Agent, Transfer Agent, licensors,

accounting and audit fees and expenses, tax preparation expenses, legal fees, ongoing SEC registration fees, individual Schedule

K-1 preparation and mailing fees, and report preparation and mailing expenses.

The Fund pays all of its non-recurring and unusual

fees and expenses, if any, as determined by the Sponsor.

Non-recurring and unusual fees and expenses are unexpected or unusual

in nature, such as legal claims and liabilities and litigation costs or indemnification or other unanticipated expenses.

Extraordinary

fees and expenses also include material expenses which are not currently anticipated obligations of the Fund.

Routine operational,

administrative and other ordinary expenses are not deemed extraordinary expenses.

The Management

Fee is paid in consideration of the Sponsor’s services related to the management of the Fund’s business and affairs.

to the Management Fee, the Fund pays all of its respective brokerage commissions, including financing fees, Bitcoin Network fees and

similar transaction fees and expenses charged in connection with trading activities.

The Trust also pays all fees and commissions related

to the sale and purchase of spot bitcoin, including any bitcoin transaction fees for on-chain transfers of bitcoin.

The Sponsor pays

all other routine operational, administrative and other ordinary expenses of the Fund, generally as determined by the Sponsor, including

but not limited to, fees and expenses of the Administrator, Custodians, Marketing Agent, Transfer Agent, licensors, accounting and audit

fees and expenses, tax preparation expenses, legal fees, ongoing SEC registration fees, individual Schedule K-1 preparation and mailing

fees, and report preparation and mailing expenses.

The Fund pays all of its non-recurring and unusual fees and expenses, if any, as determined

by the Sponsor.

Non-recurring and unusual fees and expenses are unexpected or unusual in nature, such as legal claims and liabilities

and litigation costs or indemnification or other unanticipated expenses.

Extraordinary fees and expenses also include material expenses

which are not currently anticipated obligations of the Fund.

Routine operational, administrative and other ordinary expenses are not

deemed extraordinary expenses.

In the event the Trust’s cash balance is insufficient to pay all fees and expenses, including the

Management Fee, the Trust may need to sell crypto assets from time to time to pay for its fees and expenses, and up to $250,000 per annum

in ordinary legal fees and expenses.

The Sponsor may determine in its sole discretion to assume legal fees and expenses of the Trust

in excess of $250,000 per annum.

The Sponsor may determine in its sole discretion to assume any non-recurring and unusual fees and expenses

of the Trust, if applicable.

To the extent that the Sponsor does not voluntarily assume such fees and expenses, they will be the responsibility

of the Trust.

Authorized Purchasers pay a $300 fee per order to create and redeem Baskets, which is paid to the Cash Custodian.

$300 fee may not be used by the Fund to cover expenses related to creations and redemptions.

Expenses paid by Sponsor are not subject

to any caps or limits.

are issued in registered form in accordance with the Trust Agreement.

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Agent for the purpose of transferring Shares in certificated form.

Global Fund Services keeps a record of all Shareholders and

holders of the Shares in certificated form in the registry (“Register”).

The Sponsor recognizes transfers of Shares

in certificated form only if done in accordance with the Trust Agreement.

The beneficial interests in such Shares are held in

book-entry form through purchasers and/or accountholders in DTC.

Global Fund Services keeps a record of all shareholders and holders

of the Shares in certificated form in the registry (the “Register”).

The Sponsor recognizes transfers of Shares in certificated

form only if done in accordance with the Trust Agreement.

The beneficial interests in such Shares are held in book-entry form through

purchasers and/or accountholders in the Depository Trust Company (“DTC”).

certificates are not issued for the Shares.

Instead, Shares are represented by one or more global certificates, which are deposited

by the Sub-Administrator with DTC and registered in the name of Cede & Co., as nominee for DTC.

The global certificates evidence

all of the Shares outstanding at any time.

Shareholders are limited to (1) purchasers in DTC such as banks, brokers, dealers and

trust companies, (2) those who maintain, either directly or indirectly, a custodial relationship with a DTC purchaser, and (3)

those who hold interests in the Shares through DTC purchasers or Indirect purchasers, in each case who satisfy the requirements

Instead, Shares are represented by one or more global certificates, which are deposited by

the Administrator with DTC and registered in the name of Cede & Co., as nominee for DTC.

The global certificates evidence all of

the Shares outstanding at any time.

Shareholders are limited to (1) purchasers in DTC such as banks, brokers, dealers and trust companies,

(2) those who maintain, either directly or indirectly, a custodial relationship with a DTC purchaser (“Indirect Purchasers”),

and (3) those who hold interests in the Shares through DTC purchasers or Indirect Purchasers, in each case who satisfy the requirements

for transfers of Shares.

DTC purchasers acting on behalf of investors holding Shares through such purchasers’ accounts in

DTC will follow the delivery practice applicable to securities eligible for DTC’s Same Day Funds Settlement System.

are credited to DTC purchasers’ securities accounts following confirmation of receipt of payment.

is a limited purpose trust company organized under the laws of the State of New York and is a member of the Federal Reserve System,

a “clearing corporation” within the meaning of the New York Uniform Commercial Code and a “clearing agency”

registered pursuant to the provisions of Section 17A of the Exchange Act.

DTC holds securities for DTC purchasers and facilitates

the clearance and settlement of transactions between DTC purchasers through electronic book-entry changes in accounts of DTC purchasers.

DTC purchasers acting on behalf of investors holding Shares through such purchasers’ accounts in DTC will

follow the delivery practice applicable to securities eligible for DTC’s Same Day Funds Settlement System.

Shares are credited

to DTC purchasers’ securities accounts following confirmation of receipt of payment.

is a limited purpose trust company organized under the laws of the State of New York and is a member of the Federal Reserve System, a

“clearing corporation” within the meaning of the New York Uniform Commercial Code and a “clearing agency” registered

pursuant to the provisions of Section 17A of the Securities Exchange Act of 1934 (the “Exchange Act”).

DTC holds securities

for DTC purchasers and facilitates the clearance and settlement of transactions between DTC purchasers through electronic book-entry

changes in accounts of DTC purchasers.

Shares are only transferable through the book-entry system of DTC.

Shareholders who are not DTC purchasers may transfer their

Shares through DTC by instructing the DTC purchaser holding their Shares (or by instructing the Indirect purchaser or other entity

through which their Shares are held) to transfer the Shares.

Transfers are made in accordance with standard securities industry

of interests in Shares with DTC are made in accordance with the usual rules and operating procedures of DTC and the nature of

the transfer.

Shareholders who are not DTC purchasers may transfer their Shares

through DTC by instructing the DTC purchaser holding their Shares (or by instructing the Indirect Purchaser or other entity through which

their Shares are held) to transfer the Shares.

Transfers are made in accordance with standard securities industry practice.

of interests in Shares with DTC are made in accordance with the usual rules and operating procedures of DTC and the nature of the transfer.

DTC has established procedures to facilitate transfers among the purchasers and/or accountholders of DTC.

DTC can only act on behalf of DTC Purchasers, who in turn act on behalf of Indirect Purchasers, the ability of a person or entity

having an interest in a global certificate to pledge such interest to persons or entities that do not participate in DTC, or otherwise

take actions in respect of such interest, may be affected by the lack of a certificate or other definitive document representing

such interest.

has advised us that it will take any action permitted to be taken by a Shareholder (including, without limitation, the presentation

of a global certificate for exchange) only at the direction of one or more DTC purchasers in whose account with DTC interests

in global certificates are credited and only in respect of such portion of the aggregate principal amount of the global certificate

as to which such DTC purchaser or purchasers has or have given such direction.

Limitation on Liability

the Trust was established as a Delaware statutory trust, the Fund and each other series that may be established under the Trust

in the future will be operated so that it will be liable only for obligations attributable to such series and will not be liable

for obligations of any other series or affected by losses of any other series.

If any creditor or Shareholder of any particular

series (such as the Fund) asserts against the series a valid claim with respect to its indebtedness or Shares, the creditor or

Shareholder will only be able to obtain recovery from the assets of that series and not from the assets of any other series or

the Trust generally.

The assets of the Fund and any other series will include only those funds and other assets that are paid

to, held by or distributed to the series on account of and for the benefit of that series, including, without limitation, amounts

delivered to the Trust for the purchase of Shares in a series.

This limitation on liability is referred to as the Inter-Series

Because DTC can only act on

behalf of DTC purchasers, who in turn act on behalf of Indirect Purchasers, the ability of a person or entity having an interest in a

global certificate to pledge such interest to persons or entities that do not participate in DTC, or otherwise take actions in respect

of such interest, may be affected by the lack of a certificate or other definitive document representing such interest.

has advised us that it will take any action permitted to be taken by a shareholder (including, without limitation, the presentation of

a global certificate for exchange) only at the direction of one or more DTC purchasers in whose account with DTC interests in global

certificates are credited and only in respect of such portion of the aggregate principal amount of the global certificate as to which

such DTC purchaser or purchasers has or have given such direction.

Limitation on Liability

The Inter-Series Limitation on Liability is expressly provided for under the Delaware Statutory Trust

Act, which provides that if certain conditions (as set forth in Section 3804(a)) are met, then the debts of any particular series

will be enforceable only against the assets of such series and not against the assets of any other series or the Trust generally.

In furtherance of the Inter- Series Limitation on Liability, every party providing services to the Trust, the Fund or the Sponsor

on behalf of the Trust or the Fund, will acknowledge and consent in writing to the Inter-Series Limitation on Liability with respect

to such party’s claims.

the Trust was established as a Delaware statutory trust, the Fund and each other series that may be established under the Trust in the

future will be operated so that it will be liable only for obligations attributable to such series and will not be liable for obligations

of any other series or affected by losses of any other series.

If any creditor or shareholder of any particular series (such as the Fund)

asserts against the series a valid claim with respect to its indebtedness or shares, the creditor or shareholder will only be able to

obtain recovery from the assets of that series and not from the assets of any other series or the Trust generally.

The assets of the

Fund and any other series will include only those funds and other assets that are paid to, held by or distributed to the series on account

of and for the benefit of that series, including, without limitation, amounts delivered to the Trust for the purchase of shares in a

This limitation on liability is referred to as the “Inter-Series Limitation on Liability”.

The Inter-Series Limitation

on Liability is expressly provided for under the DSTA, which provides that if certain conditions (as set forth in Section 3804(a) of

the DSTA) are met, then the debts of any particular series will be enforceable only against the assets of such series and not against

the assets of any other series or the Trust generally.

In furtherance of the Inter-Series Limitation on Liability, every party providing

services to the Trust, the Fund or the Sponsor on behalf of the Trust or the Fund, will acknowledge and consent in writing to the Inter-Series

Limitation on Liability with respect to such party’s claims.

existence of a Trustee should not be taken as an indication of any additional level of management or supervision over the Fund.

Consistent with Delaware law, the Trustee acts in an entirely passive role, delegating all authority for the management and operation

of the Fund and the Trust to the Sponsor.

with Delaware law, the Trustee acts in an entirely passive role, delegating all authority for the management and operation of the Fund

and the Trust to the Sponsor.

The Trustee does not provide custodial services with respect to the assets of the Fund.

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investors buy and sell Shares of the Fund in secondary market transactions through brokers.

Shares trade on NYSE Arca under the

ticker symbol “DEFI.” Shares are bought and sold throughout the trading day like other publicly traded securities.

When buying or selling Shares through a broker, most investors incur customary brokerage commissions and charges.

Investors are

encouraged to review the terms of their brokerage account for details on applicable charges and, as discussed below under “U.S.

Federal Income Tax Considerations,” any provisions authorizing the broker to borrow Shares held on your behalf.

Shares trade on NYSE Arca under the ticker

symbol “DEFI.” Shares are bought and sold throughout the trading day like other publicly traded securities.

When buying or

selling Shares through a broker, most investors incur customary brokerage commissions and charges.

Investors are encouraged to review

the terms of their brokerage account for details on applicable charges and any provisions authorizing the broker to borrow Shares held

on your behalf.

Agent and Authorized Purchasers

offering of the Fund’s Shares is a best efforts offering.

The Fund continuously offers Creation Baskets consisting of 10,000

Shares at their NAV through the Marketing Agent to Authorized Purchasers.

The Fund continuously offers Baskets consisting of 10,000 Shares at their

NAV through the Marketing Agent to Authorized Purchasers.

Shares will be sold at the next determined NAV per Share.

All Authorized Purchasers pay a $300 fee for each Creation Basket order.

All Authorized Purchasers

pay a $300 fee for each Basket order.

following entities have entered into Authorized Purchaser Agreements with respect to the Fund:

Jane Street Capital, LLC, Mirae

Asset Financial Group and Virtu Americas LLC.

new Shares can be created and issued on an ongoing basis, at any point during the life of the Fund, a “distribution,”

as such term is used in the 1933 Act, will be occurring.

Authorized Purchasers, other broker-dealers and other persons are cautioned

that some of their activities may result in their being deemed purchasers in a distribution in a manner that would render them

statutory underwriters and subject them to the prospectus delivery and liability provisions of the 1933 Act.

For example, an Authorized

Purchaser, other broker-dealer firm or its client will be deemed a statutory underwriter if it purchases a basket from the Fund,

breaks the basket down into the constituent Shares and sells the Shares to its customers;

or if it chooses to couple the creation

of a supply of new Shares with an active selling effort involving solicitation of secondary market demand for the Shares.

Authorized Purchasers may engage in secondary market or other transactions in Shares that would not be deemed “underwriting.”

For example, an Authorized Purchaser may act in the capacity of a broker or dealer with respect to Shares that were previously

distributed by other Authorized Purchasers.

A determination of whether a particular market purchaser is an underwriter must take

into account all the facts and circumstances pertaining to the activities of the broker-dealer or its client in the particular

case, and the examples mentioned above should not be considered a complete description of all the activities that would lead to

designation as an underwriter and subject them to the prospectus delivery and liability provisions of the 1933 Act.

Jane Street Capital, LLC, Mirae Asset

Securities (USA) Inc., Virtu Americas LLC, Macquarie Capital (USA) Inc, Goldman Sachs & Co.

LLC and Citadel Securities LLC.

new Shares can be created and issued on an ongoing basis, at any point during the life of the Fund, a “distribution,” as

such term is used in the Securities Act of 1933 (the “1933 Act”), will be occurring.

Authorized Purchasers, other broker-dealers

and other persons are cautioned that some of their activities may result in their being deemed purchasers in a distribution in a manner

that would render them statutory underwriters and subject them to the prospectus delivery and liability provisions of the 1933 Act.

example, an Authorized Purchaser, other broker-dealer firm or its client will be deemed a statutory underwriter if it purchases a Basket

from the Fund, breaks the Basket down into the constituent Shares and sells the Shares to its customers;

or if it chooses to couple the

creation of a supply of new Shares with an active selling effort involving solicitation of secondary market demand for the Shares.

contrast, Authorized Purchasers may engage in secondary market or other transactions in Shares that would not be deemed “underwriting.”

For example, an Authorized Purchaser may act in the capacity of a broker or dealer with respect to Shares that were previously distributed

by other Authorized Purchasers.

A determination of whether a particular market purchaser is an underwriter must take into account all

the facts and circumstances pertaining to the activities of the broker-dealer or its client in the particular case, and the examples

mentioned above should not be considered a complete description of all the activities that would lead to designation as an underwriter

and subject them to the prospectus delivery and liability provisions of the 1933 Act.

who are neither Authorized Purchasers nor “underwriters” but are nonetheless participating in a distribution (as contrasted

to ordinary secondary trading transactions), and thus dealing with Shares that are part of an “unsold allotment” within

the meaning of Section 4(a)(3)(C) of the 1933 Act, would be unable to take advantage of the prospectus delivery exemption provided

by Section 4(a)(3) of the 1933 Act.

to ordinary secondary trading transactions), and thus dealing with Shares that are part of an “unsold allotment” within the

meaning of Section 4(a)(3)(C) of the 1933 Act, would be unable to take advantage of the prospectus delivery exemption provided by Section

4(a)(3) of the 1933 Act.

are cautioned that they might not be able to buy or sell Shares of the Fund through their current brokerages.

Moreover, even if

an investor were able to purchase Shares through their current brokerage, that brokerage might decide to stop trading in bitcoin-linked

securities and the investor would potentially face restrictions on when and or how they could trade their existing bitcoin position.

Moreover, even if an investor

were able to purchase Shares through their current brokerage, that brokerage might decide to stop trading in bitcoin-linked securities

and the investor would potentially face restrictions on when and or how they could trade their existing bitcoin position.

Sponsor expects that any broker-dealers selling Shares will be members of FINRA.

Investors intending to create or redeem baskets

through Authorized Purchasers in transactions not involving a broker-dealer registered in such investor’s state of domicile

or residence should consult their legal advisor regarding applicable broker-dealer regulatory requirements under the state securities

laws prior to such creation or redemption.

the Authorized Purchasers may be indemnified by the Sponsor, they will not be entitled to receive a discount or commission from

the Trust or the Sponsor for their purchases of Creation Baskets.

Investors intending to create or redeem Baskets through

Authorized Purchasers in transactions not involving a broker-dealer registered in such investor’s state of domicile or residence

should consult their legal advisor regarding applicable broker-dealer regulatory requirements under the state securities laws prior to

such creation or redemption.

the Authorized Purchasers may be indemnified by the Sponsor, they will not be entitled to receive a discount or commission from the Trust

or the Sponsor for their purchases of Baskets.

Fund’s NAV per Share is calculated by:

the current market value of its total assets, including but not limited to spot bitcoin,

Bitcoin Futures Contracts and cash, pursuant to policies established from time to time

by the Sponsor or otherwise described herein,

the current market value of its total assets, including spot bitcoin and cash, pursuant to

policies established from time to time by the Sponsor or otherwise described herein,

● subtracting

any liabilities and dividing the balance by the number of Share, and.

any liabilities, and.

the above total by the number of Shares outstanding.

Fund Services, in its capacity as the Sub-Administrator, calculates the NAV of the Fund once each trading day.

It calculates the

NAV as of the earlier of the close of regular trading on NYSE Arca or 4:00 p.m.

The NAV for a particular trading day is

released after 4:15 p.m.

of Bitcoin Futures Contracts

determining the value of Bitcoin Futures Contracts, the Sub-Administrator uses primarily the settlement price for the Bitcoin

Futures Contracts, as reported on the CME.

CME Group staff determines the daily settlements for the Bitcoin Futures Contracts

based on trading activity on CME Globex exchange between 14:59:00 and 15:00:00 Central Time (CT), the settlement period.

In situations

where a two-sided market is not available during the closing period, the CME will derive a settlement price using the carry calculation

method based on the CME CF Bitcoin Reference Rate (BRR).

This method calculates the settlement price as the reference rate plus

an adjustment factoring in the days to expiration and the interest rate.

Specifically, the settlement price is determined by the

BRR + [(Days to Expiration / 365) × Interest Rate × BRR].

The interest rate used will be the rate on the

Overnight Index Swap (OIS) curve corresponding with the expiration date of the futures contract used in the calculation.

a Bitcoin Futures Contracts has closed at its daily price fluctuation limit, that limit price will be the daily settlement price

that the CME publishes.

exceptional circumstances when:

(i) Bitcoin Futures Contracts settlement prices are not readily available;

or (ii) when a trading

halt closes CME or the Bitcoin Futures Market early, including if trading were halted for an entire trading day or several trading

or (iii) when a Bitcoin Futures Contracts close at its price fluctuation limit for the day, the fair value of such contracts

are determined by the Sponsor in good faith and in a manner that assesses the Bitcoin Futures Contracts’ value based on

a consideration of all available facts and all available information on the valuation date.

The fair value of Bitcoin Futures

Contracts is determined by attempting to estimate the price at which such Bitcoin Futures Contract would be trading in the absence

of the price fluctuation limit (either above such limit when an upward limit has been reached or below such limit when a downward

limit has been reached).

Typically, this estimate will be made primarily using a carry calculation described above that uses the

BRR at 4:00 p.m.

on settlement day as a reference price.

The fair value of BTC Contracts and MBT Contracts may not reflect

such security’s market value or the amount that the Fund might reasonably expect to receive for the BTC Contracts and MBT

Contracts upon its current sale.

Futures-Based Spot Price for bitcoin

otherwise determined by the Sponsor in its sole discretion, the value of spot bitcoin held by the Fund is determined by the Administrator

in good faith based on a methodology that is entirely derived from the settlement prices of Bitcoin Futures Contracts on the CME.

An example of how the value of spot bitcoin held by the Fund is calculated is included further below.

the calculation of the Fund’s NAV, the value of the bitcoin held by the Fund will be determined using a “Futures-Based Spot Price” (or “FBSP”) methodology.

This methodology has been chosen by the Sponsor specifically to calculate

the Fund’s NAV, isolating it from data from unregulated bitcoin exchanges.

The FBSP will be utilized not only for valuing

the Fund’s bitcoin for NAV calculation but also for determining the amounts required for the Creation Basket Deposit and

for the redemption distribution amounts.

It is important to distinguish this methodology from that of the Fund’s performance

benchmark, the NQBTCS (the Benchmark).

The Benchmark, as selected by the Sponsor, is used exclusively for performance benchmarking

purposes in relation to the Fund’s investment objective, and, unless otherwise determined by the Sponsor, does not influence

the NAV calculation or the determination of the Creation Basket Deposit and redemption distributions.

methodology to derive the settlement prices of Bitcoin Futures Contracts on the CME involves a calculation that is a function

of both the length of time (the tenor) until each Bitcoin Futures Contract is due for settlement, and the final settlement price

for each contract on that day.

The calculation is based on estimating a simple quadratic function to fit the prices across the

different tenors and extrapolate this curve to zero days tenor.

This approach is designed to give more importance to contracts

that are due for settlement in the near term, considering that the prices of these near-term contracts are more reliable indicators

of the current spot price of Bitcoin and are also more heavily traded.

A formal mathematical description of the calculation is

the following:

fj,t , as the closing price of the Bitcoin Future Contract with tenor period j (measured in calendar days) at date t.

J t a column vector of all the tenors traded at date t (except those on their last trading day), so F = { fj,t }j∈/t

column a vector of all the settlement prices of Bitcoin Futures traded at date t (except those on their Past last trading day).

Also defining X = [1, Jt , J 2 ] a regressors matrix containing ones in its first column, tenor in the second and

squared tenors in the third, and W = diag( J - 2 ) as a square weighting matrix with inverse squared tenors on

its diagonal.

The estimated parameters are given by

L = ( X t • W • X ) -1 • X t • W

estimated value for the spot price is the first element of β , associated with the first column (intercept).

the value of the fitted curve when the tenor is zero.

calculation produces a set of weighting factors, with each factor indicating the contribution of the corresponding Bitcoin Futures

Contract to the estimated current spot price of Bitcoin.

These weighting factors are given by the first line of matrix L and

they sum up to one (100%).

These weights are calculated daily and are dependent solely on the number of calendar days until maturity

of each active BTC Contract.

The spot price for bitcoin derived from FBSP is, in turn, calculated by multiplying each price by

its applicable weight and then summing all terms:

W i is the weight and SP i is the settlement price of each BTC Contract.

Fund does not use data from bitcoin exchanges or from spot bitcoin trading activity.

way of example, the table below shows how the weights of each hypothetical Bitcoin Futures Contract change over time as the first

contract gets closer to maturity.

chart below visually illustrates the CME Bitcoin Futures Market’s forward curve and how the FBSP is determined for a specific

date (October 9, 2023).

Each black dot represents the settlement price of a specific CME Bitcoin Futures Contract.

The blue line

represents the calculated (fitted) forward curve.

The black dots align closely with the fitted curve in blue, meaning that the

curve accurately tracks the settlement prices of the BTC Contracts.

The black square is a point on the curve corresponding to

a zero-day maturity, representing the spot price for bitcoin for that date.

table below exemplifies how the value of spot bitcoin held by the Fund is calculated using the weights and factors explained above

for the same date:

FBSP on 10/09/2023

Settlement Price (SP)

Tenor (calendar days)

Futures Weights (W)

Weighted Price (W x SP)

Divergence (%)

valuation policies of the Fund address potential for a blockchain for a crypto asset to diverge into different paths and airdrops.

In the event of a fork in the Bitcoin Network, for example, the Fund will adhere to the decision made by the CME regarding which

of the resulting networks will be considered as bitcoin.

In other words, the network considered as bitcoin by the Fund will align

with the one recognized in the context of CME Bitcoin Futures.

In the occurrence of a fork, airdrop or similar event, the Sponsor

will cause the Fund to irrevocably abandon the Incidental Rights and any IR Virtual Currency associated with such event and the

only crypto asset to be held by the Fund will be bitcoin.

Sponsor may determine that the FBSP calculation should not be used to value the Fund in exceptional circumstances when:

Futures Contracts settlement prices are not readily available;

or (2) when a settlement price is not available for the first and

second-to-expire Bitcoin Futures Contracts for the day;

or (3) settlement price data is not published for at least three Bitcoin

Future Contracts expirations.

Sponsor does not anticipate that the need to rely on an alternative pricing source for bitcoin to be a common occurrence.

for whatever unexpected reasons, this price could not be calculated by the current methodology, the Fund’s bitcoin holdings

will be priced using the NQBTCS.

In the event both the FBSP and the NQBTCS are unavailable, the Sponsor will fair value the Fund’s

bitcoin based on the most recent data available for Bitcoin Futures Contracts on the CME, by calculating the present value of

the most traded Bitcoin Futures Contract for the day based on its settlement price or last traded price in case the first is not

available, using the formula:

Contract Price / (1 + Days to Expiration/365 x Interest Rate).

If there is no Bitcoin Futures Contracts

activity for the day, the fair value will be the last available FBSP price.

This fair value of bitcoin may not reflect its market

value or the amount that the Fund might reasonably expect to receive for the bitcoin upon its current sale.

addition, in order to provide updated information relating to the Fund for use by investors and market professionals, ICE Data

Indices, LLC calculates and disseminates throughout the trading day an updated “indicative fund value.” The indicative

fund value is calculated by using the prior day’s closing NAV per Share of the Fund as a base and updating that value throughout

the trading day to reflect changes in the value of the Fund’s bitcoin interests during the trading day.

Changes in the value

of cash equivalents are not included in the calculation of indicative value.

For this and other reasons, the indicative fund value

disseminated during NYSE Arca trading hours should not be viewed as an actual real time update of the NAV.

NAV is calculated only

once at the end of each trading day.

indicative fund value is disseminated on a per Share basis every 15 seconds during regular NYSE Arca trading hours of 9:30 a.m.

(ET) to 4:00 p.m.

The trading hours for the CME are from 6:00 p.m.

(ET) on Sunday to 5:00 p.m.

(ET) on Friday, with one

hour maintenance breaks Monday through Thursday between 5:00 p.m.

Fund Services, in its capacity as the Administrator, calculates the NAV of the Fund once each trading day.

It calculates the NAV as of

the earlier of the close of regular trading on NYSE Arca or 4:00 p.m.

The NAV for a particular trading day is released after 4:15

determining the value of Fund’s holdings, the Administrator will value the bitcoin held by the Fund based on the closing level

of the Benchmark, the NQBTCS, unless the prices are not available or the Administrator, in its sole discretion, determines that the NQBTCS

is unreliable (the “Fair Value Event”).

the instance of a Fair Value Event, the Fund’s holdings may be fair valued on a temporary basis in accordance with the fair value

policies approved by the Administrator.

In the instance of a Fair Value Event and pursuant to the Administrator’s fair valuation

policies and procedures, volume-weighted average prices or volume weighted median prices from another index administrator (the “Secondary

Index”) will be utilized.

a Secondary Index is also not available or the Administrator in its sole discretion determines the Secondary Index is unreliable, the

price set by the Fund’s principal market as of 4:00 p.m.

E.T., on the valuation date will be utilized.

In the event the principal

market price is not available or the Administrator in its sole discretion determines the principal market valuation is unreliable, the

Administrator will use its best judgment to determine a good faith estimate of fair value.

The Administrator identifies and determines

the Fund’s principal market (or in the absence of a principal market, the most advantageous market) for crypto assets consistent

with the application of fair value measurement framework in the Financial Accounting Standards Board (“FASB”) Accounting

Standards Codification 820-10.

The principal market is the market where the reporting entity would normally enter into a transaction

to sell the asset or transfer the liability.

The principal market must be available to and be accessible by the reporting entity.

reporting entity is the Trust.

If NQBTCS is not used to determine the Fund’s bitcoin holdings, shareholders will be notified through

a prospectus supplement, a current report on Form 8-K, the Fund’s periodic Exchange Act reports and/or on the Fund’s website.

Fair Value Event value determination will be based upon all available factors that the Sponsor or the Administrator deems relevant at

the time of the determination and may be based on analytical values determined by the Sponsor or Administrator using third party valuation

Fair value policies approved by the Administrator will seek to determine the fair value price that the Fund might reasonably

expect to receive from the current sale of that asset or liability in an arm’s-length transaction on the date on which the asset

or liability is being valued consistent with “Relevant Transactions”.

A “Relevant Transaction” is any crypto

asset versus USD spot trade that occurs during the observation window between 3:00 p.m.

and 4:00 p.m.

on a Core Exchange in the

BTC/USD pair that is reported and disseminated by a Core Exchange through its publicly available application programming interface and

observed by the IMC.

addition, in order to provide updated information relating to the Fund for use by investors and market professionals, ICE Data Indices,

LLC calculates and disseminates throughout the trading day an updated “indicative fund value.” The indicative fund value

is calculated by using the prior day’s closing NAV per Share of the Fund as a base and updating that value throughout the trading

day to reflect changes in the value of the Fund’s bitcoin interests during the trading day.

Changes in the value of cash equivalents

are not included in the calculation of indicative value.

For this and other reasons, the indicative fund value disseminated during NYSE

Arca trading hours should not be viewed as an actual real time update of the NAV.

NAV is calculated only once at the end of each trading

indicative fund value is disseminated on a per Share basis every 15 seconds during regular NYSE Arca trading hours of 9:30 a.m.

Data Indices, LLC disseminates the indicative fund value through the facilities of CTA/CQ High Speed Lines.

4 unchanged sentences

and market professionals in connection with the trading of Fund Shares on NYSE Arca.

Investors and market professionals are able

throughout the trading day to compare the market price of the Fund and the indicative fund value.

If the market price of Fund

Shares diverges significantly from the indicative fund value, market professionals may have an incentive to execute arbitrage

For example, if the Fund appears to be trading at a discount compared to the indicative fund value, a market professional

could buy Fund Shares on NYSE Arca, aggregate them into Redemption Baskets, and receive the NAV of such Shares by redeeming them

to the Trust provided that there is not a minimum number of Shares outstanding for the Fund.

Such arbitrage trades can tighten

the tracking between the market price of the Fund and the indicative fund value.

Investors and market professionals are able throughout

the trading day to compare the market price of the Fund and the indicative fund value.

If the market price of Fund Shares diverges significantly

from the indicative fund value, market professionals may have an incentive to execute arbitrage trades.

For example, if the Fund appears

to be trading at a discount compared to the indicative fund value, a market professional could buy Fund Shares on NYSE Arca, aggregate

them into Baskets, and receive the NAV of such Shares by redeeming them to the Trust provided that there is not a minimum number of Shares

outstanding for the Fund.

Such arbitrage trades can tighten the tracking between the market price of the Fund and the indicative fund

and Redemption of Shares

Fund creates and redeems Shares from time to time, but only in one or more Creation Baskets or Redemption Baskets.

To the extent

creations and redemptions involve the exchange of cash and cash equivalents, the Fund may incur certain costs including brokerage

costs or recognize gains or losses that it might not have incurred if the transaction were made in-kind.

Authorized Purchasers

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

Authorized Purchasers must be (1) either registered broker-dealers

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

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

To become an Authorized Purchaser, a person must

enter into an Authorized Purchaser Agreement with the Sponsor.

The Authorized Purchaser Agreement provides the procedures for

the creation and redemption of baskets and for the delivery of the cash and cash equivalents required for such creations and redemptions.

The Authorized Purchaser Agreement and the related procedures attached thereto may be amended by the Sponsor, without the consent

of any Shareholder, and the related procedures may generally be amended by the Sponsor without the consent of the Authorized Purchaser.

Authorized Purchasers pay a transaction fee of $300 to the Custodian for each creation order they place and a fee of $300 per

order for redemptions, which is a nominal fee.

Authorized Purchasers who make deposits with the Fund in exchange for baskets receive

no fees, commissions or other form of compensation or inducement of any kind from either the Trust or the Sponsor, and no such

person will have any obligation or responsibility to the Trust or the Sponsor to effect any sale or resale of Shares.

Fund creates and redeems Shares from time to time, but only in one or more Baskets.

Baskets are only created in exchange for delivery

to the Fund of the amount of bitcoin represented by the Baskets being created or an amount of cash sufficient purchase such amount of

bitcoin, the amount of which is equal to the combined NAV of the number of Shares included in the Baskets being created determined as

on the day the order to create the Baskets is properly received.

Baskets are only redeemed in exchange for delivery

to the Fund of the amount of Shares represented by the Basket.

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

Authorized Purchasers must be (1) either registered

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

as broker-dealers to engage in securities transactions as described below, and (2) DTC purchasers.

Registered broker-dealers are subject

to various requirements of the federal securities laws and rules, including financial responsibility rules such as the customer protection

rule, the net capital rule and recordkeeping requirements.

On May 15, 2025, the SEC’s Division of Trading and Markets and FINRA’s

Office of General Counsel withdrew their 2019 joint statement regarding broker-dealer custody of crypto asset securities, which was widely

perceived as prohibiting broker-dealers from offering custodial services for crypto assets that are not securities.

Additionally, on

the same day, the SEC released a set of Frequently Asked Questions (“FAQs”) clarifying its views on broker-dealers' crypto

asset activities.

The FAQs stated that (i) SEC Rule 15c3-3 applies only to crypto asset securities, and (ii) broker-dealers are permitted

to facilitate in-kind creations and redemptions in connection with spot crypto exchange-traded products.

become an Authorized Purchaser, a person must enter into an Authorized Purchaser Agreement with the Sponsor.

The Authorized Purchaser

Agreement provides the procedures for the creation and redemption of Baskets and for the delivery, or the facilitation of the delivery,

of the bitcoin or cash required for such creations and redemptions.

The Authorized Purchaser Agreement and the related procedures attached

thereto may be amended by the Sponsor, without the consent of any Shareholder, and the related procedures may generally be amended by

the Sponsor without the consent of the Authorized Purchaser.

Authorized Purchasers pay a transaction fee of $300 to the Bitcoin Custodian

for each creation order they place and a fee of $300 per order for redemptions, which is a nominal fee.

Authorized Purchasers who make

deposits with the Fund in exchange for Baskets receive no fees, commissions or other form of compensation or inducement of any kind from

either the Trust or the Sponsor, and no such person will have any obligation or responsibility to the Trust or the Sponsor to effect

any sale or resale of Shares.

Authorized Purchasers are expected to be capable of participating directly in the physical bitcoin and the bitcoin interest markets.

Some Authorized Purchasers or their affiliates may from time to time buy or sell bitcoin or bitcoin interests and may profit in

these instances.

Authorized Purchaser will be required to be registered as a broker-dealer under the Exchange Act and a member in good standing

with FINRA or be exempt from being or otherwise not required to be registered as a broker-dealer or a member of FINRA, and will

be qualified to act as a broker or dealer in the states or other jurisdictions where the nature of its business so requires.

Authorized Purchasers may also be regulated under federal and state banking laws and regulations.

Each Authorized Purchaser has

its own set of rules and procedures, internal controls and information barriers it deems appropriate in light of its own regulatory

the Authorized Purchaser Agreement, the Sponsor has agreed to indemnify the Authorized Purchasers against certain liabilities,

including liabilities under the 1933 Act, and to contribute to the payments the Authorized Purchasers may be required to make

in respect of those liabilities.

following description of the procedures for the creation and redemption of baskets is only a summary and an investor should refer

to the relevant provisions of the Trust Agreement and the form of Authorized Purchaser Agreement for more detail, each of which

has been incorporated by reference as an exhibit to the Annual Report.

any business day, an Authorized Purchaser may place an order with Global Fund Services in its capacity as the transfer agent to

create one or more baskets.

For purposes of processing purchase and redemption orders, a “business day” means any

day other than a day when any of NYSE Arca or the CME is closed for regular trading.

Purchase orders must be placed by 3:00 p.m.

(ET) or the close of regular trading on NYSE Arca, whichever is earlier.

The day on which the Marketing Agent receives a valid

purchase order is referred to as the purchase order date.

placing a purchase order, an Authorized Purchaser agrees to deposit cash and/or cash equivalents with the Fund, as described below.

Prior to the delivery of baskets for a purchase order, the Authorized Purchaser must also have wired to the Sponsor the non-refundable

transaction fee due for the purchase order.

Authorized Purchasers may not withdraw a purchase order without the prior consent

of the Sponsor in its discretion.

Some Authorized Purchasers or their affiliates may from time to time buy or sell bitcoin or bitcoin interests and may profit in these

Authorized Purchaser will be required to be registered as a broker-dealer under the Exchange Act and a member in good standing with FINRA

or be exempt from being or otherwise not required to be registered as a broker-dealer or a member of FINRA, and will 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 Purchasers

may also be regulated under federal and state banking laws and regulations.

Each Authorized Purchaser has its own set of rules and procedures,

internal controls and information barriers it deems appropriate in light of its own regulatory regime.

Authorized Purchasers will deliver cash or bitcoin to create Shares and will receive cash or bitcoin when redeeming Shares.

kind” creation transaction, Authorized Purchasers will deliver, or arrange for the delivery by the Authorized Purchaser’s

designee of, bitcoin to the Fund’s account with a Bitcoin Custodian in exchange for Shares when they purchase Shares.

kind” redemption transaction, when Authorized Purchasers redeem Shares with the Fund, the Fund, through a Bitcoin Custodian, will

deliver bitcoin to such Authorized Purchasers, or a designee thereof, in exchange for their Shares.

cash creation and redemption transactions, the Fund will engage in bitcoin transactions for converting cash into bitcoin (in association

with purchase orders) and bitcoin into cash (in association with redemption orders).

The Fund will conduct its transactions by trading

directly with third parties, who are not registered broker-dealers, pursuant to written agreements between such “Bitcoin Trading

Counterparties” and the Trust.

The Sponsor and the Trust expect to conduct these transactions by trading directly with Bitcoin

Trading Counterparties.

As of the date of this Form 10-K, Nonco LLC has been approved as a Bitcoin Trading Counterparty.

Bitcoin Trading

Counterparties may be added at any time, subject to the discretion of the Sponsor.

In the event the Sponsor engages any additional Bitcoin

Trading Counterparties, shareholders will be notified of the addition of such Bitcoin Trading Counterparty through a prospectus supplement

and/or a current report on Form 8-K or through the Trust’s annual or quarterly reports, or through the Trust’s website.

Trust will create Shares by receiving crypto assets from the Authorized Participant.

The Trust will redeem Shares by delivering crypto

assets to the Authorized Participant.

the Authorized Purchaser Agreement, the Sponsor has agreed to indemnify the Authorized Purchasers against certain liabilities, including

liabilities under the 1933 Act, and to contribute to the payments the Authorized Purchasers may be required to make in respect of those

following description of the procedures for the creation and redemption of Baskets is only a summary and an investor should refer to

the relevant provisions of the Trust Agreement and the form of Authorized Purchaser Agreement.

any business day, an Authorized Purchaser may place an order with Global Fund Services in its capacity as the Transfer Agent to create

one or more Baskets.

Currently, creation orders are accepted in cash or in-kind.

For purposes of processing purchase and redemption orders,

a “business day” means any day other than a day when NYSE Arca is closed for regular trading.

Purchase orders must be placed

E.T., or the close of regular trading on NYSE Arca, whichever is earlier (the “Order Cutoff Time”).

Cutoff Time may be modified by the Sponsor in its sole discretion.

The day on which the Global Fund Services receives a valid purchase

order is referred to as the purchase order date.

The Fund may require any Baskets being created that are greater than 5% of the Fund’s

NAV to be pre-funded with cash or other acceptable consideration.

manner by which creations are made is dictated by the terms of the Authorized Purchaser Agreement.

By placing a creation order, an Authorized

Purchaser agrees to facilitate the deposit of cash with the Cash Custodian, or bitcoin with the Bitcoin Custodian.

If an Authorized Purchaser

fails to consummate the foregoing, the order will be cancelled.

Prior to the delivery of Baskets for a purchase order, the Authorized

Purchaser must also have wired to the Cash Custodian the non-refundable transaction fee due for the purchase order.

Authorized Purchasers

may not withdraw a purchase order without the prior consent of the Sponsor in its discretion.

a cash creation, the total deposit of cash required to create each Basket is an amount of cash that is in the same proportion to the

total assets of the Fund, net of accrued expenses and other liabilities, on the date the order to purchase is properly received, as the

number of Shares to be created under the purchase order is in proportion to the total number of Shares outstanding on the date the order

On the trade date for a purchase order (the “Creation Trade Date”), following receipt of the purchase order

from the Authorized Purchaser, the Sponsor will choose, in its sole discretion, which Bitcoin Trading Counterparty to buy the bitcoin

in exchange for the cash proceeds from such purchase order.

For settlement of a creation, the Fund delivers Shares to the Authorized

Purchaser in exchange for cash received from the Authorized Purchaser.

Meanwhile, the Bitcoin Trading Counterparty delivers the required

bitcoin in exchange for cash.

In the event the Fund has not been able to successfully execute and complete settlement of a bitcoin transaction

by the settlement date of the purchase order, the Authorized Purchaser will be given the option to (1) cancel the purchase order, or

(2) accept that the Fund will continue to attempt to complete the execution, which will delay the settlement date of the purchase order.

With respect to a purchase order, as between the Fund and the Authorized Purchaser, the Authorized Purchaser is responsible for the dollar

cost of the difference between the bitcoin price utilized in calculating NAV on trade date and the price at which the Fund acquires the

bitcoin to the extent the price realized in buying the bitcoin is higher than the price utilized in the NAV.

To the extent the price

realized in buying crypto assets is lower than the price utilized in the NAV, the Authorized Purchaser shall keep the dollar impact of

any such difference.

an in-kind creation, following an Authorized Purchaser’s purchase order, the Fund’s Bitcoin Custodian account must be credited

with the required bitcoin by the end of the business day following the purchase order date, or in the case of cash deposits, the Fund’s

Cash Custodian account must be credited with the required cash by the end of the business day following the purchase order date, as applicable.

If the Authorized Purchaser or its designee fails to consummate the foregoing, the order shall be cancelled.

Upon receipt of the bitcoin

deposit amount in the Fund’s Bitcoin Custodian account, or the cash deposit amount in the Fund’s Cash Custodian account,

the Bitcoin Custodian or Cash Custodian, respectively, will notify the Transfer Agent, the Authorized Purchaser, and the Sponsor that

the bitcoin or cash has been deposited.

The Transfer Agent will then direct DTC to credit the number of Shares created to the applicable

Shares will be issued unless and until the applicable Bitcoin Custodian (in the case of in-kind deposits) or Cash Custodian (in the case

of cash deposits) has informed the Transfer Agent that the bitcoin or cash (as applicable) has been received.

Disruption of services

at the Bitcoin Custodian would have the potential to delay settlement of the Bitcoin related to Share creations.

To the extent a Bitcoin

Trading Counterparty, is not able to deliver bitcoin associated with a cash purchase order as of a specified time on the settlement date,

the Authorized Purchasers have the option to cancel the order, or the Sponsor may select an alternative execution method for the bitcoin

To the extent that bitcoin transfers in connection with a creation order are delayed due to congestion or other issues with

the Bitcoin Network, such bitcoin will not be held in cold storage until such transfers occur.

held in the Fund’s Bitcoin Custodian accounts is the property of the Fund and is not leased, or loaned under any circumstances.

Determination

of Required Deposits

total deposit required to create each basket (“Creation Basket Deposit”) is the amount of cash and/or cash equivalents

that is in the same proportion to the total assets of the Fund (net of estimated accrued but unpaid fees, expenses and other liabilities)

on the purchase order date as the number of Shares to be created under the purchase order is in proportion to the total number

of Shares outstanding on the purchase order date.

The Sponsor determines, directly in its sole discretion or in consultation with

the Custodian and the Sub-Administrator, the requirements for cash and/or cash equivalents, including the remaining maturities

of the cash equivalents, which may be included in deposits to create baskets.

If cash equivalents are to be included in a Creation

Basket Deposit for orders placed on a given business day, the Sub-Administrator will publish an estimate of the Creation Basket

Deposit requirements at the beginning of such day.

a creation, the total amount of bitcoin (for in-kind creations), or cash (for cash creations), required to create each Basket (the “Basket

Deposit”) is the amount of bitcoin or its cash equivalent that is in the same proportion to the total assets of the Trust, net

of accrued expenses and other liabilities, as the number of Shares being created bears to the total number of Shares outstanding on the

date the order is properly received.

Basket Deposit changes from day to day.

On each day that the Exchange is open for regular trading, the Administrator adjusts the quantity

of bitcoin represented by the Basket Deposit as appropriate to reflect accrued expenses and any loss of bitcoin that may occur.

The computation

is made by the Administrator as promptly as practicable after 4:00 p.m.

Each night, the Sponsor will publish the amount of bitcoin

that is represented by each Basket Deposit.

a creation occurs, after the Bitcoin Custodian receives the required bitcoin (for in-kind creations) or a Cash Custodian receives the

required cash (for cash creations), the Sponsor will notify the Transfer Agent that the bitcoin or cash, as applicable, has been received

and the Sponsor and Transfer Agent will then determine whether any outstanding cash or bitcoin due from the Authorized Participant has

been settled with the Trust, and the Transfer Agent will direct DTC to credit the number of Shares ordered to the Authorized Participant’s

DTC account on the business day following the purchase order date.

of Required Deposits

Authorized Purchaser who places a purchase order is responsible for transferring to the Fund’s account with the Custodian

the required amount of cash and cash equivalents by the end of the next business day following the purchase order date or by the

end of such later business day, not to exceed three business days after the purchase order date, as agreed to between the Authorized

Purchaser and the Custodian when the purchase order is placed (the “Purchase Settlement Date”).

Upon receipt of the

deposit amount, the Custodian directs DTC to credit the number of baskets ordered to the Authorized Purchaser’s DTC account

on the Purchase Settlement Date.

orders to purchase baskets must be placed by 3:00 p.m.

(ET), but the total payment required to create a basket during the continuous

offering period will not be determined until 4:00 p.m.

(ET), on the date the purchase order is received, Authorized Purchasers

will not know the total amount of the payment required to create a basket at the time they submit an irrevocable purchase order

for the basket.

The Fund’s NAV and the total amount of the payment required to create a basket could rise or fall substantially

between the time an irrevocable purchase order is submitted and the time the amount of the purchase price in respect thereof is

of Purchase Orders

Sponsor acting by itself or through the Marketing Agent or transfer agent may reject a purchase order or a Creation Basket Deposit

determines that, due to position limits or otherwise, investment alternatives that will

enable the Fund to meet its investment objective are not available or practicable at

determines that the purchase order or the Creation Basket Deposit is not in proper form;

believes that acceptance of the purchase order or the Creation Basket Deposit would have

adverse tax consequences to the Fund or its Shareholders;

acceptance or receipt of the Creation Basket Deposit would, in the opinion of counsel

to the Sponsor, be unlawful;

an in-kind creation, following an Authorized Purchaser’s purchase order, the Fund’s Bitcoin Custodian accounts must be credited

with the required bitcoin by the end of the business day following the purchase order date, or in the case of cash deposits, the Trust’s

Cash Custodian account must be credited with the required cash by the end of the business day following the purchase order date, as applicable.

Under most circumstances, the bitcoin associated with a Basket Deposit will be deposited with the Bitcoin Custodian.

Upon receipt of

the bitcoin deposit amount in the Fund’s Bitcoin Custodian accounts, or the cash deposit amount in the Fund’s Cash Custodian

account, the Bitcoin Custodian or the Cash Custodian, as applicable, will notify the Transfer Agent, the Authorized Purchaser and the

Sponsor that the bitcoin or cash has been deposited.

Upon confirmation by the Sponsor and Transfer Agent that any outstanding bitcoin

or cash due from the Authorized Purchaser has been settled with the Trust, the Transfer Agent will then direct DTC to credit the number

of Shares created to the applicable DTC account of the Authorized Participant.

Authorized Purchaser understands and agrees that in the event the Basket Deposit is not deposited to the Trust by the time specified

above and in compliance with the applicable procedures, and any outstanding cash or bitcoin due from the Authorized Purchaser has not

been settled with the Fund, the applicable purchase order will be canceled by the Sponsor.

In the event the Authorized Purchaser, or

its designated agent or client, has not deposited the bitcoin to the Fund by the applicable time on the settlement date of the in-kind

creation order, the Authorized Purchaser will be 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, or (3) accept that the Fund will execute a bitcoin transaction required for the

creation and the Authorized Purchaser will deliver the U.S.

dollars required for this purchase.

The Authorized Purchaser is responsible

for the dollar cost of the difference between the bitcoin price utilized in calculating NAV per Share on trade date and the price at

which the Fund acquires the bitcoin to the extent the price realized in buying the bitcoin is higher than the bitcoin price utilized

To the extent the price realized in buying the bitcoin is lower than the price utilized in the NAV, the Authorized Purchaser

shall get to keep the dollar impact of any such difference.

of the Sponsor, the Trust, the Marketing Agent, or Global Fund Services shall be liable to the Authorized Purchaser if a Bitcoin Trading

Counterparty fails to deliver bitcoin or cash, respectively, representing the Basket Deposit for such Authorized Purchaser’s purchase

order to the Fund’s account with the Bitcoin Custodian or Cash Custodian, as applicable, unless such failure is due to an act or

omission of the Sponsor or Trust.

and Rejection of Purchase Orders

Sponsor holds the discretion to suspend purchase orders or delay their settlement in specific situations.

These may include (1) exchange

closures or trading restrictions, (2) emergencies (including but not limited to:

an interruption in services or availability of the Bitcoin

Custodian, Cash Custodian, Administrator, or other service providers to the Trust, acts of God, catastrophe, civil disturbance, government

prohibition, war, terrorism, strike or other labor dispute, fire, force majeure, interruption in telecommunications, Internet services,

or network provider services, unavailability of Fedwire, SWIFT or banks’ payment processes, significant technical failure, bug,

error, disruption or fork of the bitcoin network, hacking, cybersecurity breach, or power, Internet, or Bitcoin Network outage, or similar

event), (3) shareholder protection needs, or (4) when it’s not in the best interest of the Fund or its investors.

Purchase orders

must conform to the criteria outlined in the Authorized Purchaser Agreement and be for whole Baskets.

The Sponsor may suspend orders

that don’t meet these criteria.

The Sponsor will provide notice to the Fund’s shareholders by posting a notification to the

Fund’s website.

In addition, the Sponsor intends to file a current report on Form 8-K in order to inform shareholders of the suspension

of creations.

Sponsor acting by itself or through the Marketing Agent or Transfer Agent may reject a purchase order or a Basket Deposit if:

determines that the purchase order or the Basket Deposit is not in proper form;

believes that acceptance of the purchase order or the Basket Deposit would have adverse tax

consequences to the Fund or its shareholders;

acceptance or receipt of the Basket Deposit would, in the opinion of counsel to the Sponsor,

● circumstances

outside the control of the Sponsor, Marketing Agent or transfer agent make it, for all

practical purposes, not feasible to process creations of baskets;

is a possibility that any or all of the Bitcoin Futures Contracts of the Fund on the

CME from which the NAV of the Fund is calculated will be priced at a dynamic price limit

in the sole discretion of the Sponsor, the execution of such an order would not be in

the best interest of the Fund or its Shareholders.

of the Sponsor, Marketing Agent or transfer agent will be liable for the rejection of any purchase order or Creation Basket Deposit.

outside the control of the Sponsor, Marketing Agent or Transfer Agent make it, for all practical

purposes, not feasible to process creations of Baskets;

in the sole discretion of the Sponsor, the execution of such an order would not be in the

best interest of the Fund or its shareholders.

of the Sponsor, Marketing Agent or Transfer Agent will be liable for the rejection of any purchase order or Basket Deposit.

procedures by which an Authorized Purchaser can redeem one or more Baskets mirror the procedures for the creation of Baskets.

On any business day, an Authorized Purchaser may place an order with the transfer agent to redeem one or more baskets.

orders must be placed by 3:00 p.m.

(ET) or the close of regular trading on the NYSE Arca, whichever is earlier.

A redemption order

so received will be effective on the date it is received in satisfactory form by the Marketing Agent.

The redemption procedures

allow Authorized Purchasers to redeem baskets and do not entitle an individual Shareholder to redeem any Shares in an amount less

than a Redemption Basket, or to redeem baskets other than through an Authorized Purchaser.

By placing a redemption order, an Authorized

Purchaser agrees to deliver the baskets to be redeemed through DTC’s book-entry system to the Fund by the end of the next

business day following the effective date of the redemption order or by the end of such later business day.

Prior to the delivery

of the redemption distribution for a redemption order, the Authorized Purchaser must also have wired to the Sponsor’s account

at the Custodian the non-refundable transaction fee due for the redemption order.

An Authorized Purchaser may not withdraw a redemption

order without the prior consent of the Sponsor in its discretion.

business day, an Authorized Purchaser may place an order with the Transfer Agent to redeem one or more Baskets.

Redemption orders must

be placed by 3:00 p.m.

or the close of regular trading on NYSE Arca, whichever is earlier.

A redemption order so received will be

effective on the date it is received in satisfactory form by the Marketing Agent.

The redemption procedures allow Authorized Purchasers

to redeem Baskets and do not entitle an individual shareholder to redeem any Shares in an amount less than a Basket, or to redeem Baskets

other than through an Authorized Purchaser.

By placing a redemption order, an Authorized Purchaser agrees to deliver the Baskets to be

redeemed through DTC’s book-entry system to the Fund by the end of the next business day following the effective date of the redemption

order or by the end of such later business day (the “Redemption Settlement Date”).

Prior to the delivery of the redemption

distribution for a redemption order, the Authorized Purchaser must also have wired to the Sponsor’s account at the Cash Custodian

the non-refundable transaction fee due for the redemption order.

An Authorized Purchaser may not withdraw a redemption order without

the prior consent of the Sponsor in its discretion.

Determination

of Redemption Distribution

redemption distribution from the Fund consists of a transfer to the redeeming Authorized Purchaser of an amount of cash and/or

cash equivalents that is in the same proportion to the total assets of the Fund (net of estimated accrued but unpaid fees, expenses

and other liabilities) on the date the order to redeem is properly received as the number of Shares to be redeemed under the redemption

order is in proportion to the total number of Shares outstanding on the date the order is received.

The Sponsor, directly or in

consultation with the Custodian and the Sub-Administrator, determines the requirements for cash and/or cash equivalents, including

the remaining maturities of the cash equivalents and cash, which may be included in distributions to redeem baskets.

If cash equivalents

are to be included in a redemption distribution for orders placed on a given business day, the Custodian and Sub-Administrator

will publish an estimate of the redemption distribution composition as of the beginning of such day.

redemption distribution for cash redemptions from the Fund consists of a transfer to the redeeming Authorized Purchaser of an amount

of cash that is in the same proportion to the total assets of the Fund (net of estimated accrued but unpaid fees, expenses and other

liabilities) on the date the order to redeem is properly received as the number of Shares to be redeemed under the redemption order is

in proportion to the total number of Shares outstanding on the date the order is received.

The redemption distribution for in-kind redemptions

from the Fund consists of a transfer to the Authorized Purchaser or its designated agent or client of an amount of bitcoin equal to the

NAV of the Fund multiplied by the number of Shares to be redeemed under the redemption order.

of Redemption Distribution

redemption distribution due from a Fund will be delivered to the Authorized Purchaser on the Redemption Settlement Date if the

Fund’s DTC account has been credited with the baskets to be redeemed.

If the Fund’s DTC account has not been credited

with all of the baskets to be redeemed by the end of such date, the redemption distribution will be delivered to the extent of

whole baskets received.

Any remainder of the redemption distribution will be delivered on the next business day after the Redemption

Settlement Date to the extent of remaining whole baskets received.

Pursuant to information from the Sponsor, the Custodian will

also be authorized to deliver the redemption distribution notwithstanding that the baskets to be redeemed are not credited to

the Fund’s DTC account by noon (ET) on the Redemption Settlement Date if the Authorized Purchaser has collateralized its

obligation to deliver the baskets through DTC’s book-entry system on such terms as the Sponsor may from time to time determine.

the case of a cash redemption, the Fund, through the Cash Custodian, will deliver cash to the Authorized Purchasers when they redeem

Shares with the Fund.

This distribution of cash will be delivered to the Authorized Purchaser on the business day following the Redemption

Order Date if, by 3:00 p.m.

on such business day (or another time as determined by Sponsor), the Fund’s DTC account has been

credited with the Baskets to be redeemed.

If the Fund’s DTC account has not been credited with all of the Baskets to be redeemed

by such time, the redemption distribution will also be delayed.

In the case of an in-kind redemption, the Fund will deliver bitcoin to

the Authorized Purchasers (or their designated agents or clients) when they redeem Shares with the Fund.

This distribution of bitcoin

will be delivered to the Authorized Purchaser (or its designated agent or client) on the business day following the Redemption Order

Date if, by 3:00 p.m.

on such business day (or another time as determined by Sponsor), the Fund’s DTC account has been credited

with the Baskets to be redeemed by such time.

If the Fund’s DTC account has not been credited with all of the Baskets to be redeemed

by such time, the redemption distribution will also be delayed.

or Rejection of Redemption Orders

Sponsor may, in its discretion, suspend the right of redemption, or postpone the redemption settlement date, (1) for any period

during which NYSE Arca or CME is closed other than customary weekend or holiday closings, or trading on NYSE Arca or CME is suspended

or restricted, (2) for any period during which an emergency exists as a result of which delivery, disposal or evaluation of cash

equivalents is not reasonably practicable, (3) for such other period as the Sponsor determines to be necessary for the protection

of the Shareholders, (4) if there is a possibility that any or all of the Bitcoin Futures Contracts of the Fund on the CME from

which the NAV of the Fund is calculated will be priced at a daily price limit restriction, or (5) if, in the sole discretion of

the Sponsor, the execution of such an order would not be in the best interest of the Fund or its Shareholders.

For example, the

Sponsor may determine that it is necessary to suspend redemptions to allow for the orderly liquidation of the Fund’s assets

at an appropriate value to fund a redemption.

Sponsor may, in its discretion, suspend the right of redemption, or postpone the Redemption Settlement Date, (1) for any period during

which NYSE Arca is closed other than customary weekend or holiday closings, or trading on NYSE Arca is suspended or restricted, (2) for

any period during which an emergency exists as a result of which delivery, disposal or evaluation of cash equivalents is not reasonably

practicable, (3) for such other period as the Sponsor determines to be necessary for the protection of the shareholders, or (4) if, in

the sole discretion of the Sponsor, the execution of such an order would not be in the best interest of the Fund or its shareholders.

For example, the Sponsor may determine that it is necessary to suspend redemptions to allow for the orderly liquidation of the Fund’s

assets at an appropriate value to fund a redemption.

If the Sponsor has difficulty liquidating the Fund’s positions, e.g., because

of a market disruption event in the futures markets, it may be appropriate to suspend redemptions until such time as such circumstances

of a market disruption event in the bitcoin markets, it may be appropriate to suspend redemptions until such time as such circumstances

are rectified.

None of the Sponsor, the Marketing Agent or the transfer agent will be liable to any person or in any way for any

loss or damages that may result from any such suspension or postponement.

None of the Sponsor, the Marketing Agent, or the Transfer Agent will be liable to any person or in any way for any loss

or damages that may result from any such suspension or postponement.

The Sponsor intends to file a current report on Form 8-K in order

to inform investors of the suspension of redemptions.

orders must be made in whole Baskets.

The Sponsor will reject a redemption order if the order is not in proper form as described

in the Authorized Purchaser Agreement or if the fulfillment of the order, in the opinion of its counsel, might be unlawful.

Sponsor may also reject a redemption order if the number of Shares being redeemed would reduce the remaining outstanding Shares

below 50,000 Shares (i.e., five baskets of 10,000 Shares each) or less, unless the Sponsor has reason to believe that the placer

of the redemption order does in fact possess all the outstanding Shares of the Fund and can deliver them.

The Sponsor will reject a redemption order if the order is not in proper form as described in the

Authorized Purchaser Agreement or if the fulfillment of the order, in the opinion of its counsel, might be unlawful.

The Sponsor may

also reject a redemption order if the number of Shares being redeemed would reduce the remaining outstanding Shares below 50,000 Shares

(i.e., five Baskets of 10,000 Shares each) or less, unless the Sponsor has reason to believe that the placer of the redemption order

does in fact possess all the outstanding Shares of the Fund and can deliver them.

and Redemption Transaction Fees

compensate for expenses in connection with the creation and redemption of baskets, an Authorized Purchaser is required to pay

a transaction fee of $300 per order to the Custodian.

The transaction fees may be reduced, increased or otherwise changed by the

compensate for expenses in connection with the creation and redemption of Baskets, an Authorized Purchaser is required to pay a transaction

fee of $300 per order to the Cash Custodian.

The transaction fees may be reduced, increased or otherwise changed by the Sponsor.

$300 fee may not be used by the Fund to cover expenses related to creations and redemptions.

Responsibility

Purchasers 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 baskets, regardless of whether or not such tax or charge is imposed

directly on the Authorized Purchaser, and agree to indemnify the Sponsor and the Fund if they are required by law to pay any such

tax, together with any applicable penalties, additions to tax and interest thereon.

Purchasers 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 Baskets, regardless of whether or not such tax or charge is imposed directly on the

Authorized Purchaser, and agree to indemnify the Sponsor and the Fund if they are required by law to pay any such tax, together with

any applicable penalties, additions to tax and interest thereon.

Market Transactions

noted, the Fund will create and redeem Shares from time to time, but only in one or more Creation Baskets or Redemption Baskets.

The creation and redemption of baskets are only made in exchange for delivery to the Fund or the distribution by the Fund of the

amount of cash and cash equivalents equal to the total NAV of the number of Shares included in the baskets being created or redeemed

determined on the day the order to create or redeem baskets is properly received.

noted, the Fund will create and redeem Shares from time to time, but only in one or more Baskets.

The creation and redemption of Baskets

are only made in exchange for delivery to the Fund or the distribution by the Fund of the amount of cash and cash equivalents, or bitcoin,

equal to the total NAV of the number of Shares included in the Baskets being created or redeemed determined on the day the order to create

or redeem Baskets is properly received.

discussed above, Authorized Purchasers are the only persons that may place orders to create and redeem Baskets.

Authorized Purchasers

must be registered broker-dealers or other securities market purchasers, such as banks and other financial institutions that are

not required to register as broker-dealers to engage in securities transactions.

An Authorized Purchaser is under no obligation

to create or redeem baskets, and an Authorized Purchaser is under no obligation to offer to the public Shares of any baskets it

Authorized Purchasers that do offer to the public Shares from the baskets they create will do so at per Share offering

prices that are expected to reflect, among other factors, the trading price of the Shares on NYSE Arca, the NAV of the Shares

at the time the Authorized Purchaser purchased the Creation 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 the bitcoin interest markets.

prices of Shares offered by Authorized Purchasers are expected to fall between the Fund’s NAV and the trading price of the

Shares on NYSE Arca at the time of sale.

Shares initially comprising the same basket but offered by Authorized Purchasers to the

public at different times may have different offering prices.

An order for one or more baskets may be placed by an Authorized

Purchaser on behalf of multiple clients.

Shares are expected to trade in the secondary market on NYSE Arca.

Shares may trade in

the secondary market at prices that are lower or higher relative to their NAV per Share.

The amount of the discount or premium

in the trading price relative to the NAV per Share may be influenced by various factors, including the number of investors who

seek to purchase or sell Shares in the secondary market and the liquidity of the bitcoin interest markets.

While the Shares trade

on NYSE Arca until 4:00 p.m.

(ET), liquidity in the markets for bitcoin interests may be reduced after the close of the CME.

a result, during this time, trading spreads, and the resulting premium or discount, on the Shares may widen.

Sponsor causes the Fund to transfer the proceeds of the sale of Creation Baskets to the Custodian or another financial institution

for use in trading activities and/or investment in bitcoin and Bitcoin Futures Contracts and cash and cash equivalents.

invests the Fund’s assets in bitcoin and Bitcoin Futures Contracts and cash and cash equivalents.

connection with acceptance of a Creation Order, the Sponsor, on behalf of the Fund, purchases Bitcoin Futures Contracts in an

amount equivalent to the Creation Basket Deposit (which is already net of estimated accrued but unpaid fees, expenses and other

liabilities) and, subsequently, may engage in an EFP transaction to exchange this futures position for spot bitcoin, pursuant

to the Fund’s investment strategy.

The Fund’s policy is to invest cash received from Creation Orders to acquire the

largest quantity of whole BTC Contracts that can be then converted into bitcoin through EFP transactions.

Such bitcoin positions,

which are normally expected to be 95% of the Fund’s net asset value, are held by the Bitcoin Custodian on behalf of the

To the extent cash balances remain in the Fund after the acquisition of BTC Contracts, the Fund’s policy is then use

available cash from Creation Orders to acquire the largest quantity of whole MBT Contracts.

All Bitcoin Futures Contracts will

be held by the Fund’s FCMs.

The Fund’s policy is to maintain cash for margin requirements of Bitcoin Futures Contracts,

as discussed below, and any remaining cash after acquisition of MBT Contracts to be invested in cash equivalents.

Margin accounts

will be maintained by the Fund’s FCMs.

Any remaining Fund cash and cash equivalents will be maintained by the Cash Custodian

on behalf of the Fund.

in connection with a Redemption Order, the Sponsor, on behalf of the Fund, may engage in an EFP Transaction to exchange its spot

bitcoin position for a long futures position and, subsequently sell Bitcoin Futures Contracts in an amount equivalent to the redemption

distribution.

The Fund’s policy is to convert through EFP transactions the smallest quantity of bitcoin to BTC Contracts

that then will be sold for cash so that, when aggregated with the Fund’s liquidation proceeds from any MBT Contract and

cash equivalent disposition and any other cash held by the Fund, the BTC Contract sale proceeds will be equal to the settlement

payment for a Redemption Order;

provided that bitcoin will constitute at least 95% of the Fund’s net asset value.

policy in connection with redemptions is to first liquidate cash equivalents and then liquidate the Fund’s Bitcoin Futures

general, the Fund expects that it will be required to post approximately 32% of the previous day settlement price of a Bitcoin

Futures Contracts as initial margin.

Ongoing margin and collateral payments will generally be required for exchange-traded bitcoin

interests based on changes in the value of the bitcoin interests.

In light of the differing requirements for initial payments

under exchange-traded bitcoin interests and the fluctuating nature of ongoing margin and collateral payments, it is not possible

to estimate what portion of the Fund’s assets will be posted as margin or collateral at any given time.

Cash and cash equivalents

held by the Fund constitute reserves that are available to meet ongoing margin and collateral requirements or pay current obligations

All interest or other income is used for the Fund’s benefit.

FCM, counterparty, government agency or exchange could increase margin or collateral requirements applicable to the Fund to hold

trading positions at any time.

Moreover, margin is merely a security deposit and has no bearing on the profit or loss potential

for any positions held.

approximate 1-3% of the Fund’s assets held by the FCM are held in segregation pursuant to the CEA and CFTC regulations.

APs with which the Sponsor will engage in EFP transactions are unaffiliated third-parties that must be approved by the Sponsor

and all transactions will be done on an arms-length basis, at commercially reasonable price and terms, pursuant specific rules

of the CME and CFTC guidance.

The Sponsor seeks to diversify its pool of APs to achieve best execution and has identified at least

seven APs that are available to support EFP transactions for the Fund.

An non-exhaustive list of firms that have provided permission

to CME to be listed as liquidity providers in the context of block trades and EFP transactions on bitcoin on the CME market is

available at https://www.cmegroup.com/trading/bitcoin-brokers-and-block-liquidity-providers.html .

As of the date hereof,

Cumberland DRW LLC, Flow Traders B.V., JSCT, LLC, XBTO International Ltd, DV Chain, LLC, GSR Markets Ltd., B2C2 USA, Inc.

Nonco LLC have been approved as APs.

Jane Street Capital, LLC, one of the Authorized Purchasers, is an affiliate of JSCT, LLC,

one of the APs.

Current or future APs may be affiliates or, or have material relationships with, the Fund’s current or future

Authorized Purchasers.

Sponsor believes that both the spot bitcoin and the CME Bitcoin Futures Market are sufficiently liquidity to support EFP transactions

in the context of the Fund’s investment strategy and continuously monitor market conditions to ensure that transactions

align with the Fund’s investment objectives.

However, there is a risk that the Fund won’t be able to negotiate transactions

in sufficient quantities to follow its investment strategy.

The Sponsor may choose to limit the size of EFP transactions or avoid

transacting at all when it deems so doing to be in the best interest of Shareholders.

It may choose to do so when it believes

the market is too volatile to execute a bitcoin transaction, when it believes the price of bitcoin is being inconsistently, irregularly,

or discontinuously published from bitcoin trading venues and other data sources, or when it believes other similar circumstances

may create a scenario in which executing an EFP transaction would not be in the best interests of the Shareholders.

In those cases,

the Fund may end up being under or over exposed to bitcoin in relation to its intended investment strategy.

must be registered broker-dealers or other securities market purchasers, such as banks and other financial institutions that are not

required to register as broker-dealers to engage in securities transactions.

An Authorized Purchaser is under no obligation to create

or redeem Baskets, and an Authorized Purchaser is under no obligation to offer to the public Shares of any Baskets it does create.

Purchasers that do offer to the public Shares from the Baskets they create will do so at per Share offering prices that are expected

to reflect, among other factors, the trading price of the Shares on NYSE Arca, the NAV of the Shares at the time the Authorized Purchaser

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 the bitcoin interest markets.

The prices of Shares offered by Authorized Purchasers are expected

to fall between the Fund’s NAV and the trading price of the Shares on NYSE Arca at the time of sale.

Shares initially comprising

the same Basket but offered by Authorized Purchasers to the public at different times may have different offering prices.

one or more Baskets may be placed by an Authorized Purchaser on behalf of multiple clients.

Shares are expected to trade in the secondary

market on NYSE Arca.

Shares may trade in the secondary market at prices that are lower or higher relative to their NAV per Share.

amount of the discount or premium in the trading price relative to the NAV per Share may be influenced by various factors, including

the number of investors who seek to purchase or sell Shares in the secondary market and the liquidity of the bitcoin interest markets.

While the Shares trade on NYSE Arca until 4:00 p.m.

E.T., liquidity in the markets for bitcoin interests may be reduced after the close

As a result, during this time, trading spreads, and the resulting premium or discount, on the Shares may widen.

Sponsor applies substantially all of the Fund’s assets toward investing in bitcoin.

The Fund conducts creation and redemptions

in cash or in-kind with Authorized Purchasers.

Proceeds received by the Fund from the issuance of Baskets consist of bitcoin or cash.

Deposits of bitcoin are held by the Bitcoin Custodian on behalf of the Fund.

Deposits of cash are held by the Cash Custodian.

expects that all entities that will hold or trade the Fund’s assets will be based in the United States and will be subject to United

States regulations.

Trust Agreement

following paragraphs are a summary of certain provisions of the Trust Agreement.

The following discussion is qualified in its

entirety by reference to the Trust Agreement.

The following discussion is qualified in its entirety

by reference to the Trust Agreement.

of the Sponsor

Sponsor is generally authorized to perform all acts deemed necessary to carry out the purposes of the Trust and to conduct the

business of the Trust.

Sponsor is generally authorized to perform all acts deemed necessary to carry out the purposes of the Trust and to conduct the business

of the Trust.

The Trust and the Fund will continue to exist until terminated in accordance with the Trust Agreement.

Sponsor’s Obligations

addition to the duties imposed by the Delaware Trust Statute, under the Trust Agreement the Sponsor has obligations as a Sponsor

of the Trust, which include, among others, responsibility for certain organizational and operational requirements of the Trust,

as well as fiduciary responsibility for the safekeeping and use of the Trust’s assets, whether or not in the Sponsor’s

immediate possession or control.

the extent that, at law (common or statutory) or in equity, the Sponsor has duties (including fiduciary duties) and liabilities

relating thereto to the Trust, the Fund, the Shareholders or to any other person, the Sponsor will not be liable to the Trust,

the Fund, the Shareholders or to any other person for its good faith reliance on the provisions of the Trust Agreement unless

such reliance constitutes gross negligence or willful misconduct on the part of the Sponsor.

The provisions of the Trust Agreement,

to the extent they restrict or eliminate the duties and liabilities of the Sponsor otherwise existing at law or in equity, replace

such other duties and liabilities of the Sponsor.

addition to the duties imposed by the DSTA, under the Trust Agreement the Sponsor has obligations as a Sponsor of the Trust, which include,

among others, responsibility for certain organizational and operational requirements of the Trust, as well as fiduciary responsibility

for the safekeeping and use of the Trust’s assets, whether or not in the Sponsor’s immediate possession or control.

the extent that, at law (common or statutory) or in equity, the Sponsor has duties (including fiduciary duties) and liabilities relating

thereto to the Trust, the Fund, the shareholders or to any other person, the Sponsor will not be liable to the Trust, the Fund, the shareholders

or to any other person for its good faith reliance on the provisions of the Trust Agreement unless such reliance constitutes gross negligence

or willful misconduct on the part of the Sponsor.

The provisions of the Trust Agreement, to the extent they restrict or eliminate the

duties and liabilities of the Sponsor otherwise existing at law or in equity, replace such other duties and liabilities of the Sponsor.

and Indemnification

the Trust Agreement, the Sponsor, the Trustee and their respective Affiliates (collectively, “Covered Persons”) shall

have no liability to the Trust, the Fund, or to any Shareholder for any loss suffered by the Trust or the Fund which arises out

of any action or inaction of such Covered Person if such Covered Person, in good faith, determined that such course of conduct

was in the best interest of the Trust or the Fund and such course of conduct did not constitute gross negligence or willful misconduct

of such Covered Person.

Subject to the foregoing, neither the Sponsor nor any other Covered Person shall be personally liable

for the return or repayment of all or any portion of the capital or profits of any Shareholder or assignee thereof, it being expressly

agreed that any such return of capital or profits made pursuant to the Trust Agreement shall be made solely from the assets of

the Fund without any rights of contribution from the Sponsor or any other Covered Person.

A Covered Person shall not be liable

for the conduct or willful misconduct of any administrator or other delegate selected by the Sponsor with reasonable care, provided,

however, that the Trustee and its Affiliates shall not, under any circumstances be liable for the conduct or willful misconduct

of any administrator or other delegate or any other person selected by the Sponsor to provide services to the Trust.

Trust Agreement also provides that the Sponsor shall be indemnified by the Trust (or by a series separately to the extent the

matter in question relates to a single series or disproportionately affects a specific series in relation to other series) against

any losses, judgments, liabilities, expenses (excluding any taxes on the compensation received for services as Sponsor or on indemnity

payments received), and amounts paid in settlement of any claims sustained by it in connection with its activities for the Trust,

provided that (i) the Sponsor was acting on behalf of or performing services for the Trust and has determined, in good faith,

that such course of conduct was in the best interests of the Trust and such liability or loss was not the result of gross negligence,

willful misconduct, or a breach of the Trust Agreement on the part of the Sponsor and (ii) any such indemnification will only

be recoverable from the assets of the applicable series.

The Sponsor’s rights to indemnification permitted under the Trust

Agreement shall not be affected by the dissolution or other cessation to exist of the Sponsor, or the withdrawal, adjudication

of bankruptcy or insolvency of the Sponsor, or the filing of a voluntary or involuntary petition in bankruptcy under Title 11

of the Bankruptcy Code by or against the Sponsor.

the Trust Agreement, the Sponsor, the Trustee and their respective affiliates (collectively, the “Covered Persons”) shall

have no liability to the Trust, the Fund, or to any shareholder for any loss suffered by the Trust or the Fund which arises out of any

action or inaction of such Covered Person if such Covered Person, in good faith, determined that such course of conduct was in the best

interest of the Trust or the Fund and such course of conduct did not constitute gross negligence or willful misconduct of such Covered

Subject to the foregoing, neither the Sponsor nor any other Covered Person shall be personally liable for the return or repayment

of all or any portion of the capital or profits of any shareholder or assignee thereof, it being expressly agreed that any such return

of capital or profits made pursuant to the Trust Agreement shall be made solely from the assets of the Fund without any rights of contribution

from the Sponsor or any other Covered Person.

A Covered Person shall not be liable for the conduct or willful misconduct of any administrator

or other delegate selected by the Sponsor with reasonable care, provided, however, that the Trustee and its affiliates shall not, under

any circumstances be liable for the conduct or willful misconduct of any administrator or other delegate or any other person selected

by the Sponsor to provide services to the Trust.

Trust Agreement also provides that the Sponsor shall be indemnified by the Trust (or by a series separately to the extent the matter

in question relates to a single series or disproportionately affects a specific series in relation to other series) against any losses,

judgments, liabilities, expenses (excluding any taxes on the compensation received for services as Sponsor or on indemnity payments received),

and amounts paid in settlement of any claims sustained by it in connection with its activities for the Trust, provided that (i) the Sponsor

was acting on behalf of or performing services for the Trust and has determined, in good faith, that such course of conduct was in the

best interests of the Trust and such liability or loss was not the result of gross negligence, willful misconduct, or a breach of the

Trust Agreement on the part of the Sponsor and (ii) any such indemnification will only be recoverable from the assets of the applicable

The Sponsor’s rights to indemnification permitted under the Trust Agreement shall not be affected by the dissolution or

other cessation to exist of the Sponsor, or the withdrawal, adjudication of bankruptcy or insolvency of the Sponsor, or the filing of

a voluntary or involuntary petition in bankruptcy under Title 11 of the Bankruptcy Code by or against the Sponsor.

Notwithstanding

the above, the Sponsor shall not be indemnified for any losses, liabilities or expenses arising from or out of an alleged violation

federal or state securities laws unless (i) there has been a successful adjudication on the merits of each count involving

alleged securities law violations as to the particular indemnitee and the court approves the indemnification of such expenses

(including, without limitation, litigation costs), (ii) such claims have been dismissed with prejudice on the merits by a court

of competent jurisdiction as to the particular indemnitee and the court approves the indemnification of such expenses (including,

without limitation, litigation costs), or (iii) a court of competent jurisdiction approves a settlement of the claims against

a particular indemnitee and finds that indemnification of the settlement and related costs should be made.

the above, the Sponsor shall not be indemnified for any losses, liabilities or expenses arising from or out of an alleged violation of

federal or state securities laws unless (i) there has been a successful adjudication on the merits of each count involving alleged

securities law violations as to the particular indemnitee and the court approves the indemnification of such expenses (including, without

limitation, litigation costs), (ii) such claims have been dismissed with prejudice on the merits by a court of competent jurisdiction

as to the particular indemnitee and the court approves the indemnification of such expenses (including, without limitation, litigation

costs), or (iii) a court of competent jurisdiction approves a settlement of the claims against a particular indemnitee and finds that

indemnification of the settlement and related costs should be made.

payment of any indemnification shall be allocated, as appropriate, among the Trust’s series.

The Trust and its series shall

not incur the cost of that portion of any insurance which insures any party against any liability, the indemnification of which

is prohibited under the Trust Agreement.

incurred in defending a threatened or pending action, suit or proceeding against the Sponsor shall be paid by the Trust in advance

of the final disposition of such action, suit or proceeding, if (i) the legal action relates to the performance of duties or services

by the Sponsor on behalf of the Trust;

The Trust and its series shall not

incur the cost of that portion of any insurance which insures any party against any liability, the indemnification of which is prohibited

under the Trust Agreement.

incurred in defending a threatened or pending action, suit or proceeding against the Sponsor shall be paid by the Trust in advance of

the final disposition of such action, suit or proceeding, if (i) the legal action relates to the performance of duties or services by

the Sponsor on behalf of the Trust;

(ii) the legal action is initiated by a party other than the Trust;

and (iii) the Sponsor

undertakes to repay the advanced funds with interest to the Trust in cases in which it is not entitled to indemnification.

and (iii) the Sponsor undertakes

to repay the advanced funds with interest to the Trust in cases in which it is not entitled to indemnification.

Trust Agreement provides that the Sponsor and the Trust shall indemnify the Trustee and its successors, assigns, legal representatives,

officers, directors, Shareholders, employees, agents and servants (the “Trustee Indemnified Parties”) against any

liabilities, obligations, losses, damages, penalties, taxes (excluding any taxes on the compensation received for services as

Trustee or on indemnity payments received), claims, actions, suits, costs, expenses or disbursements which may be imposed on a

Trustee Indemnified Party relating to or arising out of the formation, operation or termination of the Trust, the execution, delivery

and performance of any other agreements to which the Trust is a party, or the action or inaction of the Trustee under the Trust

Agreement or any other agreement, except for expenses resulting from the gross negligence or willful misconduct of a Trustee Indemnified

Further, certain officers of the Sponsor are insured against liability for certain errors or omissions which an officer

may incur or that may arise out of his or her capacity as such.

the event the Trust is made a party to any claim, dispute, demand or litigation or otherwise incurs any liability or expense as

a result of or in connection with any Shareholder’s (or assignee’s) obligations or liabilities unrelated to the Trust

business, such Shareholder (or assignees cumulatively) is required under the Trust Agreement to indemnify the Trust for all such

liability and expense incurred, including attorneys’ and accountants’ fees.

officers, directors, shareholders, employees, agents and servants (the “Trustee Indemnified Parties”) against any liabilities,

obligations, losses, damages, penalties, taxes (excluding any taxes on the compensation received for services as Trustee or on indemnity

payments received), claims, actions, suits, costs, expenses or disbursements which may be imposed on a Trustee Indemnified Party relating

to or arising out of the formation, operation or termination of the Trust, the execution, delivery and performance of any other agreements

to which the Trust is a party, or the action or inaction of the Trustee under the Trust Agreement or any other agreement, except for

expenses resulting from the gross negligence or willful misconduct of a Trustee Indemnified Party.

Further, certain officers of the Sponsor

are insured against liability for certain errors or omissions which an officer may incur or that may arise out of his or her capacity

the event the Trust is made a party to any claim, dispute, demand or litigation or otherwise incurs any liability or expense as a result

of or in connection with any shareholder’s (or assignee’s) obligations or liabilities unrelated to the Trust business, such

shareholder (or assignees cumulatively) is required under the Trust Agreement to indemnify the Trust for all such liability and expense

incurred, including attorneys’ and accountants’ fees.

of the Sponsor

Sponsor may withdraw voluntarily as the Sponsor of the Trust only upon ninety (90) days’ prior written notice to the holders

of the Trust’s outstanding Shares and the Trustee.

If the withdrawing Sponsor is the last remaining Sponsor, Shareholders

holding a majority (over 50%) of the outstanding Shares of the Fund, voting together as a single class (not including Shares acquired

by the Sponsor through its initial capital contribution) may vote to elect a successor Sponsor.

The successor Sponsor will continue

the business of the Trust.

Shareholders have no right to remove the Sponsor.

the event of withdrawal, the Sponsor is entitled to a redemption of the Shares it acquired through its initial capital contribution

to any of the series of the Trust at their NAV per Share.

If the Sponsor withdraws and a successor Sponsor is named, the withdrawing

Sponsor shall pay all expenses as a result of its withdrawal.

of the Trust’s Shareholders may be called by the Sponsor and will be called by it upon the written request of Shareholders

holding at least 25% of the outstanding Shares of the Trust or the Fund, as applicable (not including Shares acquired by the Sponsor

through its initial capital contribution).

The Sponsor shall deposit in the United States mail or electronically transmit written

notice to all Shareholders of the Fund of the meeting and the purpose of the meeting, which shall be held on a date not less than

30 nor more than 60 days after the date of mailing of such notice, at a reasonable time and place.

Where the meeting is called

upon the written request of the Shareholders of the Fund, or any other Fund, as applicable, such written notice shall be mailed

or transmitted not more than 45 days after such written request for a meeting was received by the Sponsor.

Sponsor may withdraw voluntarily as the sponsor of the Trust only upon thirty (30) days’ prior written notice to the holders of

the Trust’s outstanding Shares and the Trustee.

The Sponsor may appoint a successor sponsor to carry on the business of the Trust.

In addition, if the withdrawing Sponsor is the last remaining sponsor, shareholders holding a majority (over 50%) of the outstanding

Shares of the Fund, voting together as a single class (not including Shares acquired by the Sponsor through its initial capital contribution)

may vote to elect a successor sponsor.

The successor sponsor will continue the business of the Trust.

Shareholders have no right to remove

the event of withdrawal, the Sponsor is entitled to a redemption of the Shares it acquired through its initial capital contribution to

any of the series of the Trust at their NAV per Share.

If the Sponsor withdraws and a successor sponsor is named, the withdrawing Sponsor

shall pay all expenses as a result of its withdrawal.

of the Trust’s shareholders may be called by the Sponsor and will be called by it upon the written request of shareholders holding

at least 25% of the outstanding Shares of the Trust or the Fund, as applicable (not including Shares acquired by the Sponsor through

its initial capital contribution).

The Sponsor shall deposit in the United States mail or electronically transmit written notice to all

shareholders of the Fund of the meeting and the purpose of the meeting, which shall be held on a date not less than 30 nor more than

60 days after the date of mailing of such notice, at a reasonable time and place.

Where the meeting is called upon the written request

of the shareholders of the Fund, or any other Fund, as applicable, such written notice shall be mailed or transmitted not more than 45

days after such written request for a meeting was received by the Sponsor.

have no voting rights with respect to the Trust or the Fund except as expressly provided in the Trust Agreement.

The Trust Agreement

provides that Shareholders representing at least a majority (over 50%) of the outstanding Shares of the Fund together as a single

class (excluding Shares acquired by the Sponsor in connection with its initial capital contribution to any Trust series) may vote

to (i) continue the Trust by electing a successor Sponsor as described above, and (ii) approve amendments to the Trust Agreement

that impair the right to surrender Redemption Baskets for redemption.

(Trustee consent to any amendment to the Trust Agreement

is required if the Trustee reasonably believes that such amendment adversely affects any of its rights, duties or liabilities.)

In addition, Shareholders holding Shares representing seventy-five percent (75%) of the outstanding Shares of the Fund, voting

together as a single class (excluding Shares acquired by the Sponsor in connection with its initial capital contribution to any

Trust series) may vote to dissolve the Trust upon not less than ninety (90) days’ notice to the Sponsor.

provides that shareholders representing at least a majority (over 50%) of the outstanding Shares of the Fund together as a single class

(excluding Shares acquired by the Sponsor in connection with its initial capital contribution to any Trust series) may vote to (i) continue

the Trust by electing a successor Sponsor as described above, and (ii) approve amendments to the Trust Agreement that impair the right

to surrender Baskets for redemption.

(Trustee consent to any amendment to the Trust Agreement is required if the Trustee reasonably believes

that such amendment adversely affects any of its rights, duties or liabilities.) In addition, shareholders holding Shares representing

seventy-five percent (75%) of the outstanding Shares of the Fund, voting together as a single class (excluding Shares acquired by the

Sponsor in connection with its initial capital contribution to any Trust series) may vote to dissolve the Trust upon not less than ninety

(90) days’ notice to the Sponsor.

Liability of Shareholders

shall be entitled to the same limitation of personal liability extended to stockholders of private corporations for profit organized

under the general corporation law of Delaware, and no Shareholder shall be liable for claims against, or debts of the Trust or

the Fund in excess of his Share of the Fund’s assets.

The Trust or the Fund shall not make a claim against a Shareholder

with respect to amounts distributed to such Shareholder or amounts received by such Shareholder upon redemption unless, under

Delaware law, such Shareholder is liable to repay such amount.

Trust or the Fund shall indemnify to the full extent permitted by law and the Trust Agreement each Shareholder (excluding the

Sponsor to the extent of its ownership of any Shares acquired through its initial capital contribution) against any claims of

liability asserted against such Shareholder solely because of its ownership of Shares (other than for taxes on income from Shares

for which such Shareholder is liable).

Trust Agreement provides that every written note, bond, contract, instrument, certificate or undertaking made or issued by or

on behalf of the Fund shall give notice to the effect that the obligations of such instrument are not binding upon the Shareholders

individually but are binding only upon the assets and property of the Fund.

under the general corporation law of Delaware, and no shareholder shall be liable for claims against, or debts of the Trust or the Fund

in excess of his Share of the Fund’s assets.

The Trust or the Fund shall not make a claim against a shareholder with respect to

amounts distributed to such shareholder or amounts received by such shareholder upon redemption unless, under Delaware law, such shareholder

is liable to repay such amount.

Trust or the Fund shall indemnify to the full extent permitted by law and the Trust Agreement each Shareholder (excluding the Sponsor

to the extent of its ownership of any Shares acquired through its initial capital contribution) against any claims of liability asserted

against such shareholder solely because of its ownership of Shares (other than for taxes on income from Shares for which such shareholder

Trust Agreement provides that every written note, bond, contract, instrument, certificate or undertaking made or issued by or on behalf

of the Fund shall give notice to the effect that the obligations of such instrument are not binding upon the shareholders individually

but are binding only upon the assets and property of the Fund.

Sponsor Has Conflicts of Interest

are present and potential future conflicts of interest in the Trust’s structure and operation you should consider before

you purchase Shares.

The Sponsor may use this notice of conflicts as a defense against any claim or other proceeding made.

are present and potential future conflicts of interest in the Trust’s structure and operation you should consider before you purchase

Prospective investors should be aware that the Sponsor and the Trustee intend to assert that shareholders have, by purchasing

Shares, consented to the following conflicts of interest in the event of any proceeding alleging that such conflicts violated any duty

owed by the Sponsor to the shareholders.

The Sponsor may use this notice of conflicts as a defense against any claim or other proceeding

Sponsor’s principals, managers, officers and employees, do not devote their time exclusively to the Fund.

Notwithstanding

obligations and expectations related to the management of the Sponsor, the Sponsor’s principals, officers, and employees

may be trustees, directors, officers or employees of other entities, and may manage assets of other entities, including the other

funds of the Trust, through the Sponsor or otherwise.

As a result, the Sponsor’s principals, managers, officers, and employees

could have a conflict between responsibilities to the Fund on the one hand and to those other entities on the other hand.

Sponsor and its principals, officers, and employees may trade securities, futures and related contracts for their own accounts,

creating the potential for preferential treatment of their own accounts.

Shareholders will not be permitted to inspect the trading

records of such persons, or any written policies of the Sponsor related to such trading.

A conflict of interest may exist if their

trades are in the same markets and at approximately the same times as the trades for the Fund.

A potential conflict also may occur

when the Sponsor’s principals, managers, officers, or employees trade their accounts more aggressively or take positions

in their accounts that are opposite, or ahead of, the positions taken by the Fund.

Sponsor has sole current authority to manage the investments and operations of the Fund, and this may allow it to act in a way

that furthers its own interests which may create a conflict with Fund shareholders’ best interests, including the authority

of the Sponsor to allocate expenses to and between the funds of the Trust.

Shareholders have very limited voting rights with respect

to the Fund, which will limit the ability to influence matters such as amendment of the Trust Agreement, change in the Fund’s

basic investment policies, or dissolution of the Fund or the Trust.

Sponsor serves as the Sponsor to the Fund and serves as the sponsor, or investment adviser, or investment sub- adviser, to investment

companies and commodity pools other than the Fund.

The Sponsor may have a conflict to the extent that its trading decisions for

the Fund may be influenced by the effect they would have on the other investment companies or pools it manages.

In addition, the

Sponsor may be required to indemnify the officers, trustees, and directors of the other investment companies or pools, if the

need for indemnification arises.

This potential indemnification will cause the Sponsor’s assets to decrease.

If the Sponsor’s

other sources of income are not sufficient to compensate for the indemnification, it could cease operations, which could in turn

result in Fund losses and/or termination of the Fund.

the Sponsor acquires knowledge of a potential transaction or arrangement that may be an opportunity for the Fund, it shall have

no duty to offer such opportunity to the Fund.

The Sponsor will not be liable to the Fund or the Shareholders for breach of any

fiduciary or other duty if the Sponsor pursues such opportunity or directs it to another person or does not communicate such opportunity

to the Fund and is not required to share income or profits derived from such business ventures with the Fund.

Sponsor might have a potential future conflict of interest if the Sponsor, a new sponsor, or sub-adviser were to register as a

broker-dealer or become affiliated with a broker-dealer.

In such case, the Sponsor, new sponsor, or sub- adviser, as the case

may be, would develop and implement appropriate procedures designed to prevent the use and dissemination of material non-public

information regarding the Fund’s holdings.

Notwithstanding obligations

and expectations related to the management of the Sponsor, the Sponsor’s principals, officers and employees may be directors, officers

or employees of other entities, and may manage assets of other entities, including the other funds of the Trust, through the Sponsor

or otherwise.

As a result, the principals could have a conflict between responsibilities to the Fund on the one hand and to those other

entities on the other.

Sponsor and its principals, officers, and employees may trade securities, futures and related contracts for their own accounts, creating

the potential for preferential treatment of their own accounts.

Shareholders will not be permitted to inspect the trading records of

such persons, or any written policies of the Sponsor related to such trading.

A conflict of interest may exist if their trades are in

the same markets and at approximately the same times as the trades for the Fund.

A potential conflict also may occur when the Sponsor’s

principals, managers, officers, or employees trade their accounts more aggressively or take positions in their accounts that are opposite,

or ahead of, the positions taken by the Fund.

Sponsor has sole current authority to manage the investments and operations of the Fund, and this may allow it to act in a way that furthers

its own interests which may create a conflict with Fund shareholders’ best interests, including the authority of the Sponsor to

allocate expenses to and between the funds of the Trust.

Shareholders have very limited voting rights with respect to the Fund, which

will limit the ability to influence matters such as amendment of the Trust Agreement, change in the Fund’s basic investment policies,

or dissolution of the Fund or the Trust.

Sponsor serves as the Sponsor to the Fund and serves as the sponsor, investment manager or investment adviser to investment vehicles

other than the Fund.

The Sponsor may have a conflict to the extent that its trading decisions for the Fund may be influenced by the effect

they would have on the other investment companies or pools it manages.

In addition, the Sponsor may be required to indemnify the officers

and directors of the other investment vehicles, if the need for indemnification arises.

This potential indemnification will cause the

Sponsor’s assets to decrease.

If the Sponsor’s other sources of income are not sufficient to compensate for the indemnification,

it could cease operations, which could in turn result in Fund losses and/or termination of the Fund.

the Sponsor acquires knowledge of a potential transaction or arrangement that may be an opportunity for the Fund, it shall have no duty

to offer such opportunity to the Fund.

The Sponsor will not be liable to the Fund or the shareholders for breach of any fiduciary or

other duty if the Sponsor pursues such opportunity or directs it to another person or does not communicate such opportunity to the Fund

and is not required to share income or profits derived from such business ventures with the Fund.

Sponsor and its employees and affiliates may participate in transactions related to bitcoin, either for their own account (subject to

certain internal employee trading operating practices) or for the account of others, such as clients, and such transactions may occur

prior to, during, or after the commencement of this offering.

Such transactions may not serve to benefit the shareholders of the Fund

and may have a positive or negative effect on the value of the bitcoin held by the Fund and, consequently, on the market value of bitcoin.

Because these parties may trade bitcoin for their own accounts at the same time as the Fund, prospective shareholders should be aware

that such persons may take positions in bitcoin which are opposite, or ahead of, the positions taken for the Fund.

There can be no assurance

that any of the foregoing will not have an adverse effect on the performance of the Trust.

Sponsor has adopted and implemented policies and procedures that are reasonably designed to ensure compliance with applicable law, including

a Code of Ethics providing guidance on conflicts of interest (collectively, the “Policies”).

As of December 31, 2025, the

Sponsor’s Policies are in place and require that the Sponsor eliminate, mitigate, or otherwise disclose conflicts of interest.

Additionally, the Sponsor has adopted policies and procedures requiring that certain applicable personnel pre-clear personal trading

activity in which bitcoin is the referenced asset.

The Sponsor has also implemented an Information Barrier Policy restricting certain

applicable personnel from obtaining sensitive information.

The Sponsor believes that these structured controls are reasonably designed

to mitigate the risk of conflicts of interest and other impermissible activity.

Sponsor might have a potential future conflict of interest if the Sponsor, a new sponsor, or sub-adviser were to register as a broker-dealer

or become affiliated with a broker-dealer.

In such case, the Sponsor, new sponsor, or sub-adviser, as the case may be, would develop

and implement appropriate procedures designed to prevent the use and dissemination of material non-public information regarding the Fund’s

of Conflicts Procedures

Trust Agreement provides that whenever a conflict of interest exists between the Sponsor or any of its Affiliates, on the one

hand, and the Trust, any shareholder of a Trust series, or any other person, on the other hand, the Sponsor shall resolve such

conflict of interest, take such action or provide such terms, considering in each case the relative interest of each party (including

its own interest) to such conflict, agreement, transaction or situation and the benefits and burdens relating to such interests,

any customary or accepted industry practices, and any applicable generally accepted accounting practices or principles.

absence of bad faith by the Sponsor, the resolution, action or terms so made, taken or provided by the Sponsor shall not constitute

a breach of the Trust Agreement or any other agreement contemplated therein or of any duty or obligation of the Sponsor at law

or in equity or otherwise.

or Beneficial Interest in the Fund

of the date of this report, the Sponsor owns 507 Shares of the Fund and none of the principals of the Sponsor have an ownership

interest in the Fund.

of Named Experts and Counsel

expert hired by the Fund to give advice on the preparation of this Form 10-K has been hired on a contingent fee basis, nor do

any of them have any present or future expectation of interest in the Sponsor, Marketing Agent, Authorized Purchasers, Custodian/Administrator

or other service providers to the Fund.

of Federal and State Securities Laws

SEC and state securities agencies take the position that indemnification of the Sponsor that arises out of an alleged violation

of such laws is prohibited unless certain conditions are met.

Those conditions require that no indemnification of the Sponsor

or any underwriter for the Fund may be made in respect of any losses, liabilities or expenses arising from or out of an alleged

violation of federal or state securities laws unless:

(i) there has been a successful adjudication on the merits of each count

involving alleged securities law violations as to the party seeking indemnification and the court approves the indemnification;

(ii) such claim has been dismissed with prejudice on the merits by a court of competent jurisdiction as to the party seeking indemnification;

or (iii) a court of competent jurisdiction approves a settlement of the claims against the party seeking indemnification and finds

that indemnification of the settlement and related costs should be made, provided that, before seeking such approval, the Sponsor

or other indemnitee must apprise the court of the position held by regulatory agencies against such indemnification.

Market Regulation

regulation of futures markets, futures contracts, and futures exchanges has historically been comprehensive.

The CFTC and the

exchanges are authorized to take extraordinary actions in the event of a market emergency including, for example, the retroactive

implementation of speculative position limits, increased margin requirements, the establishment of daily price limits and the

suspension of trading on an exchange or trading facility.

to authority in the CEA, the NFA has been formed and registered with the CFTC as a registered futures association.

At the present

time, the NFA is the only SRO for commodity interest professionals, other than futures exchanges.

The CFTC has delegated to the

NFA responsibility for the registration of CPOs and FCMs and their respective associated persons.

The Sponsor and the Fund’s

clearing broker are members of the NFA.

As such, they will be subject to NFA standards relating to fair trade practices, financial

condition and consumer protection.

The NFA also arbitrates disputes between members and their customers and conducts registration

and fitness screening of applicants for membership and audits of its existing members.

Neither the Trust nor the Fund is required

to become a member of the NFA.

The regulation of commodity interest transactions in the United States is a rapidly changing area

of law and is subject to ongoing modification by governmental and judicial action.

Considerable regulatory attention has been

focused on non-traditional investment pools that are publicly distributed in the United States.

There is a possibility of future

regulatory changes within the United States altering, perhaps to a material extent, the nature of an investment in the Fund, or

the ability of the Fund to continue to implement its investment strategy.

In addition, various national governments outside of

the United States have expressed concern regarding the disruptive effects of speculative trading in the commodities markets and

the need to regulate the derivatives markets in general.

The effect of any future regulatory change on the Fund is impossible

to predict but could be substantial and adverse.

CFTC possesses exclusive jurisdiction to regulate the activities of commodity pool operators and commodity trading advisors

with respect to “commodity interests,” such as futures, swaps, and options, and has adopted regulations with

respect to the activities of those persons and/or entities.

Under the Commodity Exchange Act (“CEA”), a

registered commodity pool operator, such as the Sponsor, is required to make annual filings with the CFTC and the NFA

describing its organization, capital structure, management and controlling persons.

In addition, the CEA authorizes the CFTC

to require and review books and records of, and documents prepared by, registered commodity pool operators.

Pursuant to this

authority, the CFTC requires commodity pool operators to keep accurate, current and orderly records for each pool that they

The CFTC may suspend the registration of a commodity pool operator (1) if the CFTC finds that the operator’s

trading practices tend to disrupt orderly market conditions, (2) if any controlling person of the operator is subject to an

order of the CFTC denying such person trading privileges on any exchange, and (3) in certain other circumstances.

restriction or termination of the Sponsor’s registration as a commodity pool operator would prevent it, until that

registration were to be reinstated, from managing the Fund, and might result in the termination of the Fund if a successor

sponsor is not elected pursuant to the Trust Agreement.

Neither the Trust nor the Fund is required to be registered with the

CFTC in any capacity.

Fund’s investors are afforded prescribed rights for reparations under the CEA.

Investors may also be able to maintain a

private right of action for violations of the CEA.

The CFTC has adopted rules implementing the reparation provisions of the CEA,

which provide that any person may file a complaint for a reparations award with the CFTC for violation of the CEA against a floor

broker or an FCM, introducing broker, commodity trading advisor, CPO, and their respective associated persons.

regulations of the CFTC and the NFA prohibit any representation by a person registered with the CFTC or by any member of the NFA,

that registration with the CFTC, or membership in the NFA, in any respect indicates that the CFTC or the NFA has approved or endorsed

that person or that person’s trading program or objectives.

The registrations and memberships of the parties described in

this summary must not be considered as constituting any such approval or endorsement.

Likewise, no futures exchange has given

or will give any similar approval or endorsement.

venues in the United States are subject to varying degrees of regulation under the CEA depending on whether such exchange is a

designated contract market (i.e.

a futures exchange) or a swap execution facility.

Clearing organizations are also subject to

the CEA and the rules and regulations adopted thereunder as administered by the CFTC.

The CFTC’s function is to implement

the CEA’s objectives of preventing price manipulation and excessive speculation and promoting orderly and efficient commodity

interest markets.

In addition, the various exchanges and clearing organizations themselves as SROs exercise regulatory and supervisory

authority over their member firms.

Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) was enacted in response to the economic

crisis of 2008 and 2009 and it significantly altered the regulatory regime to which the securities and commodities markets are

To date, the CFTC has issued proposed or final versions of almost all of the rules it is required to promulgate under

the Dodd-Frank Act, and it continues to issue proposed versions of additional rules that it has authority to promulgate.

of the new law include the requirement that position limits be established on a wide range of commodity interests, including agricultural,

energy, and metal-based commodity futures contracts, options on such futures contracts and uncleared swaps that are economically

equivalent to such futures contracts and options (“Reference Contracts”);

new registration and recordkeeping requirements

for swap market purchasers;

capital and margin requirements for “swap dealers” and “major swap,” as determined

by the new law and applicable regulations;

reporting of all swap transactions to swap data repositories;

and the mandatory use

of clearinghouse mechanisms for sufficiently standardized swap transactions that were historically entered into in the OTC market,

but are now designated as subject to the clearing requirement;

and margin requirements for OTC swaps that are not subject to the

clearing requirements.

addition, considerable regulatory attention has recently been focused on non-traditional publicly distributed investment pools

such as the Fund.

Furthermore, various national governments have expressed concern regarding the disruptive effects of speculative

trading in certain commodity markets and the need to regulate the derivatives markets in general.

The effect of any future regulatory

change on the Funds is impossible to predict but could be substantial and adverse.

Dodd-Frank Act was intended to reduce systemic risks that may have contributed to the 2008/2009 financial crisis.

Since the first

draft of what became the Dodd-Frank Act, supporters and opponents have debated the scope of the legislation.

As the Administrations

change, the interpretation and implementation will change along with them.

Nevertheless, regulatory reform of any

kind may have a significant impact on U.S.

regulated entities.

Market Transactions

markets, on the other hand, are largely unregulated and rely on pricing sources that track over-the-counter (OTC) transactions.

For cryptoassets, including bitcoin, these OTC transactions are relatively new and usually take place in the so-called crypto

asset exchanges are relatively new and, in some cases, unregulated.

Furthermore, while many prominent digital asset exchanges

provide the public with significant information regarding their ownership structure, management teams, corporate practices and

regulatory compliance, many digital asset exchanges do not provide this information.

Digital asset exchanges do not appear to

be subject to, or may not comply with, regulation in a similar manner as other regulated trading platforms, such as national securities

exchanges or designated contract markets.

These markets are local, national and international and include a broadening range of

digital assets and participants.

Significant trading may occur on systems and platforms with minimum predictability.

many spot markets and over-the- counter market venues do not provide the public with significant information regarding their ownership

structure, management teams, corporate practices or oversight of customer trading.

As a result, the marketplace may lose confidence

in digital asset exchanges, including prominent exchanges that handle a significant volume of bitcoin trading.

digital asset exchanges are unlicensed, unregulated, operate without extensive supervision by governmental authorities, and do

not provide the public with significant information regarding their ownership structure, management team, corporate practices,

cybersecurity, and regulatory compliance.

In particular, those located outside the United States may be subject to significantly

less stringent regulatory and compliance requirements in their local jurisdictions.

As a result, trading activity on or reported

by these digital asset exchanges is generally significantly less regulated than trading in regulated U.S.

securities and commodities

markets, and may reflect behavior that would be prohibited in regulated U.S.

trading venues

a means to mitigate these risks, the proposed Fund intends to achieve spot market exposure by trading futures contracts in the

This is possible through what is called Exchange for Physical transactions, or simply “EFP”.

a species of the gender “Exchange for Related Positions”, or EFRPs, alongside with Exchange of Futures for Risk (EFR)

and Exchange of Option for Option (EOO).

EFPs are a type of private agreement between two parties to trade a futures position

for the underlying asset.

In the context of the Fund, these transactions will be used to purchase and sell spot bitcoin by delivering

or receiving the equivalent futures position.

In an EFP transaction, two parties exchange equivalent but offsetting positions

in a Bitcoin futures contract and the underlying physical Bitcoin.

One party is the buyer of futures and the seller of the physical

Bitcoin, and the other party takes the opposite position (seller of futures and buyer of physical).

The EFP is a privately-negotiated

transaction between the two parties to the trade, where the consummated transaction must be reported to CME and its conditions

and prices are subject to oversight from CME’s Market Regulation.

Because both sides of the trade track the same benchmark

(Bitcoin), an EFP is market-neutral.

As such, the pricing of the EFP is quoted in terms of the basis between the price of the

futures contract and the level of the underlying Bitcoin.

The EFP transactions, although facilitated by the infrastructure and

under the regulatory oversight of the CME, a CFTC-regulated market, are executed off-exchange and may not carry the same regulatory

requirements and level of oversight as on-exchange transactions.

transactions are governed by CME’s Rule No.

538 1 and defined as “the simultaneous

execution of an Exchange [CME] futures contract and a corresponding physical transaction or a forward contract on a physical transaction.”.

Moreover, all parties to an EFP transaction are required to maintain all records relevant to the transaction pursuant to CFTC

Regulation 1.35, thus providing the ability for CME and the CFTC to conduct surveillance inquiries and investigations in an efficient

and effective manner for the protection of customers and ensuring market integrity and adding another layer of regulatory scrutiny

over the transaction.

Furthermore, each clearing member, omnibus account and foreign broker responsible for submitting daily large

trader positions must submit for each reportable account the EFP volume bought and sold in the reportable instrument.

This information

must be included in the daily large trader report to the CME, providing more transparency to the market.

It is important to highlight

that in its Rule Enforcement Review of the CME, the CFTC included detailed measures for surveillance and monitoring of EFPs.

Fund is a commodity pool and the Sponsor is a commodity pool operator subject to regulation by the CTFC and the NFA under the

Commodity Exchange Act (“CEA”).

The collapse of TerraUSD and the bankruptcy filings of FTX, Celsius, Voyager and BlockFi

have resulted in calls for heightened scrutiny and regulation of the digital asset industry, with a specific focus on digital

asset trading platforms, and custodians.

Federal and state legislatures and regulatory agencies are expected to introduce and

enact new laws and regulations to regulate digital asset intermediaries, such as digital asset trading platforms and custodians.

regulatory regime-namely the Federal Reserve Board, U.S.

Congress and certain U.S.

agencies (e.g., the SEC, the CFTC,

FinCEN, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation and the Federal Bureau of Investigation)

as well as the White House have issued reports and releases concerning digital assets, including bitcoin and digital asset markets.

extent and content of any forthcoming laws and regulations are not yet ascertainable with certainty, and it may not be ascertainable

in the near future.

It is possible that new laws and increased regulation and regulatory scrutiny may require the Fund to comply

with certain regulatory regimes, which could result in new costs for the Fund.

For example, FINRA issued a notice on March 8,

2022 seeking comment on measures that could prevent or restrict investors from buying a broad range of public securities and products

designated as “complex products” - which could include each Exchange Traded Product offered by the Sponsor.

impact, if any, of these measures remain unclear.

However, if regulations are adopted, they could, among other things, prevent

or restrict investors’ ability to buy the Fund.

The Fund may have to devote increased time and attention to regulatory matters,

which could increase costs to the Fund.

New laws, regulations and regulatory actions could significantly restrict or eliminate

the market for, or uses of, digital assets including bitcoin, which could have a negative effect on the value of bitcoin, which

in turn would have a negative effect on the value of the Shares.

a conflict of interest exists between the Sponsor or any of its affiliates, on the one hand, and the Trust, any shareholder of a Trust

series, or any other person, on the other hand, the Sponsor shall resolve such conflict of interest, take such action or provide such

terms, considering in each case the relative interest of each party (including its own interest) to such conflict, agreement, transaction

or situation and the benefits and burdens relating to such interests, any customary or accepted industry practices, and any applicable

generally accepted accounting practices or principles.

In the absence of bad faith by the Sponsor, the resolution, action or terms so

made, taken or provided by the Sponsor shall not constitute a breach of the Trust Agreement or any other agreement contemplated therein

or of any duty or obligation of the Sponsor at law or in equity or otherwise.

Trust does not have any employees.

Trust and the Sponsor face competition with respect to the creation of competing commodity pools and related bitcoin products.

There can be no assurance that the Trust will achieve initial market acceptance and scale due to competition.

Trust keeps its books of record and account at its office located at 234 West Florida Street, Suite 203, Milwaukee, Wisconsin

53204, or at the offices of the Sub-Administrator, Global Fund Services, doing business as U.S.

Bancorp Fund Services, LLC, doing

business as U.S.

Bank Global Fund Services, located at 777 E.

Wisconsin Ave, Milwaukee, Wisconsin 53202, or such office, including

can be no assurance that the Trust will achieve initial market acceptance and scale due to competition.

Trust keeps its books of record and account at the office of the Sponsor or at the offices of the Administrator, or such office, including

of an administrative agent, as it may subsequently designate upon notice.

books of account of the Fund are open to inspection by any Shareholder (or any duly constituted designee of a Shareholder) at

all times during the usual business hours of the Fund upon reasonable advance notice to the extent such access is required under

CFTC rules and regulations.

In addition, the Trust keeps a copy of the Trust Agreement on file in its office which will be available

for inspection by any Shareholder at all times during its usual business hours upon reasonable advance notice.

https://www.cmegroup.com/rulebook/files/cme-group-Rule-538.pdf

Filings, and Reports to Shareholders

Fund’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, including exhibits, and

amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 are available

free of charge on the Fund’s website as soon as reasonably practicable after we electronically file such material with,

or furnish it to, the SEC.

The Fund’s website and the information contained therein or connected thereto are not intended

to be incorporated into this Annual Report on Form 10-K.

The Trust will furnish annual reports (as of the end of each fiscal year)

for the Fund to DTC purchasers for distribution to Shareholders, as required to be provided to Shareholders by the CFTC and the

These annual reports will contain financial statements prepared by the Sponsor and audited by an independent registered public

accounting firm designated by the Sponsor.

The Trust will also post monthly reports to the Fund’s website.

These monthly

reports will contain certain unaudited financial information regarding the Fund, including the Fund’s NAV.

The Sponsor will

furnish to the Shareholders other reports or information which the Sponsor, in its discretion, determines to be necessary or appropriate.

The Trust will post the same information that would otherwise be provided in the Trust’s CFTC, NFA and SEC reports on the

Fund’s website:

http://hashdex-etfs.com /.

accountants’ report on its audit of the Fund’s financial statements will be furnished by the Trust to Shareholders

upon request.

The Trust will file such tax returns, and prepare, disseminate and file such tax reports for the Fund as it is advised

by its counsel or accountants are from time to time required by any applicable statute, rule or regulation and will make such

tax elections for the Fund as it deems advisable.

Fund or its appointed agent will provide tax information in accordance with the Code and applicable U.S.

Treasury Regulations.

Persons treated as intermediaries for purposes of these regulations may obtain tax information regarding the Fund by contacting

the Fund at 234 West Florida Street, Suite 203, Milwaukee, Wisconsin 53204 or from the Fund’s website.

The books and records are open to inspection by any person

who establishes to the Trust’s satisfaction that such person is a shareholder upon reasonable advance notice at all reasonable

times during usual business hours of the Trust.

The Trust keeps a copy of the Trust Agreement on file in the Sponsor’s office which

will be available for inspection by any shareholder at all times during its usual business hours upon reasonable advance notice.

required for smaller reporting companies.

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