What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2025-03-26 compared with 2024-03-28 · 547 added, 518 removed, 680 unchanged (61% of the section changed)

The VanEck Bitcoin Trust (the “Trust”) was formed

as a Delaware statutory trust on December 17, 2020.

The Trust operates pursuant to the Third Amended and Restated Trust Agreement

dated as of March 1, 2024 (the “Trust Agreement”).

The purpose of the Trust is to own bitcoin transferred to the Trust

in exchange for shares issued by the Trust (the “Shares”).

Each Share represents a fractional undivided beneficial

interest in and ownership of the Trust.

All Share amounts and per Share amounts referenced in Item 1 have

been adjusted to reflect the 4 for 1 share split that occurred on February 14, 2025.

The VanEck Bitcoin ETF (the “Trust”) was formed as a

Delaware statutory trust on December 17, 2020.

The Trust operates pursuant to the Third Amended and Restated Trust Agreement dated

as of March 1, 2024 (the “Trust Agreement”).

The purpose of the Trust is to own bitcoin transferred to the Trust in

exchange for shares issued by the Trust (the “Shares”).

Each Share represents a fractional undivided beneficial interest

in and ownership of the Trust.

The assets of the Trust consist primarily of bitcoin held by a third-party custodian.

3 unchanged sentences

Eck Associates Corporation (“VanEck”).

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

the Trust (the “Trustee”).

Gemini Trust Company, LLC is the custodian of the Trust (the “Bitcoin Custodian”),

who holds all of the Trust’s bitcoin on the Trust’s behalf.

State Street Bank and Trust Company (“State Street”)

serves as the Trust’s administrator (the “Administrator”), the transfer agent for the Trust (the “Transfer

Agent”) and the cash custodian of the Trust (the “Cash Custodian”).

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

of the Trust (the “Trustee”).

Gemini Trust Company, LLC (the “Bitcoin Custodian”) and

Coinbase Custody Trust Company, LLC (the “Additional Bitcoin Custodian”, and together with the Bitcoin Custodian, the

“Bitcoin Custodians”) are the custodians of the Trust, who hold all of the Trust’s bitcoin on the Trust’s

State Street Bank and Trust Company (“State Street”) serves as the Trust’s administrator (the “Administrator”),

the transfer agent for the Trust (the “Transfer Agent”) and the cash custodian of the Trust (the “Cash Custodian”).

On December 21, 2023, Van Eck Associates Corporation (“VanEck”

12 unchanged sentences

Outstanding Shares of the Trust were 48,500,000 at December 31, 2024.

The Trust is not actively managed and will not take any actions

to take advantage, or mitigate the impacts, of volatility in the price of bitcoin.

The Trust is not actively managed and will not take any actions to

take advantage, or mitigate the impacts, of volatility in the price of bitcoin.

The activities of the Trust include (i) selling Shares in blocks

6 unchanged sentences

to Authorized Participants redeeming Shares or to pay the Sponsor’s Fee and Trust expenses not assumed by the Sponsor, if

The Trust sells or redeems its Shares in Baskets

that are based on the amount of bitcoin represented by the Basket being created, the amount of bitcoin being equal to the combined

NAV of the number of Shares included in the Basket (net of the accrued but unpaid remuneration due the Sponsor (“Sponsor

Fee”) and any accrued but unpaid expenses or liabilities not assumed by the Sponsor).

The Trust currently conducts subscriptions

and redemptions solely in cash.

Authorized Participants deliver cash to create Baskets and will receive only cash when redeeming

The Sponsor of the Trust maintains a website at

https://www.vaneck.com/us/en/investments/bitcoin-trust-hodl/, through which the Trust’s annual reports on Form 10-K, quarterly

reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a)

or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), are made

available free of charge after they have been

filed or furnished to the Securities and Exchange Commission (the “SEC”).

The information on the Trust’s website is

not, and shall not be deemed to be, part of this report or incorporated into any other filings we make with the SEC.

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

The Trust sells or redeems its Shares in Baskets that are

based on the amount of bitcoin represented by the Basket being created, the amount of bitcoin being equal to the combined NAV of

the number of Shares included in the Basket (net of the accrued but unpaid remuneration due the Sponsor (“Sponsor Fee”)

and any accrued but unpaid expenses or liabilities not assumed by the Sponsor).

The Trust currently conducts subscriptions and

redemptions solely in cash.

Authorized Participants deliver cash to create Baskets and will receive only cash when redeeming Shares.

The Sponsor of the Trust maintains a website at https://www.vaneck.com/us/en/investments/bitcoin-trust-hodl/,

through which the Trust’s annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments

to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the

“Exchange Act”), are made

available free of charge after they have been filed or

furnished to the Securities and Exchange Commission (the “SEC”).

The information on the Trust’s website is not,

and shall not be deemed to be, part of this report or incorporated into any other filings we make with the SEC.

Additional information

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

Trust Objective

The Trust’s investment objective is to reflect

the performance of the price of bitcoin less the expenses of the Trust’s operations.

The Trust provides investors with the

opportunity to access the market for bitcoin through Shares held in a traditional brokerage account without the potential barriers

to entry or risks involved with holding or transferring bitcoin directly, acquiring it from an exchange, or mining it.

believes that the design of the Trust enables certain investors to more effectively and efficiently implement strategic and tactical

asset allocation strategies that use bitcoin by investing in the Shares rather than purchasing, holding and trading bitcoin directly

The Trust’s investment objective is to reflect the

performance of the price of bitcoin less the expenses of the Trust’s operations.

The Trust provides investors with the opportunity

to access the market for bitcoin through Shares held in a traditional brokerage account without the potential barriers to entry

or risks involved with holding or transferring bitcoin directly, acquiring it from an exchange, or mining it.

The Sponsor believes

that the design of the Trust enables certain investors to more effectively and efficiently implement strategic and tactical asset

allocation strategies that use bitcoin by investing in the Shares rather than purchasing, holding and trading bitcoin directly

or through derivatives.

The Trust is a passive investment vehicle that

does not seek to pursue any investment strategy beyond tracking the price of bitcoin.

As a result, the Trust will not attempt to

speculatively sell bitcoin at times when its price is high or speculatively acquire bitcoin at low prices in the expectation of

future price increases, nor will the Trust attempt to avoid losses or hedge exposure arising from the risk of changes in the price

The Trust is a passive investment vehicle that does not

seek to pursue any investment strategy beyond tracking the price of bitcoin.

As a result, the Trust will not attempt to speculatively

sell bitcoin at times when its price is high or speculatively acquire bitcoin at low prices in the expectation of future price

increases, nor will the Trust attempt to avoid losses or hedge exposure arising from the risk of changes in the price of bitcoin.

The Shares are listed for trading on the Cboe BZX Exchange, Inc.

14 unchanged sentences

participants.

Because peer-to-peer transfers of bitcoin are recorded on the

“Bitcoin Blockchain,” which is a digital public recordkeeping system or ledger, buying, holding and selling bitcoin

is very different than buying, holding and selling more conventional instruments like cash, stocks or bonds.

Miners authenticate

and bundle bitcoin transactions sequentially into files called “blocks,” which requires performing computational work

to solve a cryptographic puzzle set by the Bitcoin network’s software protocol.

Because each solved block contains a reference

to the previous block, they form a chronological “chain” back to the first bitcoin transaction.

Copies of the Bitcoin

Blockchain are stored in a decentralized manner on the computers of each individual Bitcoin network full node, i.e., any user who

chooses to maintain on their computer a full copy of the Bitcoin Blockchain as well as related software.

Each bitcoin is associated

with a set of unique cryptographic “keys,” in the form of a string of numbers and letters, which allow whoever is in

possession of the private key to assign that bitcoin in a transfer that the Bitcoin network will recognize.

Because peer-to-peer transfers of bitcoin are recorded on the “Bitcoin

Blockchain,” which is a digital public recordkeeping system or ledger, buying, holding and selling bitcoin is very different

than buying, holding and selling more conventional instruments like cash, stocks or bonds.

Miners authenticate and bundle bitcoin

transactions sequentially into files called “blocks,” which requires performing computational work to solve a cryptographic

puzzle set by the Bitcoin network’s software protocol.

Because each solved block contains a reference to the previous block,

they form a chronological “chain” back to the first bitcoin transaction.

Copies of the Bitcoin Blockchain are stored

in a decentralized manner on the computers of each individual Bitcoin network full node, i.e., any user who chooses to maintain

on their computer a full copy of the Bitcoin Blockchain as well as related software.

Each bitcoin is associated with a set of unique

cryptographic “keys,” in the form of a string of numbers and letters, which allow whoever is in possession of the private

key to assign that bitcoin in a transfer that the Bitcoin network will recognize.

Bitcoin must either be acquired through the process of “mining,”

4 unchanged sentences

and holding the bitcoin.

Alternatively, purchasing bitcoin on a bitcoin trading platform

requires choosing a trading platform, opening an account, and transferring funds to the trading platform in order to purchase the

Alternatively, purchasing bitcoin on a bitcoin trading platform requires

choosing a trading platform, opening an account, and transferring funds to the trading platform in order to purchase the bitcoin.

Transactions on exchanges are not ordinarily recorded on the Bitcoin Blockchain.

There are currently a large number of

bitcoin trading platforms from which to choose, the quality and reliability of which varies significantly.

The value of bitcoin

within the market is determined, in part, by the supply of and demand for bitcoin in the global bitcoin market, market expectations

for the adoption of bitcoin as a store of value, the number of merchants that accept bitcoin as a form of payment, and the volume

of peer-to-peer transactions, among other factors.

Outside of exchanges, Bitcoin can be traded OTC in transactions

that are not publicly reported.

The OTC market is largely institutional in nature, and OTC market participants generally consist

of institutional entities, such as firms that offer two-sided liquidity for bitcoin, investment managers, proprietary trading firms,

There are currently a large number of bitcoin

trading platforms from which to choose, the quality and reliability of which varies significantly.

The value of bitcoin within

the market is determined, in part, by the supply of and demand for bitcoin in the global bitcoin market, market expectations for

the adoption of bitcoin as a store of value, the number of merchants that accept bitcoin as a form of payment, and the volume of

peer-to-peer transactions, among other factors.

Outside of exchanges, Bitcoin can be traded OTC in transactions that

are not publicly reported.

The OTC market is largely institutional in nature, and OTC market participants generally consist of

institutional entities, such as firms that offer two-sided liquidity for bitcoin, investment managers, proprietary trading firms,

high-net-worth individuals that trade bitcoin on a proprietary basis, entities with sizeable bitcoin holdings, and family offices.

12 unchanged sentences

Bitcoin Value

The value of bitcoin is determined by the

value that various market participants place on bitcoin through their transactions.

The most common means of determining the value

of a bitcoin is by surveying one or more bitcoin trading platforms where bitcoin is traded publicly and transparently.

of bitcoin on the bitcoin market has exhibited periods of extreme volatility, which could have a negative impact on the performance

The value of bitcoin is determined by the value

that various market participants place on bitcoin through their transactions.

The most common means of determining the value of

a bitcoin is by surveying one or more bitcoin trading platforms where bitcoin is traded publicly and transparently.

bitcoin on the bitcoin market has exhibited periods of extreme volatility, which could have a negative impact on the performance

of the Trust.

For example, between November 2021 and November 2022, the price of bitcoin fell from an all-time high of $68,789

As of February 29, 2024, the price of bitcoin has increased to $61,179.

As of February 28, 2025, the price of bitcoin has increased to $84,147(source:

On exchanges, bitcoin is traded with publicly

8 unchanged sentences

reported by MarketVector from December 31, 2022 to February 28, 2025:

Bitcoin Exchanges included in the MarketVector TM Bitcoin Benchmark Rate

Bitcoin Exchanges included in the MarketVector TM Bitcoin Benchmark

as of February 28, 2025

1 unchanged sentence

(in thousands of USD)

60,751,371.12

439,593,456.10

10,190,354.97

79,890,041.55

98,679,706.67

The market share for BTC/USD trading of

the five constituent trading platforms over the past four calendar quarters is shown in the table below:

The Trust and the Sponsor face competition with respect to the

creation of competing products, including with respect to the creation of competing exchange-traded bitcoin products.

be no assurance that the Trust will grow to or maintain an economically viable size.

In addition, commercial banks and other financial institutions

have a number of initiatives that incorporate new technologies, including blockchain and similar technologies, into their payments

and settlement activities, which could compete with, or reduce the demand for, bitcoin.

The market share for BTC/USD trading of the

five constituent trading platforms over the past four calendar quarters is shown in the table below:

The Trust and the Sponsor face competition with respect to the creation

of competing products, including with respect to the creation of competing exchange-traded bitcoin products.

There can be no assurance

that the Trust will grow to or maintain an economically viable size.

In addition, commercial banks and other financial institutions have

a number of initiatives that incorporate new technologies, including blockchain and similar technologies, into their payments and

settlement activities, which could compete with, or reduce the demand for, bitcoin.

The Trust competes with direct investments

3 unchanged sentences

The MarketVector TM Bitcoin Benchmark Rate

MarketVector is the index sponsor and index administrator for

MarketVector is the index sponsor and index administrator for the

MarketVector is a wholly-owned subsidiary of VanEck.

2 unchanged sentences

The MarketVector TM Bitcoin Benchmark Rate is a U.S.

dollar-denominated composite reference rate for the price of bitcoin.

The Index is calculated daily between 00:00 and 24:00 Central

European Time (“CET”) and the Index values are disseminated to data vendors.

dollar-denominated

composite reference rate for the price of bitcoin.

The Index is calculated daily between 00:00 and 24:00 Central European Time

(“CET”) and the Index values are disseminated to data vendors.

The Index is disseminated in U.S.

and the closing and intraday value is calculated over twenty-three minute intervals pursuant to a methodology referred to as an

equal-weighted average of the volume-weighted median price.

dollars and the closing

and intraday value is calculated over twenty-three minute intervals pursuant to a methodology referred to as an equal-weighted

average of the volume-weighted median price.

The MarketVector TM Bitcoin Benchmark Rate is designed

21 unchanged sentences

The MarketVector TM Bitcoin Benchmark Rate is rebalanced at 16:00:00

GMT/BST on the last

business day of each of February and August.

The current constituent

trading platforms of the MarketVector TM Bitcoin Benchmark Rate are Bitstamp, Coinbase, itBit, LMAX, and Kraken.

GMT/BST on the last business day of each of February and August.

The current constituent trading platforms of the MarketVector TM

Bitcoin Benchmark Rate are Bitfinex, Bitstamp, Coinbase, LMAX, and Kraken.

Net Asset Value Determinations

3 unchanged sentences

holdings as reconciled to the Bitcoin Custodian’s accounts on a market approach, determined on a daily basis in accordance

with the MarketVectorTM Bitcoin Benchmark Rate price at 4:00 p.m.

with the MarketVector TM Bitcoin Benchmark Rate price at 4:00 p.m.

Eastern Time (“ET”).

3 unchanged sentences

dividing that total by the total number of outstanding Shares.

The Trust Agreement gives the Sponsor the exclusive authority

to determine the Trust’s NAV and the Trust’s NAV per Share, which it has delegated to the Administrator.

The Administrator calculates the NAV of

the Trust once each Exchange trading day.

The Trust Agreement gives the Sponsor the exclusive authority to

determine the Trust’s NAV and the Trust’s NAV per Share, which it has delegated to the Administrator.

The Administrator calculates the NAV of the

Trust once each Exchange trading day.

The NAV for a normal trading day will be released after 4:00 p.m.

Trading during

the core trading session on the Exchange typically closes at 4:00 p.m.

However, NAVs are not officially struck until later

in the day (often by 5:30 p.m.

Trading during the

core trading session on the Exchange typically closes at 4:00 p.m.

However, NAVs are not officially struck until later in the

day (often by 5:30 p.m.

ET and generally no later than 8:00 p.m.

1 unchanged sentence

ET and 5:30 p.m.

later) provides an opportunity to detect, flag, investigate, and correct unusual pricing should it occur.

The Sponsor will monitor

for significant events related to crypto assets that may impact the value of bitcoin and will determine in good faith, and in accordance

with its valuation policies and procedures, whether to fair value the Trust’s bitcoin on a given day based (e.g., if the

MarketVector TM Bitcoin Benchmark Rate is not available the Sponsor).

In certain circumstances, the Sponsor will determine

whether to fair value the Trust’s bitcoin on a given day on whether certain pre-determined criteria have been met.

if the MarketVector TM Bitcoin Benchmark Rate deviates by more than a pre-determined amount from an alternate benchmark

available to the Sponsor, then the Sponsor may determine to utilize the alternate benchmark.

The Sponsor may also fair value the

Trust’s bitcoin using observed market transactions from one or more exchanges.

The Sponsor may also fair value the Trust’s

bitcoin using a combination of inputs in certain situations (e.g., using observed market transactions, OTC quotations from brokers,

ET (or later)

provides an opportunity to detect, flag, investigate, and correct unusual pricing should it occur.

The Sponsor will monitor for

significant events related to crypto assets that may impact the value of bitcoin and will determine in good faith, and in accordance

with its valuation policies and procedures, whether to fair value the Trust’s bitcoin on a given day (e.g., if the MarketVector TM

Bitcoin Benchmark Rate is not available the Sponsor).

In certain circumstances, the Sponsor will determine whether to fair value

the Trust’s bitcoin on a given day based on whether certain pre-determined criteria have been met.

For example, if the MarketVector TM

Bitcoin Benchmark Rate deviates by more than a pre-determined amount from an alternate benchmark available to the Sponsor, then

the Sponsor may determine to utilize the alternate benchmark.

The Sponsor may also fair value the Trust’s bitcoin using observed

market transactions from one or more exchanges.

The Sponsor may also fair value the Trust’s bitcoin using a combination of

inputs in certain situations (e.g., using observed market transactions, OTC quotations from brokers, etc.).

Accordingly, the NAV of the Trust may reflect

7 unchanged sentences

The Sponsor, in conjunction with the Administrator,

will work in good faith to determine the fair value and implement the correct of the Trust’s NAV.

In addition, in order to

provide updated information relating to the Trust for use by Shareholders and market professionals, ICE Data Indices, LLC will

will work in good faith to determine the fair value and the correct calculation of the Trust’s NAV.

In addition, in order

to provide updated information relating to the Trust for use by Shareholders and market professionals, ICE Data Indices, LLC will

calculate and disseminate throughout the core trading session on each trading day an updated intraday indicative value (“IIV”).

3 unchanged sentences

Share” basis.

The IIV disseminated during the Exchange

core trading session hours should not be viewed as an actual real time update of the NAV, because NAV per Share is calculated only

once at the end of each trading day based upon the relevant end of day values of the Trust’s investments.

The Trust will

provide the IIV per Share updated every 15 seconds, as calculated

by the Exchange or a third-party financial data provider during the Exchange’s regular trading hours (9:30 a.m.

ICE Data Indices, LLC will

disseminate the IIV value through the facilities

of CTA/CQ High Speed Lines.

In addition, the indicative fund value will be published on the Exchange’s website and will be

available through on-line information services such as Bloomberg and Reuters.

The IIV may differ from the NAV due to the differences

in the time window of trades used to calculate each price (the NAV uses a sixty-minute window, whereas the IIV draws prices from

the last trade on each exchange in an effort to produce a relevant, real-time price).

The Sponsor does not believe this will cause

confusion in the marketplace, as Authorized Participants are the only Shareholders who interact with the NAV and the Sponsor will

communicate its NAV calculation methodology clearly.

The IIV disseminated during the Exchange core trading session hours

should not be viewed as an actual real time update of the NAV, because NAV per Share is calculated only once at the end of each

trading day based upon the relevant end of day values of the Trust’s investments.

The Trust will provide the IIV per Share

updated every 15 seconds, as calculated by the Exchange or a third-party financial data provider during the Exchange’s regular

trading hours (9:30 a.m.

ICE Data Indices, LLC will disseminate the IIV value through the facilities of CTA/CQ

High Speed Lines.

In addition, the indicative fund value will be published on the Exchange’s website and will be available

through on-line information services such as Bloomberg and Reuters.

The IIV may differ from the NAV due to the differences in the

time window of trades used to calculate each price (the NAV uses a sixty-minute window, whereas the IIV draws prices from the last

trade on each exchange in an effort to produce a relevant, real-time price).

The Sponsor does not believe this will cause confusion

in the marketplace, as Authorized Participants are the only Shareholders who interact with the NAV and the Sponsor will communicate

its NAV calculation methodology clearly.

There are many instances in the market today

2 unchanged sentences

this situation.

The Sponsor believes that the IIV closely tracks the globally integrated bitcoin price as reflected on the contributing

The Sponsor believes that the IIV tracks the globally integrated bitcoin price as reflected on the contributing

real bitcoin trading platforms.

7 unchanged sentences

For example, if the Trust appears to be

trading at a discount compared to the IIV, a market professional could buy the Trust’s Shares on the Exchange and sell short

trading at a discount compared to the IIV, a market professional

could buy the Trust’s Shares on the Exchange and sell short

futures contracts.

2 unchanged sentences

Secondary Market Trading

The Trust 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 Trust or the

distribution by the Trust of the amount of bitcoin (or corresponding amount of cash) equal to 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.

The Trust 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 Trust or the distribution

by the Trust of the amount of bitcoin (or corresponding amount of cash) equal to 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.

As discussed above, Authorized Participants are the only persons

5 unchanged sentences

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

Authorized Participants 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 the Exchange, the NAV of the Trust at the time the Authorized Participant 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 bitcoin or other portfolio investments.

Baskets are generally redeemed when the price per Share is at a discount

to the NAV per Share.

Shares initially comprising the same Basket but offered by Authorized Participants to the public at different

times may have different offering prices.

An order for one or more Baskets may be placed by an Authorized Participant on behalf

of multiple clients.

Authorized Participants who make deposits with the Trust in exchange for Baskets receive no fees, commissions

or other forms of compensation or inducement of any kind from either the Trust or the Sponsor and no such person has any obligation

or responsibility to the Sponsor or the Trust to effect any sale or resale of Shares.

Shares trade in the secondary market on the

Authorized Participants 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 the Exchange, the NAV of the Trust at the time the Authorized Participant 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 bitcoin or other portfolio investments.

Baskets are generally redeemed when the price per Share is at a discount to the NAV

Shares initially comprising the same Basket but offered by Authorized Participants to the public at different times

may have different offering prices.

An order for one or more Baskets may be placed by an Authorized Participant on behalf of multiple

Authorized Participants who make deposits with the Trust in exchange for Baskets receive no fees, commissions or other

forms of compensation or inducement of any kind from either the Trust or the Sponsor and no such person has any obligation or responsibility

to the Sponsor or the Trust to effect any sale or resale of Shares.

Shares trade in the secondary market on the Exchange.

Shares are expected to 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 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.

discount or premium in the trading price relative to the 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 Sponsor arranged for the creation of the Trust and is responsible

3 unchanged sentences

The Sponsor appoints and may remove the Trust’s other service providers,

including the Trustee, Administrator, Transfer Agent, Bitcoin Custodian, and Marketing Agent (as defined below), as well as any

additional, replacement, or successor service providers.

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

for litigation expenses and other extraordinary expenses) out of the Sponsor’s unified fee.

including the Trustee, Administrator, Transfer Agent, Bitcoin Custodian, Additional Bitcoin Custodian and Marketing Agent (as defined

below), as well as any additional, replacement, or successor service providers.

The Sponsor has agreed to pay all ordinary operating

expenses (except for litigation expenses and other extraordinary expenses) out of the Sponsor’s unified fee.

The Cash Custodian

4 unchanged sentences

for the issuance or redemption, as the case may be, of Shares in creation unit aggregations of the Trust after the end of each

Under the Cash Custody Agreement between State Street and the

Trust, State Street may act as custodian for the Trust’s non-bitcoin assets, if any, and as custodian for the Trust’s

cash (in such capacity, the “Cash Custodian”).

The Cash Custodian has agreed to, among other things, open and maintain

a separate deposit account or accounts of the Trust, to determine the amount of bitcoin and/or cash required for an issuance or

redemption of shares in a Basket and to release and deliver non-bitcoin assets and pay out cash.

The Cash Custodian shall credit to the deposit account(s) all

cash received by the Cash Custodian from or for the account of the Trust.

Upon an instruction to purchase Shares for the account

of the Trust, the Cash Custodian shall pay out cash of the Trust to purchase Shares.

Under the Cash Custody Agreement between State Street and the Trust,

State Street may act as custodian for the Trust’s non-bitcoin assets, if any, and as custodian for the Trust’s cash

(in such capacity, the “Cash Custodian”).

The Cash Custodian has agreed to, among other things, open and maintain a

separate deposit account or accounts of the Trust, to determine the amount of bitcoin and/or cash required for an issuance or redemption

of shares in a Basket and to release and deliver non-bitcoin assets and pay out cash.

The Cash Custodian shall credit to the deposit account(s) all cash

received by the Cash Custodian from or for the account of the Trust.

Upon an instruction to purchase Shares for the account of

the Trust, the Cash Custodian shall pay out cash

of the Trust to purchase Shares.

Upon an instruction to redeem Shares for the

2 unchanged sentences

The Bitcoin Custodian

Gemini Trust Company, LLC serves as the Trust’s Bitcoin

Custodian and is a fiduciary under § 100 of the New York Banking Law.

The Bitcoin Custodian is authorized to serve as the

Trust’s custodian under the Trust Agreement and pursuant to the terms and provisions of the agreement which establishes the

rights and responsibilities the Bitcoin Custodian, the Sponsor and the Trust with respect to the custody of the Trust’s bitcoin

(the “Custody Agreement”).

The Bitcoin Custodian has its principal office at 315 Park Ave South, Floor 16, New York,

The Bitcoin Custodian makes available to the Trust a custodial

account for bitcoin maintained by the Bitcoin Custodian (“Bitcoin Account”) and access to an omnibus custodial account

held at depository institutions or money market funds in the Bitcoin Custodian’s name for the benefit of its customers at

which a cash balance may be maintained (“Fiat Account”).

Gemini Trust Company, LLC serves as the Trust’s Bitcoin Custodian

and is a fiduciary under § 100 of the New York Banking Law.

The Bitcoin Custodian is authorized to serve as the Trust’s

custodian under the Trust Agreement and pursuant to the terms and provisions of the agreement which establishes the rights and

responsibilities the Bitcoin Custodian, the Sponsor and the Trust with respect to the custody of the Trust’s bitcoin (the

“Custody Agreement”).

The Bitcoin Custodian has its principal office at 315 Park Ave South, Floor 16, New York, NY

The Bitcoin Custodian makes available to the Trust a custodial account

for bitcoin maintained by the Bitcoin Custodian (“Bitcoin Account”) and access to an omnibus custodial account held

at depository institutions or money market funds in the Bitcoin Custodian’s name for the benefit of its customers at which

a cash balance may be maintained (“Fiat Account”).

The Bitcoin Custodian’s services in respect of the Bitcoin

5 unchanged sentences

for the benefit of the Bitcoin Custodian’s customers at depository institutions or money market funds.

The Sponsor may, in its sole discretion, add or terminate other

bitcoin custodians.

The Sponsor may, in its sole discretion, change the custodian for the Trust’s bitcoin holdings, but

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

To the extent that

the Sponsor adds or terminates other bitcoin custodians, or changes the custodian for the Trust’s bitcoin holdings, notification

will be made to Shareholders via a prospectus supplement and/or a current report filed with the SEC.

The Trust’s Bitcoin Custodian will keep custody of all

of the Trust’s bitcoin and will safeguard the private keys to the bitcoin associated with the Trust’s Bitcoin Account

and Clearing Account.

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

The Sponsor has executed an agreement with Coinbase Custody Trust Company (“Coinbase Custody”) that allows

Coinbase Custody to serve as an additional custodian for the Trust’s assets.

The Sponsor may, in its sole discretion, change the

custodian for the Trust’s bitcoin holdings, but it will have no obligation to do so or to seek any particular terms for the

Trust from other such custodians.

To the extent that the Sponsor adds or terminates other bitcoin custodians, or changes the custodian

for the Trust’s bitcoin holdings, notification will be made to Shareholders via a prospectus supplement and/or a current

report filed with the SEC.

The Trust’s Bitcoin Custodian will keep custody of all of the

Trust’s bitcoin and will safeguard the private keys to the bitcoin associated with the Trust’s Bitcoin Account and

Clearing Account.

Bitcoin private keys are stored in two different forms:

7 unchanged sentences

may be held in omnibus hot storage wallets.

The Bitcoin Custodian will use segregated cold storage bitcoin

addresses for the Trust’s Bitcoin Account, which is separate from the bitcoin addresses that the Bitcoin Custodian uses for

its other customers and which are directly verifiable via the bitcoin blockchain.

The Bitcoin Custodian will at all times record

and identify in its books and records that such bitcoins constitute the property of the Trust.

The Bitcoin Custodian will not loan,

hypothecate, pledge or otherwise encumber the Trust’s bitcoin, as applicable, without the Trust’s instruction, nor

will the Sponsor or any other entity or service provider.

The Trust will not lease or loan bitcoin held in the Trust’s account

with the Bitcoin Custodian and will not give instructions to that effect.

The Bitcoin Custodian will use segregated cold storage bitcoin addresses

for the Trust’s Bitcoin Account, which is separate from the bitcoin addresses that the Bitcoin Custodian uses for its other

customers and which are directly verifiable via the bitcoin blockchain.

The Bitcoin Custodian will at all times record and identify

in its books and records that such bitcoins constitute the property of the Trust.

The Bitcoin Custodian will not loan, hypothecate,

pledge or otherwise encumber the Trust’s bitcoin, as applicable, without the Trust’s instruction, nor will the Sponsor

or any other entity or service provider.

The Trust will not lease or loan bitcoin held in the Trust’s account with the Bitcoin

Custodian and will not give instructions to that effect.

In addition to the bitcoin custodial services in connection with

9 unchanged sentences

Bitcoin Custodian will make available to the Trust a clearing account (the “Clearing Account”).

The Trustee, a Delaware trust company, acts as the trustee of

the Trust for the purpose of creating a Delaware statutory trust in accordance with the Delaware Statutory Trust Act (“DSTA”).

The Additional Bitcoin Custodian

Coinbase Custody Trust Company, LLC, serves as the Trust’s

Additional Bitcoin Custodian and is a fiduciary under § 100 of the New York Banking Law and a qualified custodian for purposes

of Rule 206(4)-2(d)(6) under the Investment Advisers Act of 1940, as amended.

The Additional Bitcoin Custodian is authorized to

serve as the Trust’s custodian under the Trust Agreement and pursuant to the terms and provisions of the Additional Bitcoin

Custody Agreement.

The Additional Bitcoin Custodian has its principal address at 55 Hudson Yards, 550 West 34th Street, 4th Floor,

New York, NY 10001.

The Additional Bitcoin Custodian makes available to the Trust a custodial

account for bitcoin maintained by the Additional Bitcoin Custodian (the “Additional Bitcoin Account”).

The Additional

Bitcoin Custodian’s services in respect of the Additional Bitcoin Account (i) allow all or a portion of the Trust’s

bitcoin allocated to the vault balance (the “Additional Bitcoin Vault Balance”) to be held in the Additional Bitcoin

Account, (ii) allow bitcoin to be deposited from a public blockchain address to the Trust’s Additional Bitcoin Account, (iii)

allow bitcoin to be withdrawn from the Additional Bitcoin Account to a public blockchain address as instructed by the Trust and

(iv) certain additional services as may be agreed to between the Trust and the Additional Bitcoin Custodian from time to time.

The Trustee, a Delaware trust company, acts as the trustee of the

Trust for the purpose of creating a Delaware statutory trust in accordance with the Delaware Statutory Trust Act (“DSTA”).

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

2 unchanged sentences

The Trustee is a fiduciary under the Trust Agreement;

however, that the fiduciary duties and responsibilities and liabilities of the Trustee are limited by, and are only those specifically

set forth in, the Trust Agreement.

provided, however, that the fiduciary duties and responsibilities and liabilities of the Trustee are limited by, and are only those

specifically set forth in, the Trust Agreement.

Resignation, Discharge or Removal of Trustee;

Successor Trustees

The Trustee may resign upon at least 60 days’ prior written

notice to the Sponsor;

provided, however, that such resignation shall not be effective until such time as a successor Trustee has

accepted such appointment.

The Sponsor may remove the Trustee at any time upon 60 days’ prior written notice to the

The Trustee may resign upon at least 60 days’

prior written notice to the Sponsor;

provided, however, that such resignation shall not be effective until such time as a successor

Trustee has accepted such appointment.

The Sponsor may remove the Trustee at any time upon 60 days’ prior written notice

provided, however, that such removal shall not be effective

6 unchanged sentences

Any successor Trustee appointed pursuant to the Trust Agreement shall be eligible to

act in such capacity in accordance with this Trust Agreement and, following compliance with the Trust Agreement, shall become fully

act in such capacity in accordance with the Trust Agreement and, following compliance with the Trust Agreement, shall become fully

vested with the rights, powers, duties and obligations of its predecessor under the Trust Agreement, with like effect as if originally

8 unchanged sentences

State Street serves as the Trust’s Administrator.

Street’s principal address is One Congress Street, Boston, MA 02111.

Under the Trust’s Administration Agreement between

State Street and the Trust (the “Trust Administration Agreement”) and a separate cash custodian agreement, the Administrator

provides certain administrative and accounting services and financial reporting for the maintenance and operations of the Trust,

maintaining the books of account of the Trust, including calculating the NAV of the Trust and disseminating the NAV and other information

for accounting data or any information pertaining to the books and records maintained by the Administrator.

State Street’s

principal address is One Congress Street, Boston, MA 02111.

Under the Trust’s Administration Agreement between State Street

and the Trust (the “Trust Administration Agreement”) and a separate cash custodian agreement, the Administrator provides

certain administrative and accounting services and financial reporting for the maintenance and operations of the Trust, maintaining

the books of account of the Trust, including calculating the NAV of the Trust and disseminating the NAV and other information for

accounting data or any information pertaining to the books and records maintained by the Administrator.

In addition, the Administrator

6 unchanged sentences

State Street serves as the Transfer Agent for the Trust.

Transfer Agent:

(1) issues and redeems Shares of the Trust;

(2) responds to correspondence by Shareholders and others relating

to its duties;

(2) responds to correspondence by Shareholders and others relating to its duties;

(3) maintains Shareholder accounts;

and (4) makes periodic reports to the Trust.

The Trust’s Transfer Agent

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

The Trust’s Transfer Agent facilitates the

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

The Marketing Agent

Van Eck Securities Corporation (the “Marketing

Agent”), a wholly-owned subsidiary of VanEck, is responsible for:

(1) working with the Administrator to review and approve, or

reject, purchase and redemption orders of Baskets placed by Authorized Participants with the Administrator;

(2) providing assistance

in the marketing of the Shares;

(3) reviewing and approving the marketing materials prepared by the Sponsor for compliance with

applicable SEC and the Financial Industry Regulatory Authority (“FINRA”) advertising laws, rules and regulations;

(4) maintaining a public website on behalf of the Trust, containing information about the Trust and the Shares.

Van Eck Securities Corporation (the “Marketing Agent”),

a wholly-owned subsidiary of VanEck, is responsible for:

(1) working with the Administrator to review and approve, or reject, purchase

and redemption orders of Baskets placed by Authorized Participants with the Administrator;

(2) providing assistance in the marketing

of the Shares;

(3) reviewing and approving the marketing materials prepared by the Sponsor for compliance with applicable SEC and

the Financial Industry Regulatory Authority (“FINRA”) advertising laws, rules and regulations;

and (4) maintaining

a public website on behalf of the Trust, containing information about the Trust and the Shares.

The Trust’s Fees and Expenses

Effective as of March 12, 2024 and ending on March 31, 2025,

the Sponsor will waive the entire Sponsor Fee for the first $1.5 billion of the Trust’s assets.

If the Trust’s assets

exceed $1.5 billion prior to March 31, 2025, the Sponsor Fee charged on assets over $1.5 billion will be 0.20%.

All investors will

incur the same Sponsor Fee which is the weighted average of those fee rates.

After March 31, 2025, the Sponsor

Fee will be 0.20%.

The Sponsor Fee is paid by the Trust to the

Sponsor as compensation for services performed under the Trust Agreement.

The Administrator makes its determination regarding the

Sponsor Fee in respect of each day by reference to the Trust’s NAV as of that day.

The Sponsor Fee accrues in U.S.

and be payable monthly in arrears in bitcoin on, or by, the tenth business day of the next month in respect of the prior month.

Each month, the Administrator calculates the Sponsor Fee for each day of the month, resulting in a cumulative total in U.S.

which the Administrator then calculates the bitcoin equivalent of by reference to the Index as of the date of calculation, and

the Sponsor shall then withdraw the corresponding amount of bitcoin from the Trust’s Bitcoin Account in payment of the Sponsor

The Sponsor has agreed to pay all ordinary operating expenses (except for extraordinary expenses, including but not limited

to, non-recurring expenses and costs of services performed by the Sponsor or a service provider on behalf of the Trust to protect

the Trust or the interests of Shareholders, such as in connection with any indemnification of agents, service providers or counterparties

of the Trust and extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation,

The Trust pays the Sponsor a unified fee (the “Sponsor

Fee”) of 0.20% of average daily net assets that accrues daily and pays monthly.

Prior to February 21, 2024, the Sponsor Fee

was 0.25% of average daily net assets.

Effective for the period from March 12, 2024, through November 30, 2024, the Sponsor agreed

to waive the entire Sponsor Fee for the first $1.5 billion of the Trust’s net assets.

Effective for the period from November

25, 2024 through January 10, 2026, the Sponsor will waive the entire Sponsor Fee for the first $2.5 billion of the Trust’s

If the Trust’s assets exceed $2.5 billion prior to January 10, 2026, the Sponsor Fee charged on assets over $2.5

billion will be 0.20% of average daily net assets.

All investors will incur the same Sponsor Fee which is the weighted average of

those fee rates.

After January 10, 2026, the Sponsor Fee will be 0.20% of average daily net assets.The Sponsor Fee is paid by the

Trust to the Sponsor as compensation for services performed under the Trust Agreement.

The Administrator makes its determination

regarding the Sponsor Fee in respect of each day by reference to the Trust’s NAV as of that day.

The Sponsor Fee accrues in

dollars and is payable monthly in arrears in bitcoin on, or by, the tenth business day of the next month in respect of the

Each month, the Administrator calculates the Sponsor Fee for each day of the month, resulting in a cumulative total in

dollars, which the Administrator then calculates the bitcoin equivalent of by reference to the Index as of the date of

calculation, and the Sponsor shall then withdraw the corresponding amount of bitcoin from the Trust’s Bitcoin Account in

payment of the Sponsor Fee.

Sponsor has agreed to pay all ordinary operating expenses (except for extraordinary expenses, including but not limited to, non-recurring

expenses and costs of services performed by the Sponsor or a service provider on behalf of the Trust to protect the Trust or the

interests of Shareholders, such as in connection with any indemnification of agents, service providers or counterparties of the

Trust and extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation,

regulatory enforcement or investigation matters) out of the Sponsor Fee.

46 unchanged sentences

Report, that have agreed to serve as a Liquidity Provider and have consented to be named in the Trust’s registration statement

are JSCT, LLC, Nonco LLC and Cumberland DRW LLC.

are JSCT, LLC, Nonco LLC and Cumberland New York LLC.

Additional Liquidity Providers may be added at any time, subject

to the Sponsor’s sole discretion.

In the future, subject

to In-Kind Regulatory Approval, the Trust may elect to permit Authorized Participants to also deliver or direct the delivery of

bitcoin by third parties, or take delivery or direct the taking of delivery of bitcoin by third parties, in connection with in-kind

subscription or redemption transactions.

Based on the current price of bitcoin and corresponding size of the Baskets, the Sponsor

does not believe such size will have a material impact on the arbitrage mechanism.

In the future, subject to

In-Kind Regulatory Approval, the Trust may elect to permit Authorized Participants to also deliver or direct the delivery of bitcoin

by third parties, or take delivery or direct the taking of delivery of bitcoin by third parties, in connection with in-kind subscription

or redemption transactions.

Based on the current price of bitcoin and corresponding size of the Baskets, the Sponsor does not believe

such size will have a material impact on the arbitrage mechanism.

Authorized Participants

25 unchanged sentences

will seek or obtain In-Kind Regulatory Approval, if at all.

To become an Authorized Participant, a person must enter into

an agreement with the Sponsor and the Trustee that provides the procedures for the creation and redemption of Baskets (the “Authorized

To become an Authorized Participant, a person must enter into an

agreement with the Sponsor and the Trustee that provides the procedures for the creation and redemption of Baskets (the “Authorized

Participant Agreement”).

11 unchanged sentences

to the Sponsor or the Trust to effect any sale or resale of Shares.

Each Authorized Participant is required to be registered as a

broker-dealer under the Exchange Act and a member in good standing with FINRA, or exempt from being or otherwise not required to

be licensed as a broker-dealer or a member of FINRA, and qualified to act as a broker or dealer in the states or other jurisdictions

where the nature of its business so requires.

Certain Authorized Participants may also be regulated under federal and state banking

laws and regulations.

Each Authorized Participant is required to be registered as a broker-dealer

under the Exchange Act and a member in good standing with FINRA, or exempt from being or otherwise not required to be licensed

as a broker-dealer or a member of FINRA, and qualified to act as a broker or dealer in the states or other jurisdictions where

the nature of its business so requires.

Certain Authorized Participants may also be regulated under federal and state banking laws

and regulations.

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

as it determines is appropriate in light of its own regulatory regime.

As of the date of this Report, the Authorized Participants that

have consented to be named in the Trust’s registration statement are Jane Street Capital, LLC, Virtu Americas LLC, Macquarie Capital

As of the date of this Report, the Authorized Participants that have

consented to be named in the Trust’s registration statement are Jane Street Capital, LLC, Virtu Americas LLC, Macquarie Capital

Inc., and ABN

AMRO Clearing USA LLC.

Additional Authorized Participants may

be added at any time, subject to the Sponsor’s discretion.

The following description of the procedures for the creation

and redemption of Baskets is only a summary and a Shareholder should refer to the relevant provisions of the Trust Agreement and

the form of Authorized Participant Agreement for more detail.

The Trust Agreement and form of Authorized Participant Agreement

are incorporated by reference to this Report.

Authorized Participants will place orders through the Transfer

The Transfer Agent will coordinate with the Sponsor, who will in turn coordinate with the Trust’s Bitcoin Custodian

in order to facilitate settlement of the Shares and bitcoin.

The trading prices of many digital assets, including bitcoin,

have experienced extreme volatility in recent periods and may continue to do so.

Extreme volatility may persist and the value of

the Shares may significantly decline in the future without recovery.

The digital asset markets may still be experiencing a bubble

or may experience a bubble again in the future.

Extreme volatility in the future, including further declines in the trading prices

of bitcoin, could have a material adverse effect on the value of the Shares and the Shares could lose all or substantially all

of their value.

The Trust is not actively managed and will not take any actions to take advantage, or mitigate the impacts, of

volatility in the price of bitcoin.

Additional Authorized Participants may be

added at any time, subject to the Sponsor’s discretion.

The following description of the procedures for the creation and

redemption of Baskets is only a summary and a Shareholder should refer to the relevant provisions of the Trust Agreement and the

form of Authorized Participant Agreement for more detail.

The Trust Agreement and form of Authorized Participant Agreement are

incorporated by reference to this Report.

Authorized Participants will place orders through the Transfer Agent.

The Transfer Agent will coordinate with the Sponsor, who will in turn coordinate with the Trust’s Bitcoin Custodian in order

to facilitate settlement of the Shares and bitcoin.

The trading prices of many digital assets, including bitcoin, have

experienced extreme volatility in recent periods and may continue to do so.

Extreme volatility may persist and the value of the

Shares may significantly decline in the future without recovery.

The digital asset markets may be experiencing a bubble or may

experience a bubble again in the future.

Extreme volatility in the future, including further declines in the trading prices of

bitcoin, could have a material adverse effect on the value of the Shares and the Shares could lose all or substantially all of

The Trust is not actively managed and will not take any actions to take advantage, or mitigate the impacts, of volatility

in the price of bitcoin.

In addition, the use of cash creations and redemptions has transaction

33 unchanged sentences

If an Authorized Participant fails to consummate the foregoing, the order will be cancelled.

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 Trust, 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

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 Trust, 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 is received.

date for a purchase order, following receipt of the purchase

order from the Authorized Participant, the Trust shall, in its sole discretion, select a Liquidity Provider and execute a trade

to purchase bitcoin from that Liquidity Provider in the amount of the total deposit required to create each Basket (“Basket

Deposit”), with the purchased bitcoin to be delivered by the Liquidity Provider on the settlement date for a purchase order

(which shall be the Business Day immediately following the trade date unless the Trust, Sponsor, Authorized Participant agree to

a different date) (the “Creation Settlement Date”) in exchange for a cash price to be delivered by the Trust on Creation

Settlement Date.

date for a purchase order, following receipt of the purchase order

from the Authorized Participant, the Trust shall, in its sole discretion, select a Liquidity Provider and execute a trade to purchase

bitcoin from that Liquidity Provider in the amount of the total deposit required to create each Basket (“Basket Deposit”),

with the purchased bitcoin to be delivered by the Liquidity Provider on the settlement date for a purchase order (which shall be

the Business Day immediately following the trade date unless the Trust, Sponsor, Authorized Participant agree to a different date)

(the “Creation Settlement Date”) in exchange for a cash price to be delivered by the Trust on Creation Settlement Date.

The Liquidity Provider, not the Authorized Participant, shall be responsible for delivering bitcoin to the Trust.

Subject to In-Kind Regulatory Approval, of which there can be

no assurance that such approval will ever be obtained following an Authorized Participant’s purchase order, the Trust’s

Subject to In-Kind Regulatory Approval, of which there can be no

assurance that such approval will ever be obtained following an Authorized Participant’s purchase order, the Trust’s

Bitcoin Custodian account must be credited with the required bitcoin by the end of the business day following the purchase order

1 unchanged sentence

the purchase order date, as applicable.

Upon receipt of the bitcoin deposit amount in the Trust’s Bitcoin Custodian account,

or the cash deposit amount in the Trust’s Cash Custodian account, the Bitcoin Custodian or Cash Custodian, respectively,

will notify the Transfer Agent, the Authorized Participant, and the Sponsor that the bitcoin or cash has been deposited.

Agent will then direct DTC to credit the number of Shares created to the applicable DTC account.

No Shares will be issued unless and until the 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

Upon receipt of the bitcoin deposit amount in the Trust’s Bitcoin Account, or the

cash deposit amount in the Trust’s Cash Custodian account, the Bitcoin Custodian or Cash Custodian, respectively, will notify

the Transfer Agent, the Authorized Participant, 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 DTC account.

No Shares will be issued unless and until the 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.

6 unchanged sentences

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 in until such transfers can occur.

Bitcoin held in the Trust’s Bitcoin Custodian account is

the property of the Trust and is not leased, or loaned under any circumstances.

cold storage until such transfers can occur.

Bitcoin held in the Trust’s Bitcoin Custodian account is the

property of the Trust and is not leased, or loaned under any circumstances.

Determination of Required Deposits

25 unchanged sentences

Component, the Cash Amount, and the Purchase Slippage, the “Required

Cash Creation Total”) , which the Authorized Participant shall be responsible for delivering in cash on the “Creation

Settlement Date to the Trust’s account at the Cash Custodian bitcoin in cleared, immediately available funds by 1:00 p.m.

The Trust acknowledges that, if the actual cash purchase price of bitcoin from the Liquidity Provider is below the Basket Cash

Component, the Authorized Participant shall be entitled to retain the difference and the Required Cash Creation Total shall be

reduced accordingly.

Cash Creation Total”), which the Authorized Participant shall be responsible for delivering in cash on the Creation Settlement

Date to the Trust’s account at the Cash Custodian bitcoin in cleared, immediately available funds by 1:00 p.m.

acknowledges that, if the actual cash purchase price of bitcoin from the Liquidity Provider is below the Basket Cash Component,

the Authorized Participant shall be entitled to retain the difference and the Required Cash Creation Total shall be reduced accordingly.

Delivery of Required Deposits

On the Creation Settlement Date, the Authorized Participant who

places a purchase order must follow the procedures outlined in the “Creation Procedures” section of this Report.

Trust shall instruct the Cash Custodian to transfer the cash proceeds to the Trust’s Fiat Account.

The Liquidity Provider

delivers bitcoin to the Trust’s Clearing Account in exchange for the cash purchase price, a delivery facilitated by the Bitcoin

Custodian under the Clearing Agreement.

Upon settlement by the Bitcoin Custodian, in its capacity as the provider of Clearing Services

pursuant to the Clearing Agreement, of the bitcoin purchase from the Liquidity Provider and the deposit of bitcoin in the Trust’s

On the Creation Settlement Date, the Authorized Participant who places

a purchase order must follow the procedures outlined in the “Creation Procedures” section of this Report.

shall instruct the Cash Custodian to transfer the cash proceeds to the Trust’s Fiat Account.

The Liquidity Provider delivers

bitcoin to the Trust’s Clearing Account in exchange for the cash purchase price, a delivery facilitated by the Bitcoin Custodian

under the Clearing Agreement.

Upon settlement by the Bitcoin Custodian, in its capacity as the provider of Clearing Services pursuant

to the Clearing Agreement, of the bitcoin purchase from the Liquidity Provider and the deposit of bitcoin in the Trust’s

Clearing Account, the Trust instructs the Transfer Agent to release the Shares to the Authorized Participant, and the Transfer

9 unchanged sentences

Rejection of Purchase Orders

The Sponsor or its designee has the absolute right, but does

not have any obligation, to reject any purchase order or Basket Deposit if the Sponsor determines that:

The Sponsor or its designee has the absolute right, but does not

have any obligation, to reject any purchase order or Basket Deposit if the Sponsor determines that:

the purchase order or Basket Deposit is not in proper form;

1 unchanged sentence

the acceptance of the purchase order or the Basket Deposit would have adverse tax consequences to the Trust or its Shareholders;

● the acceptance or receipt of the purchase order or the Basket Deposit would, in the opinion of counsel to the Sponsor, be unlawful;

the acceptance or receipt of the purchase order or the Basket Deposit would, in the opinion of counsel to the Sponsor,

circumstances outside the control of the Trust, the Sponsor, the Marketing Agent or the Bitcoin Custodian or Cash Custodian

make it, for all practical purposes impracticable or not feasible to process Baskets (including if the Sponsor determines that

the investments available to the Trust at that time will not enable it to meet its investment objective).

None of the Sponsor, the Transfer Agent, the Bitcoin Custodian

or the Cash Custodian will be liable for the rejection of any purchase order or Basket Deposit.

make it, for all practical purposes impracticable or not feasible to process Baskets (including if the Sponsor determines

that the investments available to the Trust at that time will not enable it to meet its investment objective).

None of the Sponsor, the Transfer Agent, the Bitcoin Custodian or

the Cash Custodian will be liable for the rejection of any purchase order or Basket Deposit.

Redemption Procedures

The procedures by which an Authorized Participant can redeem

one or more Baskets mirror the procedures for the creation of Baskets with an additional safeguard on bitcoin or cash being removed

The procedures by which an Authorized Participant can redeem one

or more Baskets mirror the procedures for the creation of Baskets with an additional safeguard on bitcoin or cash being removed

from the Trust’s Bitcoin Custodian or Cash Custodian account.

9 unchanged sentences

by the Transfer Agent (“Redemption Order Date”).

On the business day on which any order redeeming Baskets of the

Trust is placed (the “Redemption Trade Date”), following receipt of the redemption order from the Authorized Participant,

On the business day on which any order redeeming Baskets of the Trust

is placed (the “Redemption Trade Date”), following receipt of the redemption order from the Authorized Participant,

the Trust shall instruct the Bitcoin Custodian to move the bitcoin in the amount of the Basket Deposit out of the Trust’s

6 unchanged sentences

as of the date of this Report, that have agreed to serve as a Liquidity Provider and have consented to be named in the Trust’s

registration statement are JSCT, LLC, Nonco LLC and Cumberland DRW LLC.

Additional Liquidity Providers may be added at any time,

subject to the Sponsor’s sole discretion.

The Redemption Settlement Date shall be the immediately following Business Day

after the Redemption Trade Date unless the parties otherwise agree in writing.

registration statement are JSCT, LLC, Nonco LLC and Cumberland New York LLC.

Additional Liquidity Providers may be added at any

time, subject to the Sponsor’s sole discretion.

The Redemption Settlement Date shall be the immediately following Business

Day after the Redemption Trade Date unless the parties otherwise agree in writing.

The Liquidity Provider, not the Authorized Participant,

2 unchanged sentences

facilitate the delivery of the Basket of Shares.

Once the Transfer Agent notifies the Bitcoin Custodian or Cash

Custodian (as applicable), the Sponsor and the Administrator that the Shares have been received in the Trust’s DTC account,

the Administrator instructs the Bitcoin Custodian or Cash Custodian (as applicable) to transfer the redemption bitcoin or cash

amount from the Trust’s Bitcoin Custodian or Cash Custodian account to the Authorized Participant.

Bitcoin held in the Trust’s Bitcoin Custodian account is

the property of the Trust and is not leased, or loaned under any circumstances.

Once the Transfer Agent notifies the Bitcoin Custodian or Cash Custodian

(as applicable), the Sponsor and the Administrator that the Shares have been received in the Trust’s DTC account, the Administrator

instructs the Bitcoin Custodian or Cash Custodian (as applicable) to transfer the redemption bitcoin or cash amount from the Trust’s

Bitcoin Custodian or Cash Custodian account to the Authorized Participant.

Bitcoin held in the Trust’s Bitcoin Account is the property

of the Trust and is not leased, or loaned under any circumstances.

Determination of Redemption Distribution

ET (or such other time as the parties may agree)

on the Redemption Trade Date, the Administrator will calculate and transmit (1) Basket Cash Component, minus (2) the Cash Amount,

ET (or such other time as the parties may agree) on

the Redemption Trade Date, the Administrator will calculate and transmit (1) Basket Cash Component, minus (2) the Cash Amount,

and minus (3) any amount by which the actual cash sale price of the bitcoin to the Liquidity Provider is less than the adjusted

19 unchanged sentences

the associated Shares and will not receive any cash, or the Sponsor may use an

alternative execution method for the Trust to sell bitcoin, in

which case the Authorized Participant agrees and acknowledges it is responsible for any Redemption Slippage and Cash Amount relating

alternative execution method for the Trust to sell bitcoin, in which

case the Authorized Participant agrees and acknowledges it is responsible for any Redemption Slippage and Cash Amount relating

to such alternative execution method.

26 unchanged sentences

Redemption orders must be made in whole Baskets.

acting by itself or through the person authorized to take redemption orders in the manner provided in the Authorized Participant

Agreement may, in its sole discretion, reject any redemption order (1) the Sponsor determines not to be in proper form, (2) the

fulfillment of which its counsel advises may be illegal under applicable laws and regulations, or (3) if circumstances outside

the control of the Sponsor, the person authorized to take redemption orders in the manner provided in the Authorized Participant

Agreement or the Bitcoin Custodian make it for all practical purposes not feasible for the Shares to be delivered under the redemption

The Sponsor may also reject a redemption order if the number of Shares being redeemed would reduce the remaining outstanding

Shares to 25,000 Shares (i.e., 1 Basket) or less.

The Marketing Agent shall notify the Authorized Participant of

a rejection or suspension of any redemption order.

The Sponsor acting

by itself or through the person authorized to take redemption orders in the manner provided in the Authorized Participant Agreement

may, in its sole discretion, reject any redemption order (1) the Sponsor determines not to be in proper form, (2) the fulfillment

of which its counsel advises may be illegal under applicable laws and regulations, or (3) if circumstances outside the control

of the Sponsor, the person authorized to take redemption orders in the manner provided in the Authorized Participant Agreement

or the Bitcoin Custodian make it for all practical purposes not feasible for the Shares to be delivered under the redemption order.

The Sponsor may also reject a redemption order if the number of Shares being redeemed would reduce the remaining outstanding Shares

to 25,000 Shares (i.e., 1 Basket) or less.

The Marketing Agent shall notify the Authorized Participant of a

rejection or suspension of any redemption order.

The Marketing Agent is under no duty, however, to give notification of any specific

10 unchanged sentences

Tax Responsibility

Authorized Participants are responsible

for any transfer tax, sales or use tax, stamp tax, recording tax, value added tax or similar tax or governmental charge applicable

Authorized Participants 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

3 unchanged sentences

The following discussion of the material U.S.

federal income

tax consequences that generally will apply to the purchase, ownership and disposition of Shares by a U.S.

Shareholder (as defined

below) represents, insofar as it describes conclusions as to U.S.

federal income tax

consequences that generally will apply to the purchase, ownership and disposition of Shares by a U.S.

Shareholder (as defined below)

represents, insofar as it describes conclusions as to U.S.

federal income tax law and subject to the limitations and qualifications

17 unchanged sentences

federal income tax purposes to accelerate the recognition of any item of gross income with respect to the Shares

as a result of such income being recognized on an applicable financial statement, Shareholders who do not acquire their Shares

solely for cash, or other investors with special circumstances) may be subject to special rules not discussed below.

the following discussion applies only to investors who will hold Shares as “capital assets” (generally, property held

for investment).

Moreover, the discussion below does not address the effect of any state, local or foreign tax law consequences

(or any consequences under any U.S.

as a result of such income being recognized on an applicable financial statement, or other investors with special circumstances)

may be subject to special rules not discussed below.

In addition, the following discussion applies only to investors who will hold

Shares as “capital assets” (generally, property held for investment).

Moreover, the discussion below does not address

the effect of any state, local or foreign tax law consequences (or any consequences under any U.S.

federal tax law other than U.S.

federal income tax law) that may apply to an investment in

Purchasers of Shares are urged to consult their own tax advisers with respect to all U.S.

federal, state, local and foreign

tax law considerations potentially applicable to their investment in Shares.

federal income tax law) that may apply to an investment in Shares.

Purchasers of Shares are urged to consult their own tax advisers

with respect to all U.S.

federal, state, local and foreign tax law considerations potentially applicable to their investment in

For purposes of this discussion, a “U.S.

3 unchanged sentences

a corporation (or entity treated as a corporation for U.S.

federal income tax purposes) created or organized in or under the

laws of the United States, any state thereof or the District of Columbia;

federal income tax purposes) created or organized in or under

the laws of the United States, any state thereof or the District of Columbia;

an estate, the income of which is includible in gross income for U.S.

federal income tax purposes regardless of its source;

● a trust, if a court within the United States is able to exercise primary supervision over the administration of the trust and

one or more United States persons have the authority to control all substantial decisions of the trust.

If a partnership or other entity or arrangement treated as a

partnership for U.S.

federal income tax purposes holds Shares, the tax treatment of a partner generally depends upon the status

of the partner and the activities of the partnership.

If you are a partner of a partnership holding Shares, the discussion below

may not be applicable and we urge you to consult your own tax adviser for the U.S.

federal income tax implications of the purchase,

ownership and disposition of such Shares.

a trust, if a court within the United States is able to exercise primary supervision over the administration of the trust

and one or more United States persons have the authority to control all substantial decisions of the trust.

If a partnership or other entity or arrangement treated as a partnership

federal income tax purposes holds Shares, the tax treatment of a partner generally depends upon the status of the partner

and the activities of the partnership.

If you are a partner of a partnership holding Shares, the discussion below may not be applicable

and we urge you to consult your own tax adviser for the U.S.

federal income tax implications of the purchase, ownership and disposition

of such Shares.

Taxation of the Trust

25 unchanged sentences

Trust would be taxed to Shareholders as ordinary dividend income.

However, due to the uncertain treatment of digital currency for

However, due to the uncertain treatment of digital assets for

federal income tax purposes, there can be no assurance in this regard.

10 unchanged sentences

In the case of a Shareholder that acquires its Shares as part of the

creation of a Basket, the delivery of bitcoin to the Trust in exchange for a pro rata share of the underlying bitcoin represented

by the Shares will not be a taxable event to the Shareholder, and the Shareholder’s tax basis and holding period for the

Shareholder’s pro rata share of the bitcoin held in the Trust will be the same as its tax basis and holding period for the

bitcoin delivered in exchange therefor.

For purposes of this discussion, and unless stated otherwise, it is assumed that all of

a Shareholder’s Shares are acquired on the same date and at the same price per Share.

Shareholders that hold multiple lots

of Shares, or that are contemplating acquiring multiple lots of Shares, should consult their own tax advisers as to the determination

of the tax basis and holding period for the underlying bitcoin related to such Shares.

Current IRS guidance on the treatment of convertible virtual

currencies classifies bitcoin as “property” that is not currency for U.S.

federal income tax purposes and clarifies

that bitcoin could be held as a capital asset, but it does not address several other aspects of the U.S.

federal income tax treatment

creation of a Basket (if In-Kind Regulatory Approval is obtained), the delivery of bitcoin to the Trust in exchange for a pro rata

share of the underlying bitcoin represented by the Shares will not be a taxable event to the Shareholder, and the Shareholder’s

tax basis and holding period for the Shareholder’s pro rata share of the bitcoin held in the Trust will be the same as its

tax basis and holding period for the bitcoin delivered in exchange therefor.

For purposes of this discussion, and unless stated

otherwise, it is assumed that all of a Shareholder’s Shares are acquired on the same date and at the same price per Share.

Shareholders that hold multiple lots of Shares, or that are contemplating acquiring multiple lots of Shares, should consult their

own tax advisers as to the determination of the tax basis and holding period for the underlying bitcoin related to such Shares.

Current IRS guidance on the treatment of convertible virtual currencies

classifies bitcoin as “property” that is not currency for U.S.

federal income tax purposes and clarifies that bitcoin

could be held as a capital asset, but it does not address several other aspects of the U.S.

federal income tax treatment of bitcoin.

Because bitcoin is a new technological innovation, the U.S.

federal income tax treatment of bitcoin or transactions

relating to investments in bitcoin may evolve and change from those discussed below, possibly with retroactive effect.

regard, the IRS indicated that it has made it a priority to issue additional guidance related to the taxation of virtual currency

transactions, such as transactions involving bitcoin.

While it has started to issue such additional guidance, whether any future

guidance will adversely affect the U.S.

federal income tax treatment of an investment in bitcoin or in transactions relating to

investments in bitcoin is unknown.

Moreover, future developments that may arise with respect to digital currencies may increase

the uncertainty with respect to the treatment of digital currencies for U.S.

federal income tax treatment of bitcoin or transactions relating to

investments in bitcoin may evolve and change from those discussed below, possibly with retroactive effect.

In this regard, the

IRS indicated that it has made it a priority to issue additional guidance related to the taxation of virtual asset transactions,

such as transactions involving bitcoin.

While it has started to issue such additional guidance, whether any future guidance will

adversely affect the U.S.

federal income tax treatment of an investment in bitcoin or in transactions relating to investments in

bitcoin is unknown.

Moreover, future developments that may arise with respect to digital assets may increase the uncertainty with

respect to the treatment of digital assets for U.S.

federal income tax purposes.

This discussion assumes

that any bitcoin the Trust may hold is properly treated for U.S.

federal income tax purposes as property that may be held as a

capital asset and is not currency for purposes of the provisions of the Code relating to foreign currency gain and loss.

Although the Trust generally does not intend to sell bitcoin,

it may use bitcoin to pay certain expenses of the Trust, which under current IRS guidance will be treated as a sale of such bitcoin,

This discussion assumes that any bitcoin the Trust

may hold is properly treated for U.S.

federal income tax purposes as property that may be held as a capital asset and is not currency

for purposes of the provisions of the Code relating to foreign currency gain and loss.

Although the Trust generally does not intend to sell bitcoin, it

may use bitcoin to pay certain expenses of the Trust, which under current IRS guidance will be treated as a sale of such bitcoin,

and/or it may

periodically sell bitcoin in an amount sufficient to pay those

expenses using fiat currency.

If the Trust sells bitcoin (for example to generate cash to pay fees or expenses) or is treated as

selling bitcoin (for example by using bitcoin to pay fees or expenses), a Shareholder will recognize gain or loss in an amount

equal to the difference between (a) the Shareholder’s pro rata share of the amount realized by the Trust upon the sale and

(b) the Shareholder’s tax basis for its pro rata share of the bitcoin that was sold.

A Shareholder’s tax basis for

its share of any bitcoin sold by the Trust should generally be determined by multiplying the Shareholder’s total basis for

its share of all of the bitcoin held in the Trust immediately prior to the sale, by a fraction the numerator of which is the amount

of bitcoin sold, and the denominator of which is the total amount of the bitcoin held in the Trust immediately prior to the sale.

After any such sale, a Shareholder’s tax basis for its pro rata share of the bitcoin remaining in the Trust should be equal

to its tax basis for its share of the total amount of the bitcoin held in the Trust immediately prior to the sale, less the portion

of such basis allocable to its share of the bitcoin that was sold.

Upon a Shareholder’s sale of some or all of its Shares

(other than a redemption), the Shareholder will be treated as having sold the portion or all, respectively, of its pro rata share

of the bitcoin held in the Trust at the time of the sale that is attributable to the Shares sold.

Accordingly, the Shareholder

generally will recognize gain or loss on the sale in an amount equal to the difference between (a) the amount realized pursuant

to the sale of the Shares, and (b) the Shareholder’s tax basis for the portion of its pro rata share of the bitcoin held

in the Trust at the time of sale that is attributable to the Shares sold, as determined in the manner described in the preceding

Based on current IRS guidance, such gain or loss (as well as any gain or loss realized by a Shareholder on account of

the Trust selling bitcoin) will generally be long-term or short-term capital gain or loss, depending upon whether the Shareholder

has a holding period of greater than one year in its pro rata share of the bitcoin that was sold.

The Trust plans to treat a redemption

of a some or all of a Shareholder’s Shares, in exchange for cash, in the same manner as a sale of some or all of a Shareholder’s

periodically sell bitcoin in an amount sufficient to pay those expenses

using fiat currency.

If the Trust sells bitcoin (for example to generate cash to pay fees or expenses) or is treated as selling

bitcoin (for example by using bitcoin to pay fees or expenses), a Shareholder will recognize gain or loss in an amount equal to

the difference between (a) the Shareholder’s pro rata share of the amount realized by the Trust upon the sale and (b) the

Shareholder’s tax basis for its pro rata share of the bitcoin that was sold.

A Shareholder’s tax basis for its share

of any bitcoin sold by the Trust should generally be determined by multiplying the Shareholder’s total basis for its share

of all of the bitcoin held in the Trust immediately prior to the sale, by a fraction the numerator of which is the amount of bitcoin

sold, and the denominator of which is the total amount of the bitcoin held in the Trust immediately prior to the sale.

such sale, a Shareholder’s tax basis for its pro rata share of the bitcoin remaining in the Trust should be equal to its

tax basis for its share of the total amount of the bitcoin held in the Trust immediately prior to the sale, less the portion of

such basis allocable to its share of the bitcoin that was sold.

Upon a Shareholder’s sale of some or all of its Shares (other

than a redemption), the Shareholder will be treated as having sold the portion or all, respectively, of its pro rata share of the

bitcoin held in the Trust at the time of the sale that is attributable to the Shares sold.

Accordingly, the Shareholder generally

will recognize gain or loss on the sale in an amount equal to the difference between (a) the amount realized pursuant to the sale

of the Shares, and (b) the Shareholder’s tax basis for the portion of its pro rata share of the bitcoin held in the Trust

at the time of sale that is attributable to the Shares sold, as determined in the manner described in the preceding paragraph.

Based on current IRS guidance, such gain or loss (as well as any gain or loss realized by a Shareholder on account of the Trust

selling bitcoin) will generally be long-term or short-term capital gain or loss, depending upon whether the Shareholder has a holding

period of greater than one year in its pro rata share of the bitcoin that was sold.

The Trust plans to treat a redemption of a

some or all of a Shareholder’s Shares, in exchange for cash, in the same manner as a sale of some or all of a Shareholder’s

Shares (as described above) for that amount of cash, though no assurance can be provided that the IRS will not take a different

6 unchanged sentences

Shares in exchange for the cash received from such sale is not expected to be treated as a separate taxable event to the Shareholder.

An in-kind redemption of some or all of a Shareholder’s

Shares in exchange for the underlying bitcoin represented by the Shares redeemed generally will not be a taxable event to the Shareholder.

An in-kind redemption of some or all of a Shareholder’s Shares

in exchange for the underlying bitcoin represented by the Shares redeemed generally will not be a taxable event to the Shareholder.

The Shareholder’s tax basis for the bitcoin received in the in-kind redemption generally will be the same as the Shareholder’s

25 unchanged sentences

all situations in which airdrops occur, it is clear from the reasoning of the IRS’s current guidance that it generally would

treat an airdrop as a taxable event giving rise to ordinary income.

The Sponsor has committed to cause the Trust to irrevocably

abandon any rights to acquire, or otherwise establish dominion and control over, any virtual currency or other asset or right,

other than bitcoin, which rights are incident to the Trust’s ownership of bitcoin and arise without any action of the Trust,

or of the Sponsor or Trustee on behalf of the Trust (“Incidental Rights”) and any such virtual currency acquired through

an Incidental Right as “IR Virtual Currency” to which the Trust may become entitled in the future.

However, there can

be no assurance that these abandonments would be treated as effective for U.S.

federal income tax purposes, or that the Sponsor

will continue to cause the Trust to irrevocably abandon any Incidental Rights and IR Virtual Currency if there are future regulatory

developments that would make it feasible for the Trust to retain those assets.

treat an airdrop as a taxable event giving rise to ordinary income and it is anticipated that any gain or loss from disposition

of any assets received in the airdrop would generally be treated as giving rise to capital gain or loss that generally would be

short-term capital gain or loss, unless the holding period of those assets were treated as being greater than one year as of the

time they are sold.

However, the Sponsor has committed to cause the Trust to irrevocably abandon any rights to acquire, or otherwise

establish dominion and control over, any virtual currency or other asset or right, other than bitcoin, which rights are incident

to the Trust’s ownership of bitcoin and arise without any action of the Trust, or of the Sponsor or Trustee on behalf of

the Trust (“Incidental Rights”) and any such virtual currency acquired through an Incidental Right as “IR Virtual

Currency” to which the Trust may become entitled in the future.There can be no assurance that these abandonments would be

treated as effective for U.S.

federal income tax purposes, or that the Sponsor will continue to cause the Trust to irrevocably

abandon any Incidental Rights and IR Virtual Currency if there are future regulatory developments that would make it feasible for

the Trust to retain those assets.

3.8% Tax on Net Investment Income

Shareholders who are individuals are required to

pay a 3.8% tax on the lesser of the excess of their modified adjusted gross income over a threshold amount ($250,000 for married

persons filing jointly and $200,000 for single taxpayers) or their “net investment income,” which generally includes

capital gains from the disposition of property.

Shareholders who are individuals are required to pay

a 3.8% tax on the lesser of the excess of their modified adjusted gross income over a threshold amount ($250,000 for married persons

filing jointly and $200,000 for single taxpayers) or their “net investment income,” which generally includes capital

gains from the disposition of property.

This tax is in addition to any capital gains taxes due on such investment income.

A similar tax applies to estates and trusts.

Shareholders should consult their own tax advisers regarding the effect, if any,

this tax may have on their investment in the Shares.

tax applies to estates and trusts.

Shareholders should consult their own tax advisers regarding the effect, if any, this tax

may have on their investment in the Shares.

Brokerage Fees and Trust Expenses

2 unchanged sentences

any brokerage fee incurred by a Shareholder in selling Shares will reduce the amount realized by the Shareholder with respect to

Shareholders will be required to recognize the full amount of

gain or loss upon a sale or deemed sale of bitcoin by the Trust (as discussed above), even though some or all of the proceeds of

such sale are used by the Trustee to pay Trust expenses.

Shareholders may deduct their respective pro rata shares of each expense

incurred by the Trust to the same extent as if they directly incurred the expense.

Shareholders who are individuals, estates or

trusts, however, may be required to treat some or all of the expenses of the Trust as miscellaneous itemized deductions.

Shareholders will be required to recognize the full amount of gain

or loss upon a sale or deemed sale of bitcoin by the Trust (as discussed above), even though some or all of the proceeds of such

sale are used by the Trustee to pay Trust expenses.

Shareholders may deduct their respective pro rata shares of each expense incurred

by the Trust to the same extent as if they directly incurred the expense.

Shareholders who are individuals, estates or trusts,

however, may be required to treat some or all of the expenses of the Trust as miscellaneous itemized deductions.

An individual

12 unchanged sentences

United States Information Reporting and Backup Withholding

The Trustee will file certain information returns with the IRS,

and provide certain tax-related information to Shareholders, in connection with the Trust.

To the extent required by applicable

regulations, each Shareholder will be provided with information regarding its allocable portion of the Trust’s annual income,

The Trustee will file certain information returns with the IRS, and

provide certain tax-related information to Shareholders, in connection with the Trust.

To the extent required by applicable regulations,

each Shareholder will be provided with information regarding its allocable portion of the Trust’s annual income,

expenses, gains and losses (if any).

Shareholder may be

subject to United States backup withholding tax in certain circumstances unless it provides its taxpayer identification number

and complies with certain certification procedures.

Shareholders may be required to meet certain information reporting or certification

requirements imposed by the Foreign Account Tax Compliance Act, in order to avoid certain information reporting and withholding

tax requirements.

Shareholder may be subject

to United States backup withholding tax in certain circumstances unless it provides its taxpayer identification number and complies

with certain certification procedures.

Shareholders may be required to meet certain information reporting or certification requirements

imposed by the Foreign Account Tax Compliance Act, in order to avoid certain information reporting and withholding tax requirements.

The amount of any backup withholding will be allowed as a credit

2 unchanged sentences

required information is furnished to the IRS in a timely manner.

Individual U.S.

Shareholders will generally be required to report

on their federal income tax return the receipt, acquisition, sale, or exchange of any financial interest in virtual currency, which

includes a Shareholder’s interest in bitcoin held by the Trust.

Taxation in Jurisdictions Other Than the United States

21 unchanged sentences

of ERISA, certain “church plans” within the meaning of Section 3(33) of ERISA and “non-U.S.

described in Section 4(b)(4) of ERISA, while not subject to the fiduciary responsibility and prohibited transaction provisions

of Title I of ERISA or Section 4975 of the Code, may be subject to any federal, state, local, non-U.S.

or other law or regulation

that is substantially similar to the foregoing provisions of ERISA and the Code.

Fiduciaries of any such plans are advised to consult

with their counsel prior to an investment in the Shares.

In contemplating an investment of a portion of Plan assets in

the Shares, the Plan fiduciary responsible for making such investment should carefully consider, taking into account the facts

and circumstances of the Plan, the “Risk Factors” discussed above and whether such investment is consistent with its

fiduciary responsibilities.

plans” described

in Section 4(b)(4) of ERISA, while not subject to the fiduciary responsibility and prohibited transaction provisions of Title I

of ERISA or Section 4975 of the Code, may be subject to any federal, state, local, non-U.S.

or other law or regulation that is

substantially similar to the foregoing provisions of ERISA and the Code.

Fiduciaries of any such plans are advised to consult with

their counsel prior to an investment in the Shares.

In contemplating an investment of a portion of Plan assets in the

Shares, the Plan fiduciary responsible for making such investment should carefully consider, taking into account the facts and

circumstances of the Plan, the “Risk Factors” discussed above and whether such investment is consistent with its fiduciary

responsibilities.

The Plan fiduciary should consider, among other issues, whether:

(1) the fiduciary has the authority

to make the investment under the appropriate governing plan instrument;

(2) the investment would constitute a direct or indirect

non-exempt prohibited transaction with a “party in interest” or “disqualified person” within the meaning

of ERISA and Section 4975 of the Code respectively;

(1) the fiduciary has the authority to make

the investment under the appropriate governing plan instrument;

(2) the investment would constitute a direct or indirect non-exempt

prohibited transaction with a “party in interest” or “disqualified person” within the meaning of ERISA

and Section 4975 of the Code respectively;

(3) the investment is in accordance with the Plan’s funding objectives;

and (4) such investment is appropriate for the Plan under the general fiduciary standards of investment prudence and diversification,

taking into account the overall investment policy of the Plan, the composition of the Plan’s investment portfolio and the

Plan’s need for sufficient liquidity to pay benefits when due.

When evaluating the prudence of an investment in the Shares,

the Plan fiduciary should consider the DOL’s regulation on investment duties, which can be found at 29 C.F.R.

such investment is appropriate for the Plan under the general fiduciary standards of investment prudence and diversification, taking

into account the overall investment policy of the Plan, the composition of the Plan’s investment portfolio and the Plan’s

need for sufficient liquidity to pay benefits when due.

When evaluating the prudence of an investment in the Shares, the Plan fiduciary

should consider the DOL’s regulation on investment duties, which can be found at 29 C.F.R.

§ 2550.404a-1.

It is intended that:

(a) none of the Sponsor, the Trustee, the

Bitcoin Custodian, the Cash Custodian or any of their respective affiliates (the “Transaction Parties”) has through

this Report and related materials provided any investment advice within the meaning of Section 3(21) of ERISA to the Plan in connection

with the decision to purchase or acquire such Shares;

and (b) the information provided in this Report and related materials will

not make a Transaction Party a fiduciary to the Plan.

(a) none of the Sponsor, the Trustee, the Bitcoin

Custodian, the Cash Custodian or any of their respective affiliates (the “Transaction Parties”) has through this Report

and related materials provided any investment advice within the meaning of Section 3(21) of ERISA to the Plan in connection with

the decision to purchase or acquire such Shares;

and (b) the information provided in this Report and related materials will not

make a Transaction Party a fiduciary to the Plan.

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