What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-08-06 compared with 2026-05-06 · 56 added, 35 removed, 97 unchanged (48% of the section changed)

17 unchanged sentences

The Trust is sponsored by FD Funds Management LLC (the “Sponsor”), a wholly owned subsidiary of FMR LLC.

The Trust is passively managed and does not pursue active management investment strategies, invest in derivatives, or loan or pledge its assets.

The Trust is passively managed and does not pursue active management investment strategies, utilize leverage, invest in derivatives, or loan or pledge its assets in seeking to meet its investment objective.

The Sponsor believes that the Shares are designed to provide investors with a cost-effective and convenient way to invest in bitcoin without purchasing, holding and trading bitcoin directly.

The Trust sells and redeems Shares only with Authorized Participants in exchange for bitcoin or cash and only in blocks of 25,000 Shares.

The Trust sells and redeems Shares only with Authorized Participants in exchange for bitcoin or cash and only in blocks of 25,000 Shares (a "Basket").

The Shareholders of the Trust take no part in the management or control, and have no voice in, the Trust’s operations or business.

16 unchanged sentences

In determining an alternative fair value method, the Valuation and Liquidity Committee generally considers such criteria as observable market-based inputs, including market quotations and last sale information from third-party pricing services and/or trading platforms on which bitcoin are traded.

The Valuation and Liquidity Committee’s selection of third-party pricing services used considers the qualifications, experience, and history of the pricing services and whether their valuation methodologies and procedures are reasonably designed to produce prices that reflect fair value under the prevailing market conditions.

The Valuation and Liquidity Committee’s selection of third-party pricing services used considers the qualifications, experience, and history of the pricing services and whether their valuation

methodologies and procedures are reasonably designed to produce prices that reflect fair value under the prevailing market conditions.

In addition, in order to provide updated information relating to the Trust for use by Shareholders and market professionals, a third-party financial data provider will calculate and disseminate throughout the core trading session on each trading day an updated intraday indicative value (“IIV”).

14 unchanged sentences

EST on the Trust’s financial statement measurement date.

The Quarter Ended March 31, 2026

The Trust’s net assets decreased from approximately $17.6 billion as of December 31, 2025 to $12.8 billion as of March 31, 2026.

The change in the Trust’s net assets primarily resulted from an decrease in outstanding Shares, which fell from 231,403,476 as of December 31, 2025 to 216,003,476 as of March 31, 2026.

This was as a result of 28,700,000 Shares (1,148 Baskets) being created and 44,100,000 Shares (1,764 Baskets) being redeemed during the three months ended March 31, 2026, coupled with an decrease in the price of bitcoin, which fell 22.10% from $87,463.03 as of December 31, 2025 to $68,129.64 as of March 31, 2026.

The NAV per Share decreased 22.15% from $76.21 as of December 31, 2025 to $59.33 as of March 31, 2026.

The Trust’s NAV per Share decreased 22.38% from $76.10 as of December 31, 2025, to $59.07 as of March 31, 2026.

The Trust ’s NAV per Share of $85.01 at January 14, 2026, was the highest during the three months ended March 31, 2026, compared with a low of $55.43 at February 5, 2026.

The quantity of bitcoin owned by the Trust and held by the bitcoin custodian decreased from 201,684 as of December 31, 2025 to 188,144 on March 31, 2026.

The decrease in quantity resulted from net redemptions of Shares during the quarter which corresponded to net sales of bitcoin.

The net decrease in net assets resulting from operations for the three months ended March 31, 2026, was $3.7 billion, primarily resulting from a net change in unrealized depreciation on investment in bitcoin of $3.8 billion and a net realized loss of $0.1 billion from the sale of the investment in bitcoin for the redemption of Shares, partially offset by a net realized gain of $0.2 billion from the distribution of the investment in bitcoin for the redemption of Shares.

The Quarter Ended March 31, 2025

The Trust’s net assets decreased from approximately $18.8 billion as of December 31, 2024 to $16.3 billion as of March 31, 2025.

The change in the Trust’s net assets resulted from a decrease in outstanding Shares, which fell from 230,678,476 as of December 31, 2024 to 225,528,476 as of March 31, 2025.

This was as a result of 31,600,000 Shares (1,264 Baskets) being created and 36,750,000 Shares (1,470 Baskets) being redeemed during the three months ended March 31, 2025, coupled with a decrease in the price of bitcoin, which fell 11.15% from $93,365.36 as of December 31, 2024 to $82,956.00 as of March 31, 2025.

The NAV per Share decreased 11.20% from $81.56 as of December 31, 2024 to $72.42 as of March 31, 2025.

The Trust’s NAV per Share decreased 11.54% from $81.80 as of December 31, 2024, to $72.36 as of March 31, 2025.

The Trust ’s NAV per Share of $92.97 at January 21, 2025, was the highest during the three months ended March 31, 2025, compared with a low of $68.74 at March 10, 2025.

The quantity of bitcoin owned by the Trust and held by the bitcoin custodian decreased from 201,556 as of December 31, 2024 to 196,933 on March 31, 2025.

The decrease in quantity resulted from net redemptions of Shares during the quarter which corresponded to net sales of bitcoin.

The net decrease in net assets resulting from operations for the three months ended March 31, 2025, was $2.2 billion, primarily resulting from a net change in unrealized depreciation on investment in bitcoin of $2.0 billion and a net realized loss of $0.2 billion from the sale of the investment in bitcoin for the redemption of Shares.

Results of Operations

The Quarter Ended June 30, 2026

The Trust’s net assets decreased from approximately $12.8 billion as of March 31, 2026 to $10.3 billion as of June 30, 2026.

The change in the Trust’s net assets primarily resulted from a decrease in outstanding Shares, which decreased from 216,003,476 as of March 31, 2026 to 200,328,476 as of June 30, 2026.

This was as a result of 20,750,000 Shares (830 Baskets) being created and 36,425,000 Shares (1,457 Baskets) being redeemed during the three months ended June 30, 2026, coupled with a decrease in the price of bitcoin, which decreased 13.25% from $68,129.64 as of March 31, 2026 to $59,101.49 as of June 30, 2026.

The NAV per Share decreased 13.30% from $59.33 as of March 31, 2026 to $51.44 as of June 30, 2026.

The Trust’s NAV per Share decreased 13.70% from $59.07 as of March 31, 2026, to $50.98 as of June 30, 2026.

The Trust ’s NAV per Share of $71.33 at May 11, 2026, was the highest during the three months ended June 30, 2026, compared with a low of $50.98 at June 30, 2026.

The quantity of bitcoin owned by the Trust and held by the bitcoin custodian decreased from 188,144 as of March 31, 2026 to 174,383 on June 30, 2026.

The decrease in quantity resulted from bitcoin transferred to pay the Sponsor fee and redemptions of Shares during the quarter, which corresponded to sales of bitcoin exceeding bitcoin purchased using proceeds from issuances of Shares.

The net decrease in net assets resulting from operations for the three months ended June 30, 2026, was $1.6 billion, primarily resulting from a net change in unrealized depreciation on investment in bitcoin of $1.9 billion and a net realized loss of $0.1 billion from the sale of the investment in bitcoin for the redemption of Shares, partially offset by a net realized gain of $0.3 billion from the distribution of the investment in bitcoin for the redemption of Shares.

The Quarter Ended June 30, 2025

The Trust’s net assets increased from approximately $16.3 billion as of March 31, 2025 to $21.6 billion as of June 30, 2025.

The change in the Trust’s net assets resulted from an increase in outstanding Shares, which rose from 225,528,476 as of March 31, 2025 to 230,728,476 as of June 30, 2025.

This was as a result of 27,975,000 Shares (1,119 Baskets) being created and

22,775,000 Shares (911 Baskets) being redeemed during the three months ended June 30, 2025, coupled with an increase in the price of bitcoin, which rose 29.25% from $82,956.00 as of March 31, 2025 to $107,221.67 as of June 30, 2025.

The Trust’s NAV per Share increased 29.66% from $72.36 as of March 31, 2025, to $93.83 as of June 30, 2025.

The Trust’s NAV per Share of $97.32 at May 22, 2025, was the highest during the three months ended June 30, 2025, compared with a low of $66.97 at April 8, 2025.

The quantity of bitcoin owned by the Trust and held by the bitcoin custodian increased from 196,933 as of March 31, 2025 to 201,347 on June 30, 2025.

The increase in quantity resulted from using net cash proceeds received from the increase in capital transactions to purchase bitcoin.

The net increase in net assets resulting from operations for the three months ended June 30, 2025, was $4.8 billion, primarily resulting from a net change in unrealized appreciation on investment in bitcoin of $4.8 billion.

The Six Months Ended June 30, 2026

The Trust’s net assets decreased from approximately $17.6 billion as of December 31, 2025 to $10.3 billion as of June 30, 2026.

The change in the Trust’s net assets resulted from a decrease in outstanding Shares, which decreased from 231,403,476 as of December 31, 2025 to 200,328,476 as of June 30, 2026.

This was as a result of 49,450,000 Shares (1,978 Baskets) being created and (80,525,000) Shares (3,221 Baskets) being redeemed during the six months ended June 30, 2026, coupled with a decrease in the price of bitcoin, which decreased 32.43% from $87,463.03 as of December 31, 2025 to $59,101.49 as of June 30, 2026.

The NAV per Share decreased 32.50% from $76.21 as of December 31, 2025, to $51.44 as of June 30, 2026.

The Trust’s NAV per Share decreased 33.01% from $76.10 as of December 31, 2025, to $50.98 as of June 30, 2026.

The Trust’s NAV per Share of $85.01 at January 14, 2026, was the highest during the six months ended June 30, 2026, compared with a low of $50.98 at June 30, 2026.

The quantity of bitcoin owned by the Trust and held by the bitcoin custodian decreased from 201,684 as of December 31, 2025 to 174,383 on June 30, 2026.

The net decrease in net assets resulting from operations for the six months ended June 30, 2026, was $5.3 billion, primarily resulting from a net change in unrealized depreciation on investment in bitcoin of $5.7 billion and a net realized loss of approximately $0.2 billion from the sale of the investment in bitcoin for the redemption of Shares, partially offset by a net realized gain of $0.5 billion from the distribution of the investment in bitcoin for the redemption of Shares.

The Six Months Ended June 30, 2025

The Trust’s net assets increased from approximately $18.8 billion as of December 31, 2024 to $21.6 billion as of June 30, 2025.

The change in the Trust’s net assets resulted from an increase in outstanding Shares, which rose from 230,678,476 as of December 31, 2024 to 230,728,476 as of June 30, 2025.

This was as a result of 59,575,000 Shares (2,383 Baskets) being created and 59,525,000 Shares (2,381 Baskets) being redeemed during the six months ended June 30, 2025, coupled with an increase in the price of bitcoin, which rose 14.84% from $93,365.36 as of December 31, 2024 to $107,221.67 as of June 30, 2025.

The Trust’s NAV per Share increased 14.70% from $81.80 as of December 31, 2024, to $93.83 as of June 30, 2025.

The Trust’s NAV per Share of $97.32 at May 22, 2025, was the highest during the six months ended June 30, 2025, compared with a low of $66.97 at April 8, 2025.

The quantity of bitcoin owned by the Trust and held by the bitcoin custodian decreased from 201,556 as of December 31, 2024 to 201,347 on June 30, 2025.

The net increase in net assets resulting from operations for the six months ended June 30, 2025, was $2.5 billion, primarily resulting from a net change in unrealized appreciation on investment in bitcoin of $2.8 billion and a net realized loss of approximately $0.3 billion from the sale of the investment in bitcoin for the redemption of Shares.

Cash Resources and Liquidity

8 unchanged sentences

While the Trust’s exposure under such indemnification provisions cannot be estimated, these general business indemnifications are not expected to have a material impact on a Trust’s financial position.

Sponsor Fee payments made to the Sponsor are calculated as a fixed percentage of the Trust’s Bitcoin Holdings.

Sponsor Fee payments made to the Sponsor are calculated as a fixed percentage of 0.25% of the Trust’s Bitcoin Holdings.

As such, the Sponsor cannot anticipate the payment amounts that will be required under these arrangements for future periods as the Trust’s Bitcoin Holdings are not known until a future date.

Selected Operating Data

March 31, 2026

June 30, 2026

Price of bitcoin on principal market (1)

Index price (2)

March 31, 2026

June 30, 2026

NAV per Share (3)

1 unchanged sentence

Trust’s NAV per Share (4)

(1) The Trust performed an assessment of the principal market at 11:59:59 p.m., EST, on March 31, 2026.

(1) The Trust performed an assessment of the principal market at 11:59:59 p.m., EST, on June 30, 2026.

(2) Index Price as represented by the Index as of 4:00 p.m., EST, on the last business day of the period.

The bitcoin spot markets included in the Index as of the last business day of the period were Bitstamp, Coinbase, Crypto.com, Gemini, Kraken, and LMAX Digital.

(3) The NAV per Share was calculated using the fair value of bitcoin based on the principal market price at 11:59:59 p.m., EST, on March 31, 2026.

(3) The NAV per Share was calculated using the fair value of bitcoin based on the principal market price at 11:59:59 p.m., EST, on June 30, 2026.

(4) The Trust’s NAV per Share is derived from the Index Price as represented by the Index as of 4:00 p.m., EST, on the last business day of the period.

1 unchanged sentence

Refer to the “Overview of the Trust” and “Valuation of Bitcoin and Computation of Net Asset Value” sections of Item 2 herein for a description of the Index methodology and calculation of the Trust’s NAV per Share.

As of 4:00 p.m., EST, on the last business day of the three months ended March 31, 2026, the Trust’s total value of bitcoin based on the Index Price (non-GAAP methodology) was $12,761,432,156, a difference of $56,766,879 to the GAAP value, which was $12,818,199,035, and the total market value of the Trust’s bitcoin based on the price of a bitcoin at 4:00 p.m., EST, in the principal market (non-GAAP methodology) was $12,757,174,452, a difference of $61,024,583 to the GAAP value, which was $12,818,199,035.

As of 4:00 p.m., EST, on the last business day of the three months ended June 30, 2026, the Trust’s total value of bitcoin based on the Index Price (non-GAAP methodology) was $10,215,251,308, a difference of $91,045,378 to the GAAP value, which was $10,306,296,686, and the total market value of the Trust’s bitcoin based on the price of bitcoin at 4:00 p.m., EST, in the principal market (non-GAAP methodology) was $10,239,166,196, a difference of $67,130,490 to the GAAP value, which was $10,306,296,686.

December 31, 2025

12 unchanged sentences

As of 4:00 p.m., EST, on the last business day of the year ended December 31, 2025, the Trust’s total value of bitcoin based on the Index Price (non-GAAP methodology) was $17,612,442,661, a difference of $27,483,529 to the GAAP value, which was $17,639,926,190, and the total market value of the Trust’s bitcoin based on the price of a bitcoin at 4:00 p.m., EST, in the principal market (non-GAAP methodology) was $17,656,256,573, a difference of $16,330,383 to the GAAP value, which was $17,639,926,190.

As of 4:00 p.m., EST, on the last business day of the year ended December 31, 2025, the Trust’s total value of bitcoin based on the Index Price (non-GAAP methodology) was $17,612,442,661, a difference of $27,483,529 to the GAAP value, which was $17,639,926,190, and the total market value of the Trust’s bitcoin based on the price of bitcoin at 4:00 p.m., EST, in the principal market (non-GAAP methodology) was $17,656,256,573, a difference of $16,330,383 to the GAAP value, which was $17,639,926,190.

Analysis of Price Movements

2 unchanged sentences

Movements may be influenced by various factors, including, but not limited to, government regulation, security breaches experienced by service providers, as well as political and economic uncertainties around the world.

The following chart illustrates the movement in the Index Price, the principal market price, and the Trust’s NAV per Share during the three months ended March 31, 2026.

During the three months ended March 31, 2026, the Index Price has ranged from $63,632.21 on February 5, 2026, to $97,568.00 on January 14, 2026.

The following chart illustrates the movement in the Index Price, the principal market price, and the Trust’s NAV per Share during the six months ended June 30, 2026.

During the six months ended June 30, 2026, the Index Price has ranged from $58,579.39 on June 30, 2026, to $97,568.00 on January 14, 2026.

The Sponsor has not observed a material difference between the Index Price and average prices from the constituent bitcoin spot markets individually or as a group.

During the three months ended March 31, 2026, the 11:59:59 p.m.

EST market price of bitcoin, as reported on the Trust’s principal market, has ranged from $63,351.99 on February 23, 2026, to $96,313.99 on January 14, 2026.

During the six months ended June 30, 2026, the 11:59:59 p.m.

EST market price of bitcoin, as reported on the Trust’s principal market, has ranged from $59,101.49 on June 30, 2026, to $96,313.99 on January 14, 2026.

Shares trade in the secondary market on the Exchange.

1 unchanged sentence

The amount of the discount or premium in the trading price relative to the Trust’s NAV per Share may be influenced by various factors, including the number of Shareholders who seek to purchase or sell Shares in the secondary market and the liquidity of bitcoin.

The following chart sets out the historical closing prices for the Shares as reported by the Exchange and the Trust’s NAV per Share during the three months ended March 31, 2026.

The following chart sets out the historical closing prices for the Shares as reported by the Exchange and the Trust’s NAV per Share during the six months ended June 30, 2026.

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

What changed 10-Q

Item 2. Management’s Discussion and Analysis