What changed in this filing

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Item 9A. Controls and Procedures

2024-02-23 compared with 2023-03-01 · 390 added, 239 removed, 623 unchanged (50% of the section changed)

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Based on their assessment and those criteria, the Principal Executive Officer and Principal Financial and Accounting Officer of the Sponsor concluded that the Trust maintained effective internal control over financial reporting as of December 31, 2023.

Marcum LLP, the independent registered public accounting firm that audited the financial statements as of and for the year ended December 31, 2022 included in this Annual Report on Form 10-K, as stated in their report which is included herein, issued an attestation report on the effectiveness of the Trust’s internal control over financial reporting as of December 31, 2022 on page F-2.

Marcum LLP, the independent registered public accounting firm that audited the financial statements as of and for the year ended December 31, 2023 included in this Annual Report on Form 10-K, as stated in their report which is included herein, issued an attestation report on the effectiveness of the Trust’s internal control over financial reporting as of December 31, 2023 on

Changes in Internal Control Over Financial Reporting

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Other Information

Not applicable.

No t applicable.

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.

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The Sponsor has a board of directors (the “Board”) that is responsible for managing and directing the affairs of the Sponsor.

The Board consists of Barry E.

Silbert, Mark Murphy and Mr.

Sonnenshein, who also retain the authority granted to them as officers under the limited liability company agreement of the Sponsor.

The Board consists of Mark Shifke, Matthew Kummell, Mr.

Sonnenshein, and Mr.

McGee, who also retain the authority granted to them as officers under the limited liability company agreement of the Sponsor.

The Sponsor has an Audit Committee.

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The Sponsor’s Code of Ethics is intended to be a codification of the business and ethical principles that guide the Sponsor, and to deter wrongdoing, to promote honest and ethical conduct, to avoid conflicts of interest, and to foster compliance with applicable governmental laws, rules and regulations, the prompt internal reporting of violations and accountability for adherence to this code.

Silbert, Chairman of the Board

Silbert, 46, is the founder of the Sponsor and was Chief Executive Officer of the Sponsor until January 2021.

Silbert is also the founder and Chief Executive Officer of Digital Currency Group, Inc.

(“DCG”), a global enterprise that builds, buys, and invests in blockchain companies all over the world.

DCG is the parent company of the Sponsor, CoinDesk and Genesis (the Authorized Participant’s only Liquidity Provider, as of the date of this Annual Report), and is the indirect parent company of Grayscale Securities (the only acting Authorized Participant of the Trust as of the date of this Annual Report).

A pioneer in Bitcoin investing, Mr.

Silbert began buying Bitcoin in 2012 and quickly established himself as one of the earliest and most active investors in the industry.

Silbert founded DCG in 2015 and today, DCG sits at the epicenter of the blockchain industry, backing more than 150 companies across 30 countries, including Coinbase, Ripple, and Chainalysis.

DCG also invests directly in digital currencies and other digital assets.

Prior to leading DCG, Mr.

Silbert was the founder and CEO of SecondMarket, a technology company that was acquired by Nasdaq.

Silbert has received numerous accolades for his leadership including Entrepreneur of the Year by both EY and Crain’s, and being selected to Fortune’s “40 under 40” list.

Before becoming an entrepreneur, Mr.

Silbert worked as an investment banker.

He graduated with honors from the Goizueta Business School of Emory University.

Mark Murphy, Board Member

Mark Murphy, 46, is the Chief Operating Officer of DCG.

In that role, he works closely with DCG’s subsidiaries on strategy, execution, marketing, and all management matters.

Murphy leads DCG’s legal, communications, marketing, brand, and public policy efforts, and supports Mr.

Silbert on day-to-day management of DCG.

He also advises DCG portfolio companies on public relations, brand, and marketing efforts.

Prior to serving as COO of DCG, Mr.

Murphy served as Head of Public Affairs.

Murphy is also President of the Board of Directors of Blockchain Association, the industry’s leading trade association.

Mark Shifke, Chairman of the Board

Mark Shifke, 64, is the Chief Financial Officer of DCG and has served as chairman of the Board since January 2024.

Since March 2021, Mr.

Shifke has served on the board of directors of Dock Ltd., a full-stack payments and digital banking platform.

Since September 2023, Mr.

Shifke has served on the board of directors of Luno, a cryptocurrency platform.

Shifke has nearly four decades of financial and fintech experience, and more than eight years of CFO experience leading two publicly-traded companies.

Prior to joining DCG, Mr.

Murphy led communications teams at Bloomberg, First Data, and SecondMarket.

Murphy worked as a commercial litigation attorney earlier in his career.

He is a graduate of Miami University (B.A.) and St.

John’s University School of Law (J.D.).

Shifke served as CFO of Billtrust, a company focused on providing AR and cloud-based solutions around payments, and as CFO of Green Dot (NYSE:

GDOT), a mobile banking company and payments platform.

Previously, Mr.

Shifke led teams at JPMorgan Chase and Goldman Sachs, specializing in M&A Structuring and Advisory, as well as Tax Asset Investments.

Shifke also served as the Head of International Structured Finance Group at KPMG.

Shifke began his career at Davis Polk, where he was a partner.

He is a graduate of Tulane University (B.A./J.D.) and the New York University School of Law (LL.M.

in Taxation).

Matthew Kummell, Board Member

Matt Kummell, 48, is Senior Vice President of Operations at DCG and has served as a director of the Sponsor since January 2024.

In his role at DCG, Mr.

Kummell leads the business’s post-investment efforts, including investment operations and value creation with regard to DCG’s portfolio companies.

Since December 2023, Mr.

Kummell has served as a member of the board of directors of Foundry, a digital asset mining and staking company.

Until November 2023, Mr.

Kummell served on the board of directors of CoinDesk, Inc., a digital media, events and information services company for the crypto asset and blockchain technology community.

Until January 2012, Mr.

Kummell served on the board of directors of Derivix Corporation, a financial services software company.

Prior to joining DCG, Mr.

Kummell was the Head of North America for Citi’s Business Advisory Services team, a strategic consulting practice focused on institutional investor clients in Citi’s Markets division.

Kummell has also held strategic and front-office leadership roles at Citadel, Balyasny Asset Management, and S.A.C.

Capital Advisors, the predecessor to Point 72 Asset Management.

Previously, Mr.

Kummell served as a case team leader at Bain & Company in its Boston headquarters.

Kummell is an Adjunct Professor at the Tuck School of Business at Dartmouth College.

He is a graduate of the University of California, Los Angeles (B.A.) and the Tuck School of Business at Dartmouth College (MBA).

Michael Sonnenshein, Board Member and Chief Executive Officer

Michael Sonnenshein, 36, is CEO of the Sponsor, having served as Managing Director of the Sponsor since 2018.

Michael Sonnenshein, 37, has been CEO of the Sponsor since January 2021 and has served as a director of the Sponsor since February 2020.

Before serving as CEO, Mr.

Sonnenshein served as Managing Director of the Sponsor since 2018.

In this role, Mr.

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Sonnenshein was honored in 2021 as one of 100 People Transforming Business by Business Insider and in 2018 as the publication’s Rising Stars of Wall Street.

Edward McGee, Chief Financial Officer

Edward McGee, 39, is the Chief Financial Officer of the Sponsor, having served as Vice President, Finance and Controller of the Sponsor since June 2019.

Edward McGee, Board Member and Chief Financial Officer

Edward McGee, 40, has been the Chief Financial Officer of the Sponsor since January 2022 and has served as a director of the Sponsor since January 2024.

Before serving as CFO, Mr.

McGee was Vice President, Finance and Controller of the Sponsor since June 2019.

Prior to taking on his role at the Sponsor, Mr.

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Hugh Ross, Chief Operating Officer

Hugh Ross, 55, is the Chief Operating Officer of the Sponsor since February 2021.

Hugh Ross, 56, has been the Chief Operating Officer of the Sponsor since February 2021.

Prior to joining the Sponsor, Mr.

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Prior to joining Goldman Sachs, Mr.

Ross worked as an in-house counsel for a transfer agent and started his career as a securities industry attorney representing broker-dealers and investment advisers.

Ross worked as an in-house

counsel for a transfer agent and started his career as a securities industry attorney representing broker-dealers and investment advisers.

Ross is a graduate of the Goizueta Business School at Emory University (B.B.A) and New York Law School (J.D.).

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Digital Currency Group, Inc.

Genesis Global Trading, Inc.

Digital Currency Group, Inc.

Genesis Global Capital, LLC (2)

Directors & Officers of the Sponsor:

Matthew Kummell

Michael Sonnenshein

Directors & officers of the Sponsor as a group

Silbert is the Chief Executive Officer of Digital Currency Group, Inc.

and in such capacity may be deemed to have voting and dispositive power over the securities held, directly or indirectly, by such entity.

On March 10, 2021, the Board approved the purchase by DCG, the parent company of the Sponsor, of up to $250 million worth of Shares of the Trust.

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From July 1, 2022 through February 19, 2024, DCG did not purchase any Shares of the Trust under this authorization.

Genesis Global Trading, Inc.

is a wholly owned subsidiary of Digital Currency Group, Inc.

Genesis Global Capital, LLC is a wholly owned subsidiary of Genesis Global Holdco, LLC, which is a wholly owned subsidiary of Digital Currency Group, Inc.

Genesis Global Capital, LLC, together with its parent company, Genesis Global Holdco, LLC, and certain other affiliates, filed a voluntary petition for reorganization under the Bankruptcy Code in January 2023.

Prior to filing for reorganization under the Bankruptcy Code, Genesis Global Capital, LLC had pledged 30,905,782 Shares, which had previously had their Rule 144 transfer restriction legends removed as described in “Item 1.

Business—Description of the Shares—Transfer Restrictions”, to a third party as collateral under an agreement in August 2022.

Genesis Global Capital, LLC is a wholly owned subsidiary of Genesis Global Holdco, LLC, which is a wholly owned subsidiary of, but not controlled by, Digital Currency Group, Inc.

Genesis Global Capital, LLC, together with its parent company, Genesis Global Holdco, LLC, and certain other affiliates, filed a voluntary petition for reorganization under Chapter 11 of the Bankruptcy Code in January 2023.

Prior to filing for reorganization under the Bankruptcy Code, Genesis Global Capital, LLC had pledged 30,905,782 Shares to a third party as collateral under an agreement in August 2022.

In November 2022, the counterparty communicated to Genesis Global Capital, LLC that it was foreclosing on such pledged shares.

As a result, those pledged shares are not included in the above share counts.

However, those shares are the subject of a pending adversary proceeding in the Chapter 11 case of Genesis Global Capital, LLC, which seeks the return of such pledged shares to Genesis Global Capital, LLC.

Depending on the final outcome of the adversary proceeding, Genesis Global Capital, LLC may be deemed the beneficial owner of the additional 30,905,782 shares, which shares may also be sold, transferred, or liquidated for the benefit of creditors in connection with the Chapter 11 case.

The Trust does not have any directors, officers or employees.

Under the Trust Agreement, all management functions of the Trust have been delegated to and are conducted by the Sponsor, its agents and its affiliates.

Does not include Shares held by Digital Currency Group, Inc.

Silbert is the Chief Executive Officer of Digital Currency Group, Inc.

and may be deemed to have voting and dispositive power over the securities held, directly or indirectly, by such entity.

Represents beneficial ownership of less than 1%.

Unless otherwise indicated, the address for each shareholder listed in the table above is c/o Grayscale Investments, LLC, 290 Harbor Drive, 4th Floor, Stamford, CT 06902.

Unless otherwise indicated, the address for each shareholder listed in the table above is c/o Grayscale Investments, LLC, 290 Harbor Drive, 4th Floor, Stamford, Connecticut 06902.

Certain Relationships and Related Transactions and Director Independence

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Digital Currency Group, Inc.

is (i) the sole member and parent company of the Sponsor, and parent company of Genesis, the Authorized Participant’s only Liquidity Provider as of the date of this Annual Report, (ii) the indirect parent company of the Index Provider, and of Grayscale Securities, the only acting Authorized Participant, as of the date of this Annual Report, and (iii) a minority interest holder in Coinbase, which operates Coinbase Pro, one of the Digital Asset Exchanges included in the Index, and which is also the parent company of the Custodian, representing less than 1.0% of its equity and (iv) a minority interest holder in Kraken, one of the Digital Asset Exchanges included in the Index, representing less than 1.0% of its equity.

is (i) the sole member and parent company of the Sponsor, and parent company of Genesis, one of the Liquidity Providers from October 3, 2022 through September 12, 2023, (ii) the indirect parent company of Grayscale Securities, the Authorized Participant from October 3, 2022 through January 10, 2024, (iii) formerly the indirect parent company of the Index Provider (prior to its sale to an unaffiliated third party on November 20, 2023), (iv) a minority interest holder in Coinbase, Inc., which operates Coinbase, one of the Digital Asset Trading Platforms included in the Index, and which is also the parent company of the Custodian, representing less than 1.0% of its equity and (v) a minority interest holder in Kraken, one of the Digital Asset Trading Platforms included in the Index, representing less than 1.0% of its equity.

Digital Currency Group, Inc.

has investments in a large number of digital assets and companies involved in the digital asset ecosystem, including exchanges and custodians.

has investments in a large number of digital assets and companies involved in the digital asset ecosystem, including trading platforms and custodians.

Digital Currency Group, Inc.’s positions on changes that should be adopted in the Bitcoin Network could be adverse to positions that would benefit the Trust or its shareholders.

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The Sponsor will, however, not retain any affiliated service providers for the Trust which the Sponsor has reason to believe would knowingly or deliberately favor any other client over the Trust.

The Authorized Participant

Authorized Participant

Prior to October 3, 2022, Genesis, an affiliate of the Trust and the Sponsor, was the only Authorized Participant and was party to a participant agreement with the Sponsor and the Trust.

Since October 3, 2022, the only Authorized Participant is Grayscale Securities, an affiliate of the Trust and the Sponsor.

From October 3, 2022 through January 10, 2024, Grayscale Securities, an affiliate of the Trust and the Sponsor, was the Authorized Participant.

As a result of this affiliation, the Sponsor has an incentive to resolve questions between Grayscale Securities, on the one hand, and the Trust and shareholders, on the other hand, in favor of Grayscale Securities (including, but not limited to, questions as to the calculation of the Basket Amount).

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are FINRA-registered representatives who maintain their licenses through Grayscale Securities.

As of the date of this Annual Report, Grayscale Securities has engaged Genesis, an affiliate of the Trust and the Sponsor, to act as its Liquidity Provider.

In its capacity as the Liquidity Provider of Grayscale Securities, Genesis may engage in Bitcoin trading with the Trust’s affiliated entities.

For example, when the Sponsor receives the Sponsor’s Fee in Bitcoins, it may sell the Bitcoins through Genesis.

For this service, Genesis charges the Sponsor a transaction fee, which is not borne by the Trust.

Liquidity Provider

Prior to September 12, 2023, Genesis, an affiliate of the Trust and the Sponsor, had been engaged to act as one of the Liquidity Providers.

In its capacity as a Liquidity Provider, Genesis engaged in Bitcoin trading with the Trust’s affiliated entities.

For example, when the Sponsor received the Sponsor’s Fee in Bitcoins, it sold the Bitcoins through Genesis.

For this service, Genesis charged the Sponsor a transaction fee, which was not borne by the Trust.

Additionally, the Sponsor’s parent company, Digital Currency Group, Inc., is the sole shareholder and parent company of Genesis, in addition to a customer of Genesis, and may buy or sell Bitcoins through Genesis from time to time, independent of the Trust.

As of September 12, 2023, Genesis no longer served as a Liquidity Provider.

Proprietary Trading/Other Clients

Because the officers of the Sponsor may trade Bitcoins for their own personal trading accounts (subject to certain internal trading policies and procedures) at the same time as they are managing the account of the Trust, the activities of the officers of the Sponsor, subject to their fiduciary duties, may, from time-to-time, result in their taking positions in their personal trading accounts which are opposite of the positions taken for the Trust.

result in their taking positions in their personal trading accounts which are opposite of the positions taken for the Trust.

Records of the Sponsor’s officers’ personal trading accounts will not be available for inspection by shareholders.

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Digital Currency Group, Inc.

is the indirect parent company of the Index Provider.

As a result, the Index Provider is an affiliate of the Sponsor and the Trust and has an incentive to resolve questions regarding, or changes to, the manner in which the Index is constructed and in which the Index Price is calculated in a way that favors the Sponsor and the Trust.

In addition, Genesis, the only Liquidity Provider of the Authorized Participant as of the date hereof, licenses and uses a trading software platform provided by the Index Provider to operate its Bitcoin trading desk and to facilitate Genesis’s actions as Liquidity Provider of the Authorized Participant.

Although the Index Provider does not currently utilize data from over-the-counter markets or derivative platforms, per the terms of the license, the Index Provider is entitled to use the over-the-counter trading data from Genesis in the Index.

was the indirect parent company of the Index Provider until the Index Provider was sold by Digital Currency Group, Inc.

to an unaffiliated third party in November 2023.

Prior to its sale by Digital Currency Group Inc., the Index Provider was an affiliate of the Sponsor and the Trust and had an incentive to resolve questions regarding, or changes to, the manner in which the Index was constructed and in which the Index Price was calculated in a way that favored the Sponsor and the Trust.

Principal Accountant Fees and Services

Fees for services performed by Marcum LLP and Friedman LLP, prior to the acquisition of certain assets of Friedman LLP by Marcum LLP effective September 1, 2022, for the years ended December 31, 2023 and 2022 were:

Audit fees (1)

The Sponsor was notified that certain assets of Friedman LLP (“Friedman”), the Trust’s independent registered public accounting firm, were acquired by Marcum LLP (“Marcum”) effective September 1, 2022.

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As of September 1, 2022, the services previously provided by Friedman are provided by Marcum.

Approximately $204,750 of the total fees for audit services during the year ended December 31, 2022 were for services provided by Marcum.

In the table above, in accordance with the SEC’s definitions and rules, Audit Fees are fees paid to Marcum for professional services for the audit of the Trust’s financial statements included in the annual report on Form 10-K and review of financial statements included in the quarterly reports on Form 10-Q, and for services that are normally provided by the accountants in connection with regulatory filings or engagements.

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Exhibit Description

Fifth Amended and Restated Declaration of Trust and Trust Agreement (incorporated by reference to Exhibit 4.1 of the Registration Statement on Form 10 filed by the Registrant on November 19, 2019).

Amendment No.

1 to the Fifth Amended and Restated Declaration of Trust and Trust Agreement (incorporated by reference to Exhibit 4.2 of the Registration Statement on Form 10 filed by the Registrant on November 19, 2019).

Sixth Amended and Restated Declaration of Trust and Trust Agreement (incorporated by reference to Exhibit 4.1 of the Form 8-K filed by the Registrant on January 9, 2024).

Amendment No.

2 to the Fifth Amended and Restated Declaration of Trust and Trust Agreement (incorporated by reference to Exhibit 4.3 of the Annual Report on Form 10-K filed by the Registrant on March 20, 2020).

Certificate of Amendment to Certificate of Trust (attached as Exhibit A to Amendment No.

1 to the Fifth Amended and Restated Declaration of Trust and Trust Agreement).

Participant Agreement, dated October 3, 2022, between the Sponsor and Grayscale Securities, LLC, (incorporated by reference to Exhibit 4.1 of the current report on Form 8-K filed by the Registrant on October 3, 2022)

Description of Registrant’s Securities (incorporated by reference to Exhibit 4.6 of the Annual Report on Form 10-K filed by the Registrant on March 20, 2020).

Amended and Restated Custodian Agreement dated June 29, 2022, between the Sponsor and the Custodian (incorporated by reference to Exhibit 10.1 of the Quarterly Report on Form 10-Q filed by the Registrant on August 5, 2022).

Distribution and Marketing Agreement, dated October 3, 2022, between the Sponsor and Grayscale Securities, LLC (incorporated by reference to Exhibit 10.1 of the current report on Form 8-K filed by the Registrant on October 3, 2022).

Index License Agreement (incorporated by reference to Exhibit 10.1 of the current report on Form 8-K filed by the Registrant on February 4, 2022).

Transfer Agency and Service Agreement (incorporated by reference to Exhibit 10.4 of the Registration Statement on Form 10 filed by the Registrant on November 19, 2019).

1 to the Sixth Amended and Restated Declaration of Trust and Trust Agreement (incorporated by reference to Exhibit 4.2 of the Form 8-K filed by the Registrant on January 9, 2024).

Certificate of Amendment to Certificate of Trust (attached as Exhibit A to the Sixth Amended and Restated Declaration of Trust and Trust Agreement).

Form of Participant Agreement (incorporated by reference to Exhibit 4.5 of Amendment No.

3 to the Registration Statement on Form S-3 filed by the Trust with the SEC on January 2, 2024).

Description of Registrant’s Securities.

Prime Broker Agreement, dated December 29, 2023, between the Sponsor and the Prime Broker (incorporated by reference to Exhibit 99.1 of Amendment No.

3 to the Registration Statement on Form S-3 filed by the Trust with the SEC on January 2, 2024).

Fund Administrative and Accounting Agreement (incorporated by reference to Exhibit 10.5 of the current report on Form 8-K filed by the Registrant on July 9,2021).

Index License Agreement (incorporated by reference to Exhibit 10.1 of the current report on Form 8-K filed by the Registrant on February 4, 2022).

Amendment No.

1 to the Index License Agreement dated June 20, 2023, between the Sponsor and Index Provider (incorporated by reference to Exhibit 10.1 of the current report on Form 8-K filed by the Registrant on June 23, 2023).

Marketing Agent Agreement, dated August 18, 2022, between the Sponsor and the Marketing Agent (incorporated by reference to Exhibit 99.5 of Amendment No.

3 to the Registration Statement on Form S-3 filed by the Trust with the SEC on January 2, 2024).

Amendment No.

1 to the Marketing Agreement, dated January 15, 2024, between the Sponsor and the Marketing Agent.

Transfer Agency and Service Agreement, dated November 16, 2023, between the Trust and the Transfer Agent (incorporated by reference to Exhibit 10.1 of the Current Report on Form 8-K filed by the Registrant on November 21, 2023).

Co-Transfer Agency Agreement, dated November 16, 2023, between the Sponsor and Continental Stock Transfer & Trust Company (incorporated by reference to Exhibit 10.2 of the Current Report on Form 8-K filed by the Registrant on November 21, 2023).

Certification by Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

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Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

Recovery of Erroneously Awarded Compensation Policy.

Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

Inline XBRL Taxonomy Extension Schema Document

Exhibit Description

Inline XBRL Taxonomy Extension Calculation Linkbase Document

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dollars (or other applicable fiat currency) at such time to enable the Trust to timely pay any Additional Trust Expenses, through use of the Sponsor’s commercially reasonable efforts to obtain the highest such price.

“ Additional Trust Expenses ”— Together, any expenses incurred by the Trust in addition to the Sponsor’s Fee that are not Sponsor-paid Expenses, including, but not limited to, (i) taxes and governmental charges, (ii) expenses and costs of any extraordinary services performed by the Sponsor (or any other service provider) on behalf of the Trust to protect the Trust or the interests of shareholders (including in connection with any Incidental Rights and any IR Virtual Currency), (iii) any indemnification of the Custodian or other agents, service providers or counterparties of the Trust, (iv) the fees and expenses related to the listing, quotation or trading of the Shares on any Secondary Market (including legal, marketing and audit fees and expenses) to the extent exceeding $600,000 in any given fiscal year and (v) extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation, regulatory enforcement or investigation matters.

“ Additional Trust Expenses ”— Together, any expenses incurred by the Trust in addition to the Sponsor’s Fee that are not Sponsor-paid Expenses, including, but not limited to, (i) taxes and governmental charges, (ii) expenses and costs of any extraordinary services performed by the Sponsor (or any other service provider) on behalf of the Trust to protect the Trust or the interests of shareholders, (iii) any indemnification of the Custodian or other agents, service providers or counterparties of the Trust, (iv) the fees and expenses related to the listing, quotation or trading of the Shares on any Secondary Market (including legal, marketing and audit fees and expenses) to the extent exceeding $600,000 in any given fiscal year and (v) extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation, regulatory enforcement or investigation matters.

“ Administrator ”— The Bank of New York Mellon, a New York corporation authorized to do a banking business.

“ Administrator Fee ”— The fee payable to any administrator of the Trust for services it provides to the Trust, which the Sponsor will pay such administrator as a Sponsor-paid Expense.

“ Affirmative Action ”— A decision by the Trust to acquire or abandon specific Incidental Rights and IR Virtual Currency at any time prior to the time of a creation of shares.

“ Agent ”— A Person appointed by the Trust to act on behalf of the shareholders in connection with any distribution of Incidental Rights and/or IR Virtual Currency.

“ Authorized Participant ”— Certain eligible financial institutions that have entered into an agreement with the Trust and the Sponsor concerning the creation of Shares.

Each Authorized Participant (i) is a registered broker-dealer, (ii) has entered into a Participant Agreement with the Sponsor and (iii) owns a digital wallet address that is known to the Custodian as belonging to the Authorized Participant or such Authorized Participant’s Liquidity Provider.

“ Affirmative Action ”— A decision by the Trust to acquire or abandon specific Incidental Rights and IR Virtual Currency at any time prior to the time of a creation or redemption of Shares.

“ AP Designee ”— An Authorized Participant’s designee in connection with In-Kind Orders (to the extent In-Kind Regulatory Approval is obtained).

“ Authorized Participant ”— Certain eligible financial institutions that have entered into an agreement with the Trust and the Sponsor concerning the creation or redemption of Shares.

Each Authorized Participant (i) is a registered broker-dealer and (ii) has entered into a Participant Agreement with the Sponsor and the Transfer Agent.

Subject to In-Kind Regulatory Approval, in the future any Authorized Participants creating and redeeming Shares through In-Kind Orders must also own, or their AP Designee (as defined above) must own, a Bitcoin wallet address that is known to the Custodian as belonging to the Authorized Participant or its AP Designee and maintain an account with the Custodian.

“ Basket ”— A block of 10,000 Shares.

“ Basket Amount ”— On any trade date, the number of Bitcoins required as of such trade date for each Creation Basket, as determined by dividing (x) the number of Bitcoins owned by the Trust at 4:00 p.m., New York time, on such trade date, after deducting the number of Bitcoins representing the U.S.

dollar value of accrued but unpaid fees and expenses of the Trust (converted using the Index Price at such time, carried to the eighth decimal place), by (y) the number of Shares outstanding at such time (with the quotient so obtained calculated to one one-hundred-millionth of one Bitcoin (i.e., carried to the eighth decimal place)), and multiplying such quotient by 100.

“ Basket Amount ”— On any trade date, the number of Bitcoins required as of such trade date for the creation or redemption of a Basket, as determined by dividing (x) the number of Bitcoins owned by the Trust at 4:00 p.m., New York time, on such trade date, after deducting the number of Bitcoins representing the U.S.

dollar value of accrued but unpaid fees and expenses of the Trust (converted using the Index Price at such time, and carried to the eighth decimal place), by (y) the number of Shares outstanding at such time (with the quotient so obtained calculated to one one-hundred-millionth of one Bitcoin (i.e., carried to the eighth decimal place)), and multiplying such quotient by 10,000.

“ Basket NAV ”— The U.S.

dollar value of a Basket calculated by multiplying the Basket Amount by the Index Price as of the trade date.

“ Bitcoin ” or “ BTC ”— A type of digital asset based on an open-source cryptographic protocol existing on the Bitcoin Network, comprising units that constitute the assets underlying the Trust’s Shares.

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“ Bitcoin Network ”— The online, end-user-to-end-user network hosting the public transaction ledger, known as the Blockchain, and the source code comprising the basis for the cryptographic and algorithmic protocols governing the Bitcoin Network.

Business—Overview of the Bitcoin Industry and Market” in our Annual Report.

“ Bitcoin SegWit2X ”— A type of digital asset based on an open source cryptographic protocol existing on the Bitcoin SegWit2X network, which came into existence following the Bitcoin hard fork on December 28, 2017.

“ Blockchain ” or “ Bitcoin Blockchain ”— The public transaction ledger of the Bitcoin Network on which transactions in Bitcoin are recorded.

“ Cash Account ”— The account maintained by the Transfer Agent for purposes of receiving cash from, and distributing cash to, Authorized Participants in connection with creations and redemptions pursuant to Cash Orders.

For the avoidance of doubt, the Trust shall have no interest (beneficial, equitable or otherwise) in the Cash Account or any cash held therein.

“ Cash Order ”— An order for the creation or redemption of Shares pursuant to procedures facilitated by the Transfer Agent and pursuant to which a Liquidity Provider is engaged to facilitate the purchase or sale of Bitcoin.

“ CEA ”— Commodity Exchange Act of 1936, as amended.

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Internal Revenue Code of 1986, as amended.

“ Coinbase Credit ”— Coinbase Credit, Inc.

“ Covered Person ”— The Sponsor and its affiliates.

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“ Creation Time ”— With respect to the creation of any Shares by the Trust, the time at which the Trust creates such Shares.

“ Custodial Services ”— The Custodian’s services that (i) allow Bitcoins to be deposited from a public blockchain address to the Trust’s Digital Asset Account and (ii) allow the Trust and the Sponsor to withdraw Bitcoin from the Trust’s Digital Asset Account to a public blockchain address the Trust or the Sponsor controls pursuant to instructions the Trust or the Sponsor provides to the Custodian.

“ Custodial and Prime Broker Services ”— The services of the Custodian and the Prime Broker that provide for:

(i) holding of the Trust’s Bitcoin in the Vault Balance and the Settlement Balance;

(ii) transfer of the Trust’s Bitcoin between the relevant Vault Balance and the Settlement Balance;

(iii) the deposit of Bitcoin from a public blockchain address into the respective account or accounts in which the Vault Balance or the Settlement Balance are maintained;

and (iv) the withdrawal of Bitcoin from the Vault Balance to a public blockchain address the Trust controls.

“ Custodian ”— Coinbase Custody Trust Company, LLC.

“ Custodian Agreement ”— The Amended and Restated Custodial Services Agreement, dated as of June 29, 2022, by and between the Trust and the Sponsor and Custodian that governs the Trust’s and the Sponsor’s use of the Custodial Services provided by the Custodian as a fiduciary with respect to the Trust’s assets.

“ Custodian Fee ”— Fee payable to the Custodian for services it provides to the Trust, which the Sponsor shall pay to the Custodian as a Sponsor-paid Expense.

“ Digital Asset Account ”— A segregated custody account controlled and secured by the Custodian to store private keys, which allow for the transfer of ownership or control of the Trust’s Bitcoins on the Trust’s behalf.

“ Digital Asset Exchange ”— An electronic marketplace where exchange participants may trade, buy and sell Bitcoins based on bid-ask trading.

The largest Digital Asset Exchanges are online and typically trade on a 24-hour basis, publishing transaction price and volume data.

“ Digital Asset Exchange Market ”— The global exchange market for the trading of Bitcoins, which consists of transactions on electronic Digital Asset Exchanges.

“ Digital Asset Holdings ”— The aggregate value, expressed in U.S.

dollars, of the Trust’s assets (other than U.S.

dollars or other fiat currency), less its liabilities (which include estimated accrued but unpaid fees and expenses) calculated in the manner set forth under “Item 1.

Business—Valuation of Bitcoin and Determination of Digital Asset Holdings.” See also “Item 1.

Business—Investment Objective” for a description of the Trust’s NAV, as calculated in accordance with GAAP.

“ Digital Asset Holdings Fee Basis Amount ”— The amount on which the Sponsor’s Fee for the Trust is based, as calculated in the manner set forth under “Item 1.

Business—Valuation of Bitcoin and Determination of Digital Asset Holdings”.

“ Digital Asset Market ”— A “Brokered Market,” “Dealer Market,” “Principal-to-Principal Market” or “Exchange Market,” as each such term is defined in the Financial Accounting Standards Board Accounting Standards Codification Master Glossary.

“ Custodian Fee ”— Fee payable to the Custodian and the Prime Broker for services they provide to the Trust, which the Sponsor shall pay to the Custodian and the Prime Broker as a Sponsor-paid Expense.

“ DCG ”— Digital Currency Group, Inc.

“ Digital Asset Market ”— A “Brokered Market,” “Dealer Market,” “Principal-to-Principal Market” or “Exchange Market” (referred to as “Trading Platform Market” in this Annual Report), as each such term is defined in the Financial Accounting Standards Board Accounting Standards Codification Master Glossary.

“ Digital Asset Trading Platform ”— An electronic marketplace where trading platform participants may trade, buy and sell Bitcoins based on bid-ask trading.

The largest Digital Asset Trading Platforms are online and typically trade on a 24-hour basis, publishing transaction price and volume data.

“ Digital Asset Trading Platform Market ”— The global exchange market for the trading of Bitcoins, which consists of transactions on electronic Digital Asset Trading Platforms.

“ DSTA ”— The Delaware Statutory Trust Act, as amended.

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“ GAAP ”— United States generally accepted accounting principles.

“ Genesis ”— Genesis Global Trading, Inc., a wholly owned subsidiary of Digital Currency Group, Inc., which as of the date of this Annual Report, is the only Liquidity Provider of the Authorized Participant.

“ Grayscale Securities ”—Grayscale Securities, LLC, a wholly owned subsidiary of the Sponsor, which as of the date of this Annual Report, is the only acting Authorized Participant.

“ Genesis ”— Genesis Global Trading, Inc., a wholly owned subsidiary of Digital Currency Group, Inc., which served as a Liquidity Provider from October 3, 2022 through September 12, 2023.

“ Grayscale Securities ”— Grayscale Securities, LLC, a wholly owned subsidiary of the Sponsor, which served as the Authorized Participant from October 3, 2022 through January 10, 2024.

“ Incidental Rights ”— Rights to acquire, or otherwise establish dominion and control over, any virtual currency or other asset or right, which rights are incident to the Trust’s ownership of Bitcoins and arise without any action of the Trust, or of the Sponsor or Trustee on behalf of the Trust.

“ Index ”— The CoinDesk Bitcoin Price Index (XBX).

“ Index License Agreement ”— The license agreement, dated as of February 1, 2022, between the Index Provider and the Sponsor governing the Sponsor’s use of the Index for calculation of the Index Price.

1 thereto and as the same may be amended from time to time.

“ Index Price ”— The U.S.

dollar value of a Bitcoin derived from the Digital Asset Exchanges that are reflected in the Index, calculated at 4:00 p.m., New York time, on each business day.

Business—Overview of the Bitcoin Industry and Market—Bitcoin Value—The Index and the Index Price” for a description of how the Index Price is calculated.

dollar value of a Bitcoin derived from the Digital Asset Trading Platforms that are reflected in the Index, calculated at 4:00 p.m., New York time, on each business day.

Business—Overview of the Bitcoin Industry and Market—The Index and the Index Price” for a description of how the Index Price is calculated.

For purposes of the Trust Agreement, the term Bitcoin Index Price shall mean the Index Price as defined herein.

“ Index Provider ”— CoinDesk Indices, Inc., a Delaware corporation that publishes the Index.

DCG is the indirect parent company of CoinDesk Indices, Inc.

Prior to its sale to an unaffiliated third party on November 20, 2023, DCG was the indirect parent company of CoinDesk Indices, Inc.

As a result, CoinDesk Indices, Inc.

is an affiliate of the Sponsor and the Trust and is considered a related party of the Trust.

was an affiliate of the Sponsor and the Trust and was considered a related party of the Trust.

“ Investment Advisers Act ”— Investment Advisers Act of 1940, as amended.

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Department of the Treasury.

“ Liquidity Provider ”—A service provider engaged by an Authorized Participant to source Bitcoin on behalf of the Authorized Participant.

“ In-Kind Order ”— An order for the creation or redemption of Shares pursuant to which the Authorized Participant (or its AP Designee) will deliver or receive Bitcoin directly from the Trust’s Vault Balance.

Because In-Kind Regulatory Approval has not been obtained, at this time Shares will not be created or redeemed through In-Kind Orders.

“ In-Kind Regulatory Approval ”— The necessary regulatory approval to permit NYSE Arca to list the Shares of the Trust utilizing a structure that allows the Trust to create and redeem Shares via in-kind transactions with Authorized Participants or their AP Designees in exchange for Bitcoin.

In common with other spot Bitcoin exchange-traded products, the Trust is not at this time able to create and redeem shares via in-kind transactions with Authorized Participants, and there has yet to be definitive regulatory guidance on whether and how registered broker-dealers can hold and deal in Bitcoin in compliance with the federal securities laws.

To the extent further regulatory clarity emerges, the Sponsor expects NYSE Arca to seek the necessary regulatory approval to amend its listing rules to permit the Trust to create and redeem Shares through In-Kind Orders.

There can be no assurance as to when such regulatory clarity will emerge, or when NYSE Arca will seek or obtain such regulatory approval, if at all.

“Liquidity Engager” — Grayscale Investments, LLC, acting other than in its capacity as Sponsor, and in its capacity to engage one or more Liquidity Providers.

“ Liquidity Provider ”— One or more eligible companies that facilitate the purchase and sale of Bitcoins in connection with creations or redemptions pursuant to Cash Orders.

The Liquidity Providers with which Grayscale Investments, LLC, acting in its capacity as the Liquidity Engager, will engage in Bitcoin transactions are third parties that are not affiliated with the Sponsor or the Trust and are not acting as agents of the Trust, the Sponsor, or any Authorized Participant, and all transactions will be done on an arms-length basis.

Except for the contractual relationships between each Liquidity Provider and Grayscale Investments, LLC in its capacity as the Liquidity Engager, there is no contractual relationship between each Liquidity Provider and the Trust, the Sponsor, or any Authorized Participant.

“ Marketing Agent ”— Foreside Fund Services, LLC.

“ Marketing Fee ”— Fee payable to the marketer for services it provides to the Trust, which the Sponsor will pay to the marketer as a Sponsor-paid Expense.

“ NAV ”— The net asset value of the Trust determined on a GAAP basis.

“ Old Index Price ”—The volume-weighted average index price of a Bitcoin derived from the Digital Asset Exchanges that are reflected in the Index, calculated by applying a weighting algorithm to the price and trading volume data for the immediately preceding 24-hour period as of 4:00 p.m., New York time, on each business day, derived from the selected Digital Asset Exchanges that are reflected in the Index on such trade date.

“ NAV ”— The aggregate value, expressed in U.S.

dollars, of the Trust’s assets (other than U.S.

dollars or other fiat currency), less its liabilities (which include estimated accrued but unpaid fees and expenses), a Non-GAAP metric, calculated in the manner set forth under “Item 1.

Business—Valuation of Bitcoin and Determination of NAV.” See also “Item 1.

Business—Investment Objective” for a description of the Trust’s Principal Market NAV, as calculated in accordance with GAAP.

Prior to December 26, 2023, NAV was referred to as Digital Asset Holdings.

For purposes of the Trust Agreement, the term Bitcoin Holdings shall mean the NAV as defined herein.

“ NAV Fee Basis Amount ”— The amount on which the Sponsor’s Fee for the Trust is based, as calculated in the manner set forth under “Item 1.

Business—Valuation of Bitcoin and Determination of NAV.” For purposes of the Trust Agreement, the term Bitcoin Holdings Basis Amount shall mean the NAV Fee Basis Amount as defined herein.

“ NYSE Arca ”— NYSE Arca, Inc.

“ OTCQX ”— The OTCQX tier of OTC Markets Group Inc.

“ Participant Agreement ”— An agreement entered into by an Authorized Participant with the Sponsor that provides the procedures for the creation of Baskets and for the delivery of Bitcoins required for Creation Baskets.

“ Pre-Creation Abandonment ”—The abandonment by the Trust, irrevocably for no direct or indirect consideration, all Incidental Rights and IR Virtual Currency to which the Trust would otherwise be entitled, effective immediately prior to a Creation Time for the Trust.

“ Pre-Creation Abandonment Notice ”—A notice delivered by the Sponsor to the former custodian and the current Custodian, on behalf of the Trust, stating that the Trust is abandoning irrevocably for no direct or indirect consideration, effective immediately prior to each Creation Time, all Incidental Rights and IR Virtual Currency to which it would otherwise be entitled as of such time and with respect to which the Trust has not taken any Affirmative Action at or prior to such time.

“ Participant Agreement ”— An agreement entered into by an Authorized Participant with the Sponsor and the Transfer Agent, that provides the procedures for the creation and redemption of Baskets via a Liquidity Provider.

“ Pre-Creation/Redemption Abandonment ”— The abandonment by the Trust, irrevocably for no direct or indirect consideration, all Incidental Rights and IR Virtual Currency to which the Trust would otherwise be entitled, effective immediately prior to a Creation Time or a Redemption Time (as the case may be) for the Trust.

“ Pre-Creation Abandonment Notice ”— A notice, as supplemented from time to time, delivered by the Sponsor to the former custodian and each of the Prime Broker, the Custodian and Coinbase Credit, on behalf of the Trust, stating that the Trust is abandoning irrevocably for no direct or indirect consideration, effective immediately prior to each Creation Time, all Incidental Rights and IR Virtual Currency to which it would otherwise be entitled as of such time and with respect to which the Trust has not taken any Affirmative Action at or prior to such time.

“ Pre-Redemption Abandonment Notice ”— A notice, as supplemented from time to time, delivered by the Sponsor to each of the Prime Broker, the Custodian and Coinbase Credit, on behalf of the Trust, stating that the Trust is abandoning irrevocably for no direct or indirect consideration effective immediately prior to each Redemption Time, all Incidental Rights and IR Virtual Currency to which it would otherwise be entitled as of such time and with respect to which the Trust has not taken any Affirmative Action at or prior to such time.

“ Prime Broker ”— Coinbase, Inc.

“ Prime Broker Agreement ”— The Prime Broker Agreement, dated as of December 29, 2023, by and among the Trust, the Sponsor and the Prime Broker, on behalf of itself, the Custodian and Coinbase Credit, that governs the Trust’s and the Sponsor’s use of the Custodial and Prime Broker Services provided by the Custodian and the Prime Broker.

“ Principal Market NAV ”— The net asset value of the Trust determined on a GAAP basis.

Prior to December 26, 2023, Principal Market NAV was referred to as NAV.

“ Redemption Time ”— With respect to the redemption of any Shares by the Trust, the time at which the Trust redeems such Shares.

“ SEC ”— The U.S.

Securities and Exchange Commission.

“ Secondary Market ”— Any marketplace or other alternative trading system, as determined by the Sponsor, on which the Shares may then be listed, quoted or traded, including but not limited to, the OTCQX tier of the OTC Markets Group Inc.

“ Securities Act ”— The Securities Act of 1933, as amended.

“ Settlement Balance ”— An account controlled and maintained by the Custodian to which cash and digital assets of the Trust are credited on the Trust’s behalf.

“ Shares ”— Common units of fractional undivided beneficial interest in, and ownership of, the Trust.

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“ Sponsor’s Fee ”— A fee, payable in Bitcoins, which accrues daily in U.S.

dollars at an annual rate of 2.0% of the Digital Asset Holdings Fee Basis Amount of the Trust as of 4:00 p.m., New York time, on each day;

provided that for a day that is not a business day, the calculation of the Sponsor’s Fee will be based on the Digital Asset Holdings Fee Basis Amount from the most recent business day, reduced by the accrued and unpaid Sponsor’s Fee for such most recent business day and for each day after such most recent business day and prior to the relevant calculation date.

“ Total Basket Amount ”—With respect to any creation order, the applicable Basket Amount multiplied by the number of Baskets being created.

dollars at an annual rate of 1.5% of the NAV Fee Basis Amount of the Trust as of 4:00 p.m., New York time, on each day;

provided that for a day that is not a business day, the calculation of the Sponsor’s Fee will be based on the NAV Fee Basis Amount from the most recent business day, reduced by the accrued and unpaid Sponsor’s Fee for such most recent business day and for each day after such most recent business day and prior to the relevant calculation date.

“ Total Basket Amount ”— With respect to any creation or redemption order, the applicable Basket Amount multiplied by the number of Baskets being created or redeemed.

“ Total Basket NAV ”— The applicable Basket NAV Amount multiplied by the number of Baskets being created or redeemed.

“ Transfer Agency and Service Agreement ”— The agreement between the Sponsor and the Transfer Agent which sets forth the obligations and responsibilities of the Transfer Agent with respect to transfer agency services and related matters.

“ Transfer Agent ”— Continental Stock Transfer & Trust Company, a Delaware corporation.

“ Transfer Agent ”— The Bank of New York Mellon, a New York corporation authorized to do a banking business.

“ Transfer Agent Fee ”— Fee payable to the Transfer Agent for services it provides to the Trust, which the Sponsor will pay to the Transfer Agent as a Sponsor-paid Expense.

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“ Trust ”— Grayscale Bitcoin Trust (BTC), a Delaware statutory trust, formed on September 13, 2013 under the DSTA and pursuant to the Trust Agreement.

“ Trust Agreement ”— The Fifth Amended and Restated Declaration of Trust and Trust Agreement between the Trustee and the Sponsor establishing and governing the operations of the Trust, as amended by Amendments No.

“ Trust Agreement ”— The Sixth Amended and Restated Declaration of Trust and Trust Agreement between the Trustee and the Sponsor establishing and governing the operations of the Trust, as amended by Amendments No.

1 thereto and as the same may be amended from time to time.

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dollar ” or “ $ ”— United States dollar or dollars.

“ Variable Fee ”— An amount in cash based on the Total Basket NAV, which shall be paid by the Authorized Participant in connection with Cash Orders.

The amount may be changed by the Sponsor in its sole discretion at any time.

“ Vault Balance ”— A segregated custody account controlled and secured by the Custodian to store private keys, which allow for the transfer of ownership or control of the Trust’s Bitcoins on the Trust’s behalf.

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned in the capacities* indicated, thereunto duly authorized.

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/s/ Michael Sonnenshein

MichaelSonnenshein

Michael Sonnenshein

Member of the Board of Directors and Chief Executive Officer

(PrincipalExecutive Officer)*

(Principal Executive Officer)*

/s/ Edward McGee

Chief Financial Officer

Member of the Board of Directors and Chief Financial Officer

(Principal Financial Officer and Principal Accounting Officer)*

/s/ Mark Shifke

Chairman of the Board of Directors

/s/ Mark Murphy

/s/ Matthew Kummell

Matthew Kummell

Member of the Board of Directors

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Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities, including the schedule of investment, of Grayscale Bitcoin Trust (BTC) (the “Trust”) as of December 31, 2022, and the related statements of operations and changes in net assets for the year ended December 31, 2022, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Trust as of December 31, 2022, and the results of its operations for the year ended December 31, 2022, in conformity with accounting principles generally accepted in the United States of America.

We have audited the accompanying statements of assets and liabilities, including the schedules of investment, of Grayscale Bitcoin Trust (BTC) (the “Trust”) as of December 31, 2023 and 2022, and the related statements of operations and changes in net assets for each of the two years in the period ended December 31, 2023, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Trust as of December 31, 2023 and 2022, and the results of its operations for each of the two years in the period ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the Trust’s internal control over financial reporting as of December 31, 2023, based on the criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in 2013 and our report dated February 23, 2024 ,

2 unchanged sentences

These financial statements are the responsibility of the management of the Trust’s Sponsor, Grayscale Investments, LLC.

Our responsibility is to express an opinion on the Trust’s financial statements based on our audit.

Our responsibility is to express an opinion on the Trust’s financial statements based on our audits.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Trust in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audit provides a reasonable basis for our opinion.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

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The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the accounts or disclosures to which it relates.

Evaluation of audit evidence pertaining to the existence and control of digital assets

We identified the evaluation of audit evidence pertaining to the existence of digital assets and whether the Trust controls the digital assets as a critical audit matter.

Subjective auditor judgment was involved in determining the nature and extent of evidence required to assess the existence of digital assets and whether the Trust controls the digital assets.

Evaluation of audit evidence pertaining to the existence, rights and control of digital assets

We identified the evaluation of audit evidence pertaining to the existence of digital assets and whether the Trust controls and has the rights to the digital assets as a critical audit matter.

Subjective auditor judgment was involved in determining the nature and extent of evidence required to assess the existence of digital assets and whether the Trust controls and has the rights to the digital assets.

Control over the digital assets is proven through access to private cryptographic keys stored using third-party custodial services.

The following are the primary procedures we performed to address this critical audit matter.

We involved professionals with specialized skills and knowledge in blockchain technology and digital assets and applied auditor judgment in determining the nature and extent of audit evidence required.

We consulted with subject matter experts regarding our planned audit response to address risks of material misstatement of digital assets.

We evaluated and tested the design and operating effectiveness of certain internal controls over digital assets, including controls over the comparison of the Trust’s records of digital assets held to the custodial records.

We evaluated the sufficiency of the design and operating effectiveness of internal controls at the custodian, including the processes surrounding private key lifecycle management, the private key generation process, the storage of private keys and the authorization of digital asset transactions by evaluating subservice organization reports.

We evaluated the sufficiency of the design and operating effectiveness of internal controls at the custodian, including the processes surrounding private key lifecycle management, the storage of private keys and the authorization of digital asset transactions by evaluating service and subservice organization reports.

We obtained confirmation from the custodian of the Trust’s digital assets as of December 31, 2023, and compared the total digital assets confirmed to the Trust’s record of digital asset holdings.

We also compared the Trust’s record of digital asset holdings to the records on the public blockchain using an audit software tool.

We also compared the Trust’s record of digital asset holdings to the records on the public blockchain and evaluated the reliability of audit evidence obtained from public blockchains.

We tested movements on the blockchain to evidence that the Trust controls the digital assets through the custodian account.

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/s/ Marcum LLP

We have served as the Trust’s auditor since 2015 (such date takes into account the acquisition of

certain assets of

Friedman LLP by Marcum LLP effective September 1, 2022).

We have served as the Trust’s auditor since 2015 (such date takes into account the acquisition of certain assets of Friedman LLP by Marcum LLP effective September 1, 2022).

New York , New York

February 28, 2023

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

ON INTERNAL CONTROL OVER FINANCIAL REPORTING

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM ON INTERNAL CONTROL OVER FINANCIAL REPORTING

To the Shareholders and Sponsor of

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issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the statement of assets and liabilities, including the schedule of investment, of the Trust as of December 31, 2022, and the related statements of operations and changes in net assets for the year ended December 31, 2022, and the related notes (collectively referred to as the “financial statements”) and our report dated February 28, 2023, expressed an unqualified opinion on those financial statements.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (“PCAOB”), the statements of assets and liabilities, including the schedules of investment, of the Trust as of December 31, 2023 and 2022, and the related statements of operations and changes in net assets and the related notes for each of the two years in the period ended December 31, 2023, of the Trust (collectively referred to as the “financial statements”) and our report dated February 23, 2024, expressed an unqualified opinion on those financial statements.

Basis for Opinion

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Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles,

and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company;

and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

An entity’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.

An entity’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the entity;

(2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the entity are being made only in accordance with authorizations of management and directors of the entity;

and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the entity’s assets that could have a material effect on the financial statements.

Because of the inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

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Opinion on the Financial Statements

We have audited the accompanying statement of assets and liabilities, including the schedule of investment, of Grayscale Bitcoin Trust (BTC) (the “Trust”) as of December 31, 2021, and the related statements of operations and changes in net assets for each of the years in the two-year period ended December 31, 2021, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Trust as of December 31, 2021, and the results of its operations for each of the years in the two-year period ended December 31, 2021, in conformity with accounting principles generally accepted in the United States of America.

We have audited the statements of operations and changes in net assets of Grayscale Bitcoin Trust (BTC) (the “Trust”) for the year ended December 31, 2021, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the results of the Trust’s operations for the year ended December 31, 2021, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the management of the Trust’s Sponsor, Grayscale Investments, LLC.

Our responsibility is to express an opinion on the Trust’s financial statements based on our audits.

We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Trust in accordance with the U.S.

Our responsibility is to express an opinion on the Trust’s financial statements based on our audit.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Trust in accordance with the U.S.