S-1/A

As filed with the Securities and Exchange Commission on February 3, 2017

Registration No. 333-212479

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Amendment No. 3

to

FORM S-1

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

SolidX Bitcoin Trust

(Exact name of Registrant as specified in its charter)

Delaware 6221 35-7161067 (State or Other Jurisdiction of Incorporation or Organization) (Primary Standard Industrial Classification Code Number) (I.R.S. Employer Identification No.)

200 Park Avenue

New York, New York 10166

(212) 273-9585

(Address, including zip code, and telephone number, including area code, of Registrants principal executive offices)

Daniel H. Gallancy

Chief Executive Officer

SolidX Management LLC

200 Park Avenue

New York, New York 10166

(212) 273-9585

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies to

Stuart M. Strauss, Esq.

Jeremy Senderowicz, Esq.

Dechert LLP

1095 Avenue of the Americas

New York, New York 10036

Approximate date of commencement of proposed sale to the public: As soon as practicable after the registration statement is declared effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. ☒

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement the same offering. ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☒ (Do not check if a smaller reporting company) Smaller reporting company ☐

CALCULATION OF REGISTRATION FEE

Title of Each Class of Securities To Be Registered Amount to be Registered Proposed Maximum Offering Price Per Share Proposed Maximum

Aggregate Offering Price(1) Amount of Registration Fee(2) SolidX Bitcoin Shares [ ] [ ] $1,000,000 $100.70

(1) Estimated solely for the purpose of determining the amount of the registration fee in accordance with Rule 457(d) under the Securities Act of 1933.

(2) $100.70 was previously paid in the initial filing of the registration statement on Form S-1, filed on July 12, 2016.

The Registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.

SUBJECT TO COMPLETION, DATED FEBRUARY 3, 2017

[ ],000 SolidX Bitcoin Shares

SOLIDX BITCOIN TRUST

The SolidX Bitcoin Trust (Trust) will issue SolidX Bitcoin Shares (Shares), which represent units of fractional undivided beneficial interest in and ownership of the Trust. The Trust will seek to provide shareholders with exposure to the daily change in the U.S. dollar price of bitcoin, before expenses and liabilities of the Trust, as measured by the TradeBlock XBX Index (XBX). The Trust is not actively managed.

The Trusts assets will consist of bitcoin, an asset that can be transferred among parties via the Internet, but without the use of a central administrator or clearing agency. The Trust will occasionally hold cash for short periods in connection with the purchase and sale of bitcoin, and to pay Trust expenses.

SolidX Management LLC is the sponsor of the Trust (Sponsor) and custodian of the Trusts bitcoin (bitcoin Custodian). Delaware Trust Company is the trustee (Trustee). The Bank of New York Mellon is the administrator (Administrator), transfer agent (Transfer Agent) and the custodian, with respect to cash, (Cash Custodian) of the Trust. Foreside Fund Services, LLC is the order examiner (Order Examiner) in connection with the creation and redemption of Baskets of Shares.

The Shares are issued by the Trust only in one or more blocks of 100,000 Shares, called a Basket, principally in exchange for cash. The Trust will issue and redeem Shares in Baskets to certain registered broker-dealers or other securities market participants who have entered into a contract with the Sponsor and Transfer Agent (Authorized Participants) on an ongoing basis as described in Creation and Redemption of Shares. Baskets will be issued and redeemed on an ongoing basis at net asset value (NAV) on the day that an order to create a Basket is accepted by the Transfer Agent and approved by the Order Examiner.

Shares will be offered to the public from time to time at prices that will reflect, among other things, the price of bitcoin and the trading price of the Shares on NYSE Arca at the time of the offer. Prior to this offering, there has been no public market for the Shares. The Shares of the Trust are expected to be listed for trading, subject to notice of issuance, on NYSE Arca, Inc. (NYSE Arca or the Exchange), under the symbol XBTC. The market price of the Shares may be different from the NAV per Share.

Except when aggregated in Baskets, Shares are not redeemable securities.

THE SHARES ARE SPECULATIVE SECURITIES AND THEIR PURCHASE INVOLVES A HIGH DEGREE OF RISK. YOU SHOULD CONSIDER ALL RISK FACTORS BEFORE INVESTING IN THE TRUST. PLEASE REFER TO THE RISKS YOU FACE BEGINNING ON PAGE 13.

 Bitcoin is a new technological innovation with a limited history. There is no assurance that usage of bitcoin will continue to grow. A contraction in use of bitcoin may result in increased volatility or a reduction in the price of bitcoin, which could adversely impact the value of the Shares.  Bitcoin trading prices are volatile and shareholders could lose all or substantially all of their investment in the Trust.  Loss of the Trusts bitcoin may be irreversible and could result in the loss of all or substantially all of an investment in the Trust.  Regulation of bitcoin continues to evolve in both the U.S. and foreign jurisdictions, which may restrict the use of bitcoin or otherwise impact the demand for bitcoin.

Neither the Securities and Exchange Commission (SEC) nor any state securities commission has approved or disapproved of the securities offered in this prospectus (Prospectus), or determined if this Prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

The Trust qualifies as an emerging growth company as defined in the Jumpstart Our Business Startups Act (JOBS Act). Emerging growth company does not mean the Trust is a growth type of investment vehicle or that it will utilize a growth investment strategy. However, the Trust will not take advantage of any exemptions or other relief provided to emerging growth companies under the JOBS Act. See Emerging Growth Company Status.

The Shares are neither interests in nor obligations of the Sponsor or the Trustee or any of their respective affiliates. The Shares are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other governmental agency. The Trust is not an investment company registered under the Investment Company Act of 1940, as amended. The Trust is not a commodity pool for purposes of the Commodity Exchange Act of 1936, as amended, and the Sponsor is not subject to regulation by the Commodity Futures Trading Commission as a commodity pool operator or a commodity trading advisor.

On [●], 2017, an initial purchaser, subject to conditions, deposited cash for the purchase of [] initial Basket[s] totaling [●] Shares. Delivery of the initial Baskets will be made on or about the date of this Prospectus, upon condition of effectiveness of the related registration statement. The Trust received all proceeds from the offering of the initial Basket[s] in cash in an amount equal to the full price for the initial Basket[s].

Per Share(1) Per Basket Public offering price for initial Baskets(2) $ [●] $ [●]

(1) The initial Basket[s] [were/was] created at a per share price equal to the value of 1/100th of a bitcoin on the date of formation of the Trust.

(2) The initial purchaser may receive commissions/fees from shareholders who purchase shares from the initial Basket[s] through their commission/fee-based brokerage accounts. The price per basket that will be paid in the future by the Authorized Participants may be different than the initial Basket price.

The date of this Prospectus is [ ], 2017.

TABLE OF CONTENTS

This Prospectus contains information you should consider when making an investment decision about the Shares. You may rely on the information contained in this Prospectus. The Trust and the Sponsor have not authorized any person to provide you with different information and, if anyone provides you with different or inconsistent information, you should not rely on it. This Prospectus is not an offer to sell the Shares in any jurisdiction where the offer or sale of the Shares is not permitted.

The Shares are not registered for public sale in any jurisdiction other than the United States.

STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

This Prospectus includes statements which relate to future events or future performance. In some cases, you can identify such forward-looking statements by terminology such as may, will, should, expect, plan, anticipate, believe, estimate, predict, potential or the negative of these terms or other comparable terminology. All statements (other than statements of historical fact) included in this Prospectus that address activities, events or developments that may occur in the future, including such matters as changes in asset prices and market conditions (for bitcoin and the Shares), the Trusts operations, the Sponsors plans and references to the Trusts future success and other similar matters are forward-looking statements. These statements are only predictions. Actual events or results may differ materially. These statements are based upon certain assumptions and analyses made by the Sponsor on the basis of its perception of historical trends, current conditions and expected future developments, as well as other factors it believes are appropriate in the circumstances. Whether or not actual results and developments will conform to the Sponsors expectations and predictions, however, is subject to a number of risks and uncertainties, including the special considerations discussed in this Prospectus, general economic, market and business conditions, changes in laws or regulations, including those concerning taxes, made by governmental authorities or regulatory bodies, and other world economic and political developments. See The Risks You Face. Consequently, all the forward-looking statements made in this Prospectus are qualified by these cautionary statements, and there can be no assurance that the actual results or developments the Sponsor anticipates will be realized or, even if substantially realized, that they will result in the expected consequences to, or have the expected effects on, the Trusts operations or the value of the Shares. Moreover, neither the Sponsor, nor any other person assumes responsibility for the accuracy or completeness of the forward-looking statements. Neither the Trust nor the Sponsor undertakes an obligation to publicly update or conform to actual results any forward-looking statement, whether as a result of new information, future developments or otherwise, except as required by law.

-ii-

PROSPECTUS SUMMARY The following is only a summary of this Prospectus and, while it contains material information about the Trust, it does not contain or summarize all of the information about the Trust and the Shares contained in this Prospectus that is material and that may be important to you. You should read this entire Prospectus, including The Risks You Face beginning on page 13, and the material incorporated by reference herein before making an investment decision about the Shares. Bitcoin A bitcoin is an asset that can be transferred among parties via the Internet, but without the use of a central administrator or clearing agency. Bitcoin with an upper case B describes the system as a whole (i.e., the network of computers running the software protocol underlying bitcoin involved in maintaining the database of bitcoin ownership and facilitating the transfer of bitcoin among parties). When written with a lower case b, the word bitcoin refers to the unit of account within the Bitcoin network. The Bitcoin network and the asset, bitcoin, are intrinsically linked and inseparable. The Bitcoin network, which has existed since 2009, can be used both as a value transfer system (i.e. the transfer of bitcoin from one party to another) and for non-financial applications. Development of the Bitcoin networks usage for non-financial applications has become increasingly prominent, including applications such as: asset title transfer, secure timestamping, counterfeit and fraud detection systems, secure document and contract signing, distributed cloud storage and identity management. As a mechanism purely for the transfer of value, the Bitcoin network has processed more than 190 million transactions since its inception. More than 100,000 merchants accept bitcoin for goods and services. To date, venture capitalists have invested more than $1 billion in businesses related to Bitcoin and the blockchain, the technology underlying the Bitcoin network. The Trust SolidX Bitcoin Trust (the Trust) was formed as a Delaware statutory trust on September 15, 2016. The Trust is governed by the Amended and Restated Declaration of Trust and Trust Agreement (Trust Agreement) dated February 1, 2017 between SolidX Management LLC (the Sponsor) and Delaware Trust Company (the Trustee). The Trust will issue common units of beneficial interest, or Shares, which represent units of fractional undivided beneficial interest in the Trusts net assets. The Trusts assets will consist of bitcoin, the unit of account within the Bitcoin network as described in the preceding paragraphs. The Trust will occasionally hold cash for short periods in connection with the Basket creation and redemption process, and to pay the Sponsors Management Fee, the bitcoin Insurance Fee and any other Trust expenses and liabilities not assumed by the Sponsor. The Shares provide shareholders with the opportunity to access the bitcoin market though a traditional brokerage account. The Sponsor believes that shareholders will be able to more effectively implement strategic and tactical asset allocation strategies that use bitcoin by investing in the Shares than by purchasing, holding and trading bitcoin directly. The value of bitcoin will be reported on the Trusts website daily as measured by the TradeBlock Bitcoin Index (XBX). Shares are issued by the Trust only in blocks of 100,000 Shares called Baskets principally in exchange for cash from certain registered broker-dealers or other securities market participants (Authorized Participants). See Creation and Redemption of Shares for requirements to qualify as an Authorized Participant. Baskets will be redeemed by the Trust principally in exchange for the amount of cash corresponding to their redemption value. Baskets may also be created or redeemed partially or wholly in exchange for bitcoin at the discretion of the Sponsor if the Authorized Participant can convey bitcoin directly to the Trust. The Trust issues and redeems Baskets on an ongoing basis at net asset value (NAV) to Authorized Participants who have entered into a contract with the Sponsor and the Transfer Agent.



1

Individual Shares will not be redeemed by the Trust, but are expected to be listed for trading, subject to notice at issuance, on NYSE Arca under the symbol XBTC. The material terms of the Trust and the Shares are discussed in greater detail under the sections Description of the Trust and Description of the Shares. The Trust is not a registered investment company under the Investment Company Act of 1940, as amended (1940 Act), and is not required to register with the Securities and Exchange Commission thereunder. The Trust is not a commodity pool for purposes of the Commodity Exchange Act of 1936, as amended, and the Sponsor is not subject to regulation by the Commodity Futures Trading Commission as a commodity pool operator or a commodity trading advisor. Shareholders may purchase and sell Shares through traditional brokerage accounts. Secondary market purchases and sales of Shares are subject to customary brokerage commissions and charges. Shareholders are encouraged to review the terms of their brokerage accounts for applicable charges. The market price of the Shares may not be identical to the NAV per Share. The intra-day indicative value per Share is based on the prior days final NAV per Share, adjusted every 15 seconds throughout the day to reflect the continuous price changes of the Trusts bitcoin holdings, to provide a continuously updated indicative intra-day value per Share. The Trust is not involved in or responsible for the calculation or dissemination of the indicative intra-day value per Share and makes no warranty as to the accuracy of the indicative intra-day value per Share. The Sponsor The Sponsor is a Delaware limited liability company. The Shares are neither interests in nor obligations of, and are not guaranteed by, the Sponsor, its member(s), or any of its affiliates. The Sponsor: (1) will select the Trustee, Administrator, Transfer Agent, Cash Custodian, Order Examiner and any other Trust service providers; (2) will negotiate various agreements and fees for the Trust; (3) will develop a marketing plan for the Trust on an ongoing basis and prepare marketing materials regarding the Shares; (4) will maintain the Trusts website; (5) will buy and sell bitcoin with a view to causing the performance of the Trust to track that of the XBX, over time, before expenses and liabilities of the Trust; (6) will provide custody services pursuant to the bitcoin Custody Agreement relating to custody of the Trusts bitcoin; and (7) will perform such other services as the Sponsor believes that the Trust may require. The general role and responsibilities of the Sponsor are discussed in greater detail under the section The Sponsor. The Sponsor arranged for the creation of the Trust, the registration of the Shares for their public offering in the United States and the listing of the Shares on NYSE Arca. The Sponsor generally oversees the performance of the Trusts principal service providers, but does not exercise day-to-day oversight of the Trustee, Administrator, Transfer Agent, Cash Custodian, Order Examiner or other such service providers. The Sponsor may compensate its affiliates for providing marketing and other services to the Trust without any additional cost to the Trust. The Sponsor maintains a public website on behalf of the Trust, containing information about the Trust and the Shares. The Internet address of the Trusts website is [●]. This Internet address is only provided here as a convenience to you, and the information contained on or connected to the Trusts website is not considered part of this Prospectus. The Sponsor has agreed to assume the following administrative and marketing expenses incurred by the Trust: each of the Trustees, Administrators, Cash Custodians, Transfer Agents and Order Examiners monthly fee and out-of-pocket expenses and expenses reimbursable in connection with such service providers respective agreement; bitcoin storage fees in its capacity as bitcoin Custodian; the marketing support fees and expenses; exchange listing fees; SEC registration fees; index license fees; printing and mailing costs; maintenance expenses for the Trusts website; audit fees and expenses; and up to $100,000 per annum in legal expenses. The Sponsor will not be responsible for paying the premiums associated with the bitcoin insurance that will be maintained by the Trust. The Sponsor also paid the costs of the Trusts organization and the initial sale of the Shares. See The Sponsor, The Trusts bitcoin Security System and The Trusts bitcoin Insurance.



2

The Trustee Delaware Trust Company, 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 of Section 3807(a) of the DSTA that the Trust have at least one trustee with a principal place of business in the State of Delaware. The duties of the Trustee will be limited to (i) accepting legal process served on the Trust in the State of Delaware and (ii) the execution of any certificates required to be filed with the Delaware Secretary of State which the Trustee is required to execute under the DSTA. To the extent that, at law or in equity, the Trustee has duties (including fiduciary duties) and liabilities relating thereto to the Trust or the Trusts shareholders, such duties and liabilities will be replaced by the duties and liabilities of the Trustee expressly set forth in the Trust Agreement. The Trustee will have no obligation to supervise, nor will it be liable for, the acts or omissions of the Sponsor, Administrator, Transfer Agent, Cash Custodian, Order Examiner or any other person. See The Trustee. The Administrator The Administrator is The Bank of New York Mellon. The Administrator is generally responsible for the day-to-day administration and operation of the Trust, including: (1) valuing the Trusts bitcoin and calculating the net asset value per share of the Trust and the net asset value of the Trust; (2) supplying pricing information to the Sponsor for the Trusts website; and (3) receiving and reviewing reports on the custody of and transactions in cash and bitcoin from the Cash Custodian and Sponsor, as bitcoin Custodian, respectively, and taking such other actions in connection with the custody of cash as the Sponsor instructs. The general role and responsibilities of the Administrator are discussed in greater detail under the section The Administrator. The Transfer Agent The Transfer Agent is The Bank of New York Mellon. Pursuant to the Transfer Agency and Service Agreement between the Trust and the Transfer Agent, the Transfer Agent serves as the Trusts transfer agent and agent in connection with certain other activities as provided under the Transfer Agency and Service Agreement. The Transfer Agents responsibilities include: (1) receiving and processing orders from Authorized Participants for the creation and redemption of Baskets; and (2) coordinating the processing of orders from Authorized Participants with the Order Examiner, the bitcoin Custodian, the Cash Custodian and The Depository Trust Company (DTC). See The Transfer Agent. The Order Examiner Foreside Fund Services, LLC is the Order Examiner. The Order Examiners responsibilities include: (1) working with the Transfer Agent to review and accept or reject orders placed by Authorized Participants and transmitted to the Order Examiner by the Transfer Agent; (2) ensuring that all direct requests for prospectuses, product descriptions and periodic reports with respect to the Trust and are fulfilled; (3) providing the Exchange, as directed, with copies of prospectuses and product descriptions to be provided to purchasers in the secondary market; (4) reviewing and approving all sales and marketing materials for compliance with applicable laws and conditions of any applicable exemptive order, and filing such materials with FINRA as required by the Securities Act, and the rules promulgated thereunder. All such sales and marketing materials must be approved, in writing, by the Order Examiner prior to use. The Order Examiner will also facilitate arrangements between the Sponsor, the Transfer Agent and broker-dealers for the purchase and redemption of Baskets.



3

Custodial Arrangements The Bank of New York Mellon is the custodian (the Cash Custodian) of the cash held by the Trust and has entered into the Cash Custody Agreement in connection therewith. The Sponsor will provide custody services relating to custody of the Trusts bitcoin and has entered into the bitcoin Custody Agreement in connection therewith. See The Cash Custodian and The Sponsor. Trust Objective The Trust will seek to provide shareholders with exposure to the daily change in the U.S. dollar price of bitcoin, before expenses and liabilities of the Trust, as measured by the XBX. The Trust intends to achieve this objective by investing substantially all of its assets in bitcoin traded on various domestic and international bitcoin exchanges and over-the-counter (OTC) markets depending on liquidity and otherwise at the Sponsors discretion. The Trust will invest in bitcoin on a non-discretionary basis (i.e., without regard to whether the value of bitcoin is rising or falling over any particular period). Bitcoin is an asset that is not issued by any government, bank or organization. A bitcoin is an asset that can be transferred among parties via the Internet, but without the use of a central administrator or clearing agency. The asset, bitcoin, is generally written with a lower case b. When written with an uppercase B, the word Bitcoin generally refers to the computers and software (or the protocol) involved in the transfer of bitcoin among users. The computers running Bitcoin software constitute the Bitcoin network. The asset, bitcoin, is the intrinsically linked unit of account that exists within the Bitcoin network. The Bitcoin network records each bitcoin balance (i.e., the quantity of bitcoin) held by each user on a database referred to as the blockchain. Each transfer of bitcoin between users is known as a bitcoin transaction. Approximately every ten minutes, the Bitcoin network groups together new transactions into what are referred to as blocks. Transactions in each block refer to transactions in previous blocks, thereby growing the blockchain and enabling it to serve as a consistent database of all bitcoin transactions and balances. The blockchains record of transactions and balances provides a complete historical record of all activity within the Bitcoin network since Bitcoins inception in January 2009. Copies of the blockchain are stored on various computers participating in the Bitcoin network. The blockchain can be used for a variety of non-financial applications, but all uses involve the expenditure of some quantity of bitcoin. See Bitcoin and the Bitcoin Industry. The Trust will be insured against loss or theft of bitcoin held by the Trust. The insurance will cover loss of bitcoin by, among other things, theft, destruction, bitcoin in transit, computer fraud (i.e., hacking attack), and other loss of numerical codes, known as private keys, which are necessary to access the bitcoin held by the Trust. The insurance will not cover certain losses including, but not limited to the following:  Loss caused or contributed by theft or any other fraudulent, dishonest or criminal act committed by a partner, employee or director of the Sponsor, controlling more than 25% of the issued share capital of the Sponsor or any of its subsidiaries.  Loss caused by an employee if an elected or appointed official of the Trust or the Sponsor (not in collusion) knows of any act or acts of theft, fraud or dishonesty involving amounts in excess of $5,000 by such employee prior to the Trusts or Sponsors discovery of a loss caused by such act or acts of the employee.  Any and all losses caused by an employee who has access to the private key(s) associated with the Trusts bitcoin if an elected or appointed official of the Trust or Sponsor becomes aware of any act or acts of theft, fraud or dishonesty by such employee prior to the Trusts or Sponsors discovery of a loss caused by such act or acts.  Loss of the private key(s) associated with the Trusts bitcoin where such private key(s) is stored or being transmitted between computers or similar electronic devices that are connected to the Internet.



4

 Any and all loss resulting from the network failure of the Bitcoin protocol. See The Trusts bitcoin Insurance. Advantages of investing in the Shares include:  Ease and Flexibility of Investment. The Shares will trade on NYSE Arca and provide shareholders with indirect exposure to the price of bitcoin. The Shares may be bought and sold throughout the business day at real-time market prices on NYSE Arca like other exchange-listed securities. Shareholders will be able to purchase and sell Shares through traditional brokerage accounts.  Insurance. As noted above, the bitcoin held by the Trust will be insured against loss or theft of bitcoin.  Diversification. The correlation between bitcoin and global financial markets for equities, commodities and fixed income has, since bitcoins inception in 2009, generally been low, so the Shares may help to diversify an investment portfolio. The Index Schvey, Inc. d/b/a TradeBlock (TradeBlock) is the sponsor and calculation agent for the XBX. The XBX is a real-time U.S. dollar-denominated composite reference rate for the price of bitcoin. The XBX calculates the intra-day price of bitcoin every second, including the closing price as of 4:00 p.m. E.T. The intra-day price and closing price are based on a methodology that consists of collecting and cleansing actual trade data from several bitcoin exchanges included within the index. To ensure that TradeBlocks exchange selection process is impartial, TradeBlock implements a standardized eligibility framework that includes elements such as depth of liquidity, compliance with applicable legal and regulatory requirements, data availability, and acceptance of U.S. dollar deposits. As of January 15, 2017, the eligible bitcoin exchanges selected by TradeBlock for inclusion in the XBX are Bitfinex, Bitstamp, GDAX (f/k/a Coinbase), itBit and OKCoin International. The logic utilized for the derivation of the daily closing index level for the XBX is intended to analyze actual bitcoin transactional data, verify and refine the data set, and yield an objective, fair-market value of one bitcoin as of 4:00 p.m. E.T. each weekday, priced in U.S. dollars. As discussed herein, the XBX intra-day price and the XBX closing price are collectively referred to as the XBX price, unless otherwise noted. TradeBlocks XBX index has been in operation since July 2014. The key elements of the algorithm underlying the XBX include:  Volume/Liquidity Weighting: Exchanges with greater liquidity receive a higher weighting in the XBX, increasing the ability to execute against the index in the underlying spot markets. Liquidity weighting also mitigates the impact of volume spikes during off-peak trading hours.  Price Variance Weighting: The XBX price reflects data points that are discretely weighted in proportion to their variance from contemporaneous pricing data reflected on the indexs constituent exchanges. As the price at a particular exchange diverges from the rest of the data points, its influence on the index consequently decreases.  Inactivity Adjustment: The algorithm penalizes stale ticks on any given exchange. If an exchange does not have recent trading data, its weighting is gradually reduced, until it is de-weighted entirely. Similarly, once activity resumes, the corresponding weighting for that constituent is gradually increased until it reaches the appropriate level.



5

 Thin Order Books: The XBX minimizes the impact of thin order books and fluctuating prices, which provides a more stable and reliable benchmark for the price of bitcoin. The XBX index calculation methodology and governance protocol are based on the principles established by the International Organization of Securities Commissions for financial benchmarks. TradeBlock conducts a quarterly review of the constituent exchanges and the algorithm used to calculate XBX prices and maintains a history of all updates. In the event of market stress or unresponsive input data from the constituent exchanges, the XBX algorithm will incorporate a minimum of one input to calculate a benchmark value. In the unlikely event of no input data from all constituent values, the index will default to the most recent value for which one or more inputs were present. Pricing Information Available on NYSE Arca and Other Sources The following table lists NYSE Arca symbols and their descriptions with respect to the Shares and the XBX: Ticker Description XBTC Market price per Share on NYSE Arca [●] Indicative intra-day value per Share [●] End of day NAV [●] Number of outstanding Shares The intra-day data in the above table is published once every 15 seconds throughout each trading day. The current market price per Share (symbol: XBTC) will be published continuously as trades occur throughout each trading day on the consolidated tape by market data vendors. The intra-day indicative value per Share (symbol: [●]) will be published by NYSE Arca once every 15 seconds throughout each trading day on the consolidated tape by market data vendors. The most recent end-of-day NAV (symbol: [●]) will be published as of the close of business by market data vendors and available on the Sponsors website at [●], or any successor thereto, and will be published on the consolidated tape. The number of outstanding Shares (symbol: [●]) will be published once every 15 seconds throughout the trading day and as of the close of business for NYSE Arca on the consolidated tape by market data vendors. Any adjustments made to the XBX will be published on the TradeBlock website at https://tradeblock.com/markets/index/ or any successor thereto. The intra-day levels and closing levels of the XBX are published by TradeBlock, and the closing NAV is published by the Administrator. The Shares are not issued, sponsored, endorsed, sold or promoted by NYSE Arca, and NYSE Arca makes no representation regarding the advisability of investing in the Shares. TradeBlock makes no warranty, express or implied, as to the results to be obtained by any person or entity from the use of the XBX index for any purpose. Index information and any other data calculated and/or disseminated, in whole or part, by TradeBlock is for informational purposes only, not intended for trading purposes, and provided on an as is basis. TradeBlock does not warrant that the index information will be uninterrupted or error-free, or that defects will be corrected. TradeBlock also does not recommend or make any representation as to possible benefits from any securities or investments, or third-party products or services. Investors should undertake their own due diligence regarding securities and investment practices.



6

Summary Risk Factors An investment in the Shares is speculative and involves a high degree of risk. There is no assurance the Trust will achieve its investment objective or avoid substantial losses. A potential shareholder should not invest in the Shares unless he or she can afford to lose the entire investment. Before investing in the Shares, a potential shareholder should be aware of the various risks of investing in the Trust, including those described below. Additional risks and uncertainties not presently known by the Trust or not presently deemed material by the Trust may also impair the Trusts operations and performance. The summary risk factors set forth below are intended to highlight certain risks of investing in the Trust. A more extensive discussion of these risks appears beginning on page 13 in The Risks You Face.  Bitcoin is a new technological innovation with a limited history. There is no assurance that usage of bitcoin and the blockchain will continue to grow. A contraction in use of bitcoin or the blockchain may result in increased volatility or a reduction in the price of bitcoin, which could adversely impact the value of the Shares.  A decline in the adoption of bitcoin could negatively impact the performance of the Trust.  The loss or destruction of certain private keys (numerical codes required by the Trust to access its bitcoin) could prevent the Trust from accessing its bitcoin. Loss of these private keys may be irreversible and could result in the loss of all or substantially all of an investment in the Trust.  Bitcoin trading prices are volatile and shareholders could lose all or substantially all of their investment in the Trust.  Regulation of bitcoin continues to evolve in both the U.S. and foreign jurisdictions, which may restrict the use of bitcoin or otherwise impact the demand for bitcoin.  The Trusts return may not match the performance of the price of bitcoin due to, among other factors, the Trust incurring operating expenses.  Sales of newly mined bitcoin may cause the price of bitcoin to decline, which could negatively affect an investment in the Shares.  The NAV of the Trust may not always correspond to the market price of the Shares and, as a result, Baskets may be created or redeemed at a value that differs from the market price of the Shares.  Disruptions at bitcoin exchanges and potential consequences of a bitcoin exchanges failure could adversely affect an investment in the Shares.  The Trusts bitcoin trading may subject the Trust to the risk of counterparty non-performance, potentially negatively impacting the market price of the Shares.  The Trusts bitcoin insurance may be unavailable and may not protect the Trust against all losses and liabilities.  Shareholders of the Trust will be subject to taxation on their allocable share of the Trusts taxable income, whether or not they receive cash distributions.



7

Principal Offices The offices of the Trust and the Sponsor are located at 200 Park Avenue, New York, New York 10166 and the Trusts telephone number is (212) 273-9585. The office of the Trustee is located at 2711 Centerville Road, Wilmington, Delaware 19808. The offices of the Administrator, Transfer Agent and Cash Custodian are located at 2 Hanson Place, Brooklyn, New York 11217. The offices of the Order Examiner are located at Three Canal Plaza, Suite 100, Portland, Maine 04101. Emerging Growth Company Status The Trust is an emerging growth company, as defined in the JOBS Act, and is eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not emerging growth companies including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002 and reduced disclosure obligations that are not otherwise applicable to the Trust. In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended (the Securities Act), for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. However, the Trust is choosing to opt out of such extended transition period, and as a result, will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. Section 107 of the JOBS Act provides that the decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable. THE OFFERING Offering The Shares represent units of fractional undivided beneficial interest in the net assets of the Trust. Use of proceeds Proceeds received by the Trust from the issuance and sale of Baskets will consist of cash and, in some instances, may consist partially or wholly of bitcoin. Cash proceeds will be received by the Cash Custodian and transferred to the Sponsor to purchase bitcoin for the Trust. The Sponsor, as bitcoin Custodian, will hold the bitcoin purchased by the Sponsor on the Trusts behalf, and the bitcoin received by the Trust from the issuance and sale of Baskets, until (1) bitcoin is sold for cash, which is distributed to Authorized Participants in connection with redemptions of Baskets, (2) bitcoin is distributed to Authorized Participants in connection with redemptions of Baskets or (3) bitcoin is sold for cash to pay Trust expenses and liabilities not assumed by the Sponsor. See Description of the TrustTrust Expenses. NYSE Arca Symbol XBTC CUSIP 0125439476 Creation and Redemption Authorized Participants The Trust receives cash deposited with the Cash Custodian only by Authorized Participants in exchange for the creation of Baskets, each equal to 100,000 Shares. Conversely, the Trust delivers cash in exchange for Baskets surrendered to it for redemption by Authorized Participants. The Trust issues and redeems Baskets on a continuous basis only to Authorized Participants. Baskets are only issued or redeemed in exchange for the amount of cash (and, potentially, in



8

-kind for bitcoin) determined by the Administrator on each day that NYSE Arca is open for regular trading based on the combined net asset value of the Shares included in the Baskets being created or redeemed. No Shares are issued unless the Cash Custodian and/or bitcoin Custodian confirms that the Trust has been allocated the corresponding amount of cash and/or bitcoin. The initial amount of cash required for deposit with the Trust to create Shares for the period beginning with the formation of the Trust and ending on the first day of trading of the Shares on the NYSE Arca was [●] per Basket. Fees are assessed in connection with the creation and redemption of Baskets by Authorized Participants. See Creation and Redemption of Shares for more details. Net Asset Value Net asset value means the total assets of the Trust including, but not limited to, all bitcoin and cash less total liabilities of the Trust, each determined on the basis of generally accepted accounting principles. The Administrator determines the net asset value of the Trust on each day that NYSE Arca is open for regular trading, as promptly as practical after 4:00 PM E.T. The net asset value of the Trust is the aggregate value of the Trusts assets less its estimated accrued but unpaid liabilities (which include accrued expenses). In determining the Trusts net asset value, the Administrator values the bitcoin held by the Trust based on the price set by the XBX as of 4:00 p.m. E.T. (XBX Price). The Administrator also determines the net asset value per share. If on a day when the Trusts net asset value is being calculated the XBX Price for that day is not available, the Administrator will value the bitcoin held by the Trust based on alternative means. See Description of the TrustPricing Sources. Trust Fees and Expenses The Trusts only ordinary recurring operating expenses are expected to be the Sponsors management fee of [●]% of the net asset value of the Trust (Management Fee), and the insurance premium related to the insurance policies on the Trusts bitcoin, which is expected to be approximately [●]% of the net asset value of the Trust (bitcoin Insurance Fee). In exchange for the Management Fee, the Sponsor has agreed to assume the ordinary administrative and marketing expenses that the Trust is expected to incur. The Sponsors Management Fee will accrue daily based on the prior business days net asset value and will be payable on a monthly basis in arrears. The Trust will sell bitcoin to raise cash to pay the Management Fee, the bitcoin Insurance Fee and other expenses not assumed by the Sponsor. At the Sponsors discretion, the Trust may pay the Sponsors Management Fee in bitcoin. See Description of the TrustTrust Expenses. Organization and Offering Expenses The Sponsor will be responsible for paying all of the expenses incurred in connection with organizing the Trust as well as the expenses incurred in connection with the offering of the Trusts Shares.



9

Extraordinary Fees and Expenses The Trust will be responsible for paying, or for reimbursing the Sponsor or its affiliates for paying, all the extraordinary fees and expenses, if any, of the Trust. Extraordinary fees and expenses are fees and expenses which are non-recurring and unusual in nature, such as legal claims and liabilities, litigation costs or indemnification or other unanticipated expenses. Extraordinary fees and expenses also include material expenses which are not currently anticipated obligations of the Trust. Such extraordinary fees and expenses, by their nature, are unpredictable in terms of timing and amount. Insurance The Trust will be responsible for paying the premiums associated with the insurance coverage for the bitcoin held by the Trust. Tax Considerations A shareholder will be treated, for federal tax purposes, as if it directly owns a pro rata share of the Trusts assets and directly receives that share of any Trust income and incurs that share of the Trusts expenses. Shareholders of the Trust will be subject to taxation on their allocable share of the Trusts taxable income, whether or not they receive cash distributions. Each delivery, transfer or sale of bitcoins by the Trust in connection with redemptions or to pay the Sponsors Management Fee, bitcoin Insurance Fee or other expenses could be a taxable event to shareholders. See Federal Income Tax ConsequencesTaxation of U.S. Shareholders and Purchases by Employee Benefit Plans. Suspension of Issuance,

Transfers and Redemptions The Sponsor may suspend the delivery or registration of transfers of Shares, or may refuse a particular deposit or transfer at any time, if the Sponsor considers it advisable or necessary for any reason. Redemptions by Authorized Participants of Shares may and, on the direction of the Sponsor, shall, be generally suspended or particularly rejected by the Transfer Agent or Order Examiner (1) during any period in which regular trading on NYSE Arca is suspended or restricted, or the NYSE Arca is closed, (2) the order is not in proper form as determined by the Trust, Transfer Agent or Order Examiner, (3) during an emergency as a result of which delivery, disposal or evaluation of bitcoin is not reasonably practicable, or (4) for such other period as the Sponsor determines to be necessary for the protection of shareholders. In addition, the Trust will reject a redemption order if the fulfillment of the order might be unlawful or if, as a result of the redemption, the number of remaining outstanding Shares would be reduced to fewer than the number of Shares in one Basket. See Creation and Redemption of SharesRejection of purchase orders and Creation and Redemption of SharesSuspension or rejection of redemption orders.



10

Termination Events The Trust will terminate and liquidate if certain events occur. See Description of the TrustTermination of the Trust. Authorized Participants Authorized Participants may create and redeem Baskets. Each Authorized Participant must: (1) be a registered broker-dealer and a member in good standing with the Financial Industry Regulatory Authority (FINRA) or other securities market participant, such as a bank or other financial institution, which, but for an exclusion from registration, would be required to register as a broker-dealer to engage in securities transactions; (2) be a participant in DTC; and (3) have entered into an agreement with the Sponsor and the Transfer Agent (the Authorized Participant Agreement). The Authorized Participant Agreement provides the procedures for the creation and redemption of Baskets. A list of the current Authorized Participants can be obtained from the Administrator or the Sponsor. Clearance and Settlement The Shares will be evidenced by one or more global certificates that the Trust will issue to DTC. The Shares are issued only in book-entry form. Shareholders may hold their Shares through DTC, if they are participants in DTC, or indirectly through entities that are participants in DTC. Selling Commission Shareholders may purchase and sell Shares through traditional brokerage accounts. Shareholders are expected to be charged a customary commission by their brokers in connection with purchases of Shares that will vary from shareholder to shareholder. Shareholders are encouraged to review the terms of their brokerage accounts for applicable charges.



11

SUMMARY FINANCIAL CONDITION As of the close of business on [●], 2017, the net asset value of the Trust, which represents the value of the bitcoin and cash deposited into and held by the Trust, was $ [●] and the net asset value per Share was $ [●].



12

THE RISKS YOU FACE

An investment in the Trust involves the risk of losing money. Consider the risks below as well as the rest of the information in this Prospectus before making an investment decision.

Risks Associated With Investing Directly or Indirectly in bitcoin

Bitcoin Has a Short History.

Bitcoin was invented in 2009: the asset, bitcoin, and its trading history thus have existed for a relatively short time, which limits a potential shareholders ability to evaluate an investment in the Trust.

The Volatility of the Price of bitcoin May Affect the Value of the Shares.

The Shares are designed to mirror as closely as possible the performance of the price of bitcoin, as measured by the XBX, and the value of the Shares correlates directly to the value of the bitcoin held by the Trust, less the Trusts fees and expenses. Speculators and investors who seek to profit from trading and holding bitcoin generate a significant portion of bitcoin demand. The Sponsor believes that bitcoin speculation regarding future appreciation in the value of bitcoin may inflate and make more volatile the price of a bitcoin as measured by the XBX. As a result, bitcoin may be more likely to fluctuate in value due to changing investor confidence in future appreciation in the price of bitcoin. In the event the price of bitcoin declines, the value of the Shares would decline proportionately.

A Decline in the Adoption of Bitcoin Could Impact the Price of the Shares.

As a new asset and technological innovation, the Bitcoin industry is subject to a high degree of uncertainty. The adoption of bitcoin will require growth in its usage and in the blockchain, for various applications. Adoption of bitcoin will also require an accommodating regulatory environment. The Trust is not actively managed and will not have any strategy relating to the development of bitcoin and non-financial applications for the blockchain. A lack of expansion in usage of bitcoin and the blockchain could adversely affect an investment in the Shares.

In addition, there is no assurance that bitcoin will maintain its value over the long-term. The value of bitcoin is subject to risks related to its usage. Even if growth in bitcoin adoption occurs in the near or medium-term, there is no assurance that bitcoin usage will continue to grow over the long-term. A contraction in use of bitcoin may result in increased volatility or a reduction in the price of bitcoin, which would adversely impact the value of the Shares.

Sales of Newly Mined bitcoin May Cause the Price of bitcoin to Decline, Which Could Negatively Affect an Investment in the Shares.

Newly created bitcoin are generated through a process referred to as mining, and such bitcoin are referred to as newly mined bitcoin (see Bitcoin and the Bitcoin Industrybitcoin Mining and Transaction Fees). If entities engaged in bitcoin mining choose not to hold the newly mined bitcoin, and, instead, make them available for sale, there can be downward pressure on the price of bitcoin. A bitcoin mining operation may be more likely to sell a higher percentage of its newly created bitcoin, and more rapidly so, if it is operating at a low profit margin, thus reducing the price of bitcoin. Lower bitcoin prices may result in further tightening of profit margins for miners and worsening profitability, thereby potentially causing even further selling pressure. Decreasing profit margins and increasing sales of newly mined bitcoin could result in a reduction in the price of bitcoin, which could adversely impact an investment in the Shares.

The Loss or Destruction of a Private Key Required to Access bitcoin may be Irreversible.

Transfers of bitcoin among users are accomplished via bitcoin transactions (i.e., sending bitcoin from one user to another). The creation of a bitcoin transaction requires the use of a unique numerical code known as a private key. In the absence of the correct private key corresponding to a holders particular bitcoin, the bitcoin is inaccessible for usage. The Sponsor, as bitcoin Custodian, safeguards and keeps private the private keys relating to the Trusts bitcoin holdings. Although the Trust maintains insurance (see The Risks You FaceInsurance Related Risks), to the extent the Trusts private key is lost, destroyed or otherwise compromised and no backup of the private key is accessible, the Trust will be unable to access its bitcoin. Any such loss could adversely affect an investment in the Shares.

13

A Failure to Properly Monitor and Upgrade the Bitcoin Protocol by the Contributors of the Protocol Could Adversely Affect the Bitcoin Industry.

As discussed more fully below in Bitcoin and the Bitcoin Industry, the Bitcoin protocol runs on open source software that can be altered. The Bitcoin protocol could contain unknown flaws, which, upon detection by a malicious actor, could be used to damage the Bitcoin network. To the extent that software developers involved in maintaining the bitcoin protocol are unable to address potential flaws in the Bitcoin protocol adequately and in a timely manner, the Bitcoin industry may be adversely affected and any such result could adversely affect an investment in the Shares.

A Temporary or Permanent Blockchain Fork Could Adversely Affect an Investment in the Shares.

The Bitcoin software and protocol are open source. Any user can download the software, modify it and then propose that Bitcoin users and miners adopt the modification. When a modification is introduced and a substantial majority of users and miners consent to the modification, the change is implemented and the Bitcoin network remains uninterrupted. However, if less than a substantial majority of users and miners consent to the proposed modification, and the modification is not compatible with the software prior to its modification, the consequence would be what is known as a fork (i.e., split) of the Bitcoin network (and the blockchain), with one prong running the pre-modified software and the other running the modified software. The effect of such a fork would be the existence of two versions of the Bitcoin network running in parallel, but with each versions bitcoin (the asset) lacking interchangeability.

Additionally, a fork could be introduced by an unintentional, unanticipated software flaw in the multiple versions of otherwise compatible software users run. Although chain forks would likely be addressed by community-led efforts to merge the two chains (and in fact, several prior historical forks have been so merged), such a fork could adversely affect Bitcoins viability. It is possible, however, that a substantial number of Bitcoin users and miners could adopt an incompatible version of Bitcoin while resisting community-led efforts to merge the two chains. This would result in a permanent fork. If a permanent fork occurs, then the Trust would hold equal amounts of both the original bitcoin and the alternative new bitcoin. As a result, the Sponsor would need to decide whether to continue to hold the original bitcoin, the alternative new bitcoin or both, and what action to take with respect to the unselected bitcoin, such as the possible sale of the unselected bitcoin. The Sponsors decision to continue to hold either the original or alternative new bitcoin would be based on factors such as the market value and liquidity of the original bitcoin versus the alternative new bitcoin.

A Bitcoin fork could adversely affect an investment in the Shares or the ability of the Trust to operate.

A Disruption of the Internet May Affect Bitcoin Operations, Which May Adversely Affect the Bitcoin Industry and an Investment in the Shares.

The Bitcoin networks functionality relies on the Internet. A significant disruption of Internet connectivity (i.e., affecting large numbers of users or geographic regions) could prevent the Bitcoin networks functionality and operations until the Internet disruption is resolved. An Internet disruption could adversely affect an investment in the Shares or the ability of the Trust to operate.

An Actor Capable of Gaining Control In Excess of 50 Percent of the Transaction Confirmation Processing Power Could Manipulate the Blockchain and Adversely Affect the Bitcoin Industry.

The process of bitcoin mining adds new blocks to the blockchain. Blocks are sets of bitcoin transactions (i.e., records of transfers of bitcoin among users) and the blockchain is the database of all bitcoin transactions. The blockchain is stored and updated by computers participating in the Bitcoin network. Through the bitcoin mining process, unconfirmed bitcoin transactions are validated and grouped into a new block, which is then added to the blockchain (relatedly, bitcoin mining is the process by which new bitcoin are created). Bitcoin transactions can only be confirmed via the mining process, which makes mining a crucial component of the Bitcoin network.

14

The Bitcoin protocol is designed to work properly so long as no bitcoin miner has more than 50 percent of mining processing power in operation on the Bitcoin network. If a malicious actor obtains more than 50 percent of the processing power dedicated to mining, the malicious actor may be able to prevent transactions from being confirmed or change the date and time at which transactions are confirmed.

By possessing more than 50 percent of mining processing capacity, and thus having the majority of block creation power, a malicious actor might be able to create a fictional version of the blockchain database, in an attempt to modify the historical transaction record in the blockchain. By virtue of the fact that newer transactions in newer blocks in the blockchain refer to older transactions in prior blocks, the blockchain provides a historical record of all bitcoin transactions. A modification of the historical record could be used to trick Bitcoin users regarding the confirmation status of their transactions. A user may believe that he or she has already received a quantity of bitcoin in a confirmed transaction, but the malicious actor could, in essence, undo the transaction by changing the historical record. The victimized user(s) would later discover the bitcoin they thought to have received had, in fact, gone to another recipient. The perpetuation of changes to the historical transaction record would be detrimental to the Bitcoin network and adversely affect an investment in the Shares.

In addition, a reduction in the aggregate processing power expended by Bitcoin miners could increase the likelihood of a malicious actor obtaining control in excess of 50 percent of the mining processing power, potentially permitting such actor to manipulate the blockchain. To the extent such a malicious actor does not yield its majority control of the processing power or the Bitcoin community does not reject the blocks produced by the malicious actor, reversing any changes made to the blockchain may not be possible. Such changes could adversely affect an investment in the Shares or the ability of the Trust to operate.

Entities Engaged in the Mining Process Could be Coerced Into Acting in a Manner Detrimental to the Bitcoin Network.

If a nation state or other large and well-capitalized entity wanted to damage the Bitcoin network, an attack could be attempted on bitcoin miners. The attacking entity could attempt to coerce, by legal or illegal means, bitcoin miners who, in the aggregate, control more than 50 percent of the bitcoin mining capacity into manipulating the blockchain in a manner detrimental to the Bitcoin network. Such an attack could adversely affect an investment in the Shares or the ability of the Trust to operate.

A Well-Capitalized Entity Could Create Large Amounts of Mining Processing Power as a Means of Acting in a Manner Detrimental to the Bitcoin Network.

If a nation state or other large and well-capitalized entity wanted to damage the Bitcoin network, the entity could attempt to create, either from scratch or via large-scale purchases, a massive amount of mining processing power. If the entity were to create an amount of mining processing power in excess of 50 percent of the aggregate mining processing power, the entity could attempt to manipulate the blockchain in a manner detrimental to the Bitcoin network. Such an attack could adversely affect an investment in the Shares or the ability of the Trust to operate.

Miners May Cease Expanding Processing Power to Create Blocks and Verify Transactions if They Are Not Adequately Compensated, Which May Adversely Affect an Investment in the Shares or the Ability of the Trust to Operate.

Miners generate revenue from both newly created bitcoin (known as the block reward) and from fees taken upon verification of transactions. If the aggregate revenue from transaction fees and the block reward is below a miners cost, the miner may cease operations. An acute cessation of mining operations would reduce the collective processing power on the blockchain, which would adversely affect the transaction verification process by temporarily decreasing the speed at which blocks are added to the blockchain and make the blockchain more vulnerable to a malicious actor obtaining control in excess of 50 percent of the processing power on the blockchain. Reductions in processing power could result in material, though temporary, delays in transaction confirmation time. Any reduction in confidence in the transaction verification process or mining processing power may adversely impact an investment in the Shares or the ability of the Trust to operate.

15

Miners Could Act in Collusion to Raise Transaction Fees, Which May Adversely Affect the Usage of the Bitcoin Network.

Bitcoin miners, functioning in their transaction confirmation capacity, collect fees for each transaction they confirm. Miners validate unconfirmed transactions by adding the previously unconfirmed transactions to new blocks in the blockchain. Miners are not forced to confirm any specific transaction, but they are economically incentivized to confirm valid transactions as a means of collecting fees. Miners have historically accepted relatively low transaction confirmation fees, because miners have a very low marginal cost of validating unconfirmed transactions (see Bitcoin and the Bitcoin Industrybitcoin Mining and Transaction Fees). If miners collude in an anticompetitive manner to reject low transaction fees, then Bitcoin users could be forced to pay higher fees, thus reducing the attractiveness of the Bitcoin network. Bitcoin mining occurs globally and it may be difficult for authorities to apply antitrust regulations across multiple jurisdictions. Any collusion among miners may adversely impact the attractiveness of the Bitcoin network and may adversely impact an investment in the Shares or the ability of the Trust to operate.

The Incentive for Miners to Continue to Contribute Processing Power to the Blockchain Will Transition to Transaction Verification Fees as Block Rewards Decrease. Higher Transaction Verification Fees May Negatively Impact Demand for bitcoin, Which May Adversely Affect the Price of bitcoin and an Investment in the Shares.

The block reward will decrease over time. In the summer of 2020, the block reward will reduce from 12.5 to 6.25 bitcoin, and to 3.125 bitcoin in 2024. As the block reward continues to decrease over time, the mining incentive structure will transition to a higher reliance on transaction verification fees in order to incentivize miners to continue to dedicate processing power to the blockchain. If transaction verification fees become too high, the marketplace may be reluctant to use bitcoin. Decreased demand for bitcoin may adversely affect its price, which may adversely affect an investment in the Shares.

Any Widespread Delays in Recording bitcoin Transactions Could Result in a Loss of Confidence in Bitcoin, Which Could Adversely Impact an Investment in the Shares.

To the extent that bitcoin miners cease to record transactions in newly created blocks, such transactions will not be recorded on the blockchain. In a newly formed block, miners can include as few as zero transactions (e.g., an empty block) or as many as several thousand transactions. Currently, there are no known incentives for miners to elect to exclude the recording of transactions in newly created blocks. However, to the extent that any such incentives arise, actions of miners creating a significant number of empty blocks could delay the recording and confirmation of transactions on the blockchain. Any systemic delays in the recording and confirmation of transactions on the blockchain could result in greater risk of fraudulent activity, and a loss of confidence in Bitcoin, which could adversely impact an investment in the Shares or the ability of the Trust to operate.

It is Possible that a Small Group of Early bitcoin Adopters Control Large Amounts of Existing bitcoin. To the Extent these Individuals Sell their bitcoin, the Price of bitcoin May Decline.

There is no registry showing which individuals or entities own bitcoin or the quantity of bitcoin owned by any particular person or entity. It is possibly, and in fact, reasonably likely, that a small group of early bitcoin adopters hold a significant proportion of the bitcoin that has thus far been created. There are no regulations in place that would prevent a large holder of bitcoin from selling their bitcoin. Such bitcoin sales may adversely affect the price of bitcoin and an investment in the Shares.

A Successful Competitor to Bitcoin May Negatively Impact the Price of bitcoin and Adversely Affect an Investment in the Shares.

Bitcoin currently enjoys a first-mover advantage, with the largest user base, technological adoption, infrastructure development and dedicated transaction confirmation power (i.e., computing power dedicated to bitcoin mining) among its competitors. Having a large amount of dedicated computing power for mining results in greater user confidence regarding the security and long-term stability of the Bitcoin network and the blockchain. As a result, the advantage of more users and miners makes Bitcoin increasingly secure, which makes it more attractive to new users and miners, resulting in a network effect that strengthens its first-to-market advantage. There are numerous Bitcoin competitors, however, referred to as altcoins. To the extent an altcoin gains in popularity and greater market share, the use and price of bitcoin could be negatively impacted, which may adversely affect an investment in the Shares. Similarly, bitcoin or the price of bitcoin could be negatively impacted by competition from incumbents in the credit card and payments industries, which may adversely affect an investment in the Shares.

16

An Investment in the Shares May Be Adversely Affected By Competition From Other Methods of Investing in bitcoin.

The Trust will compete with direct investments in bitcoin and other potential financial vehicles, possibly including other securities backed by or linked to bitcoin and exchange traded products similar to the Shares. Market and financial conditions, and other conditions beyond the Sponsors control, may make it more attractive to invest in other financial vehicles or to invest in bitcoin directly, which could limit the market for the Shares and reduce the liquidity of the Shares.

Large-Scale Sales of bitcoin, Including as a Result of Political or Economic Crisis, May Adversely Affect An Investment in the Shares.

Political or economic events, either domestically or in foreign jurisdictions, may motivate large-scale buys or sales of bitcoin. Large-scale bitcoin sales may result in a decline in the price of bitcoin, which may adversely affect an investment in the Shares.

Market Related Risks

The Trust is Subject to Market Risk.

Market risk refers to the risk that the market price of bitcoin held by the Trust will rise or fall, sometimes rapidly or unpredictably. An investment in the Trusts Shares is subject to market risk, including the possible loss of the entire principal of the investment.

NAV May Not Always Correspond to the Market Price of bitcoin and, as a Result, Baskets May Be Created or Redeemed at a Value that Differs From the Market Price of the Shares.

The NAV of the Trust will change as fluctuations occur in the market price of the Trusts bitcoin holdings. Shareholders should be aware that the public trading price of a Basket may be different from the NAV of a Basket (i.e., Shares may trade at a premium over, or a discount to, the NAV of a Basket) and similarly the public trading price per Share may be different from the NAV. Consequently, an Authorized Participant may be able to create or redeem a Basket at a discount or a premium to the public trading price per Share. This price difference may be due, in large part, to the fact that supply and demand forces at work in the secondary trading market for Shares are related, but not identical, to the supply and demand forces influencing the market price of bitcoin, including as reflected on the XBX. Shareholders also should note that the size of the Trust in terms of total bitcoin held may change substantially over time and as Baskets are created and redeemed.

Authorized Participants or their clients may have an opportunity to realize a riskless profit if they can purchase a Basket at a discount to the public trading price of the Shares or can redeem a Basket at a premium over the public trading price of the Shares. The Sponsor believes that the exploitation of such arbitrage opportunities by Authorized Participants and their clients and customers should cause the public trading price of the Shares to track NAV closely over time; however, there can be no assurance that this will be the case.

To the extent the Sponsor permits Authorized Participants to create and redeem Baskets in -kind, Authorized Participants may purchase bitcoin for Basket creation or sell bitcoin from Basket redemptions on public or private markets not included among the constituent bitcoin exchanges of the XBX, and such transactions may take place at prices materially higher or lower than the XBX spot price. Furthermore, while the XBX provides a spot price based on the price of bitcoin on the XBXs constituent bitcoin exchanges at any given time, the prices on each such bitcoin exchange may not be equal to the value of a bitcoin as represented by the XBX. It is possible that the price of bitcoin on the bitcoin exchange(s) used by an Authorized Participant could be materially higher or lower than the XBX representation of the bitcoin market price. Under either such circumstance, the arbitrage mechanism will function to link the price of the Shares to the prices at which Authorized Participants are able to purchase or sell large aggregations of bitcoin. To the extent such prices differ materially from the XBX spot price, the price of the Shares may no

17

longer track, whether temporarily or over time, the XBX spot price, which could adversely impact an investment in the Trust by reducing shareholders confidence in the Shares ability to track the market price of bitcoin and the XBX spot price.

The following chart reflects the average, median and maximum price variances between the price of bitcoin as reflected by the XBX and the spot price of bitcoin on Bitfinex, Bitstamp, GDAX (f/k/a Coinbase), itBit, OKCoin International and BTC-e for the period July 2014, through January 2017:

Exchange Average Median Maximum Bitfinex 0.23% 0.12% 7.30% Bitstamp 0.26% 0.15% 6.74% Coinbase 0.22% 0.14% 2.15% itBit 0.27% 0.15% 3.63% OKCoin International 0.23% 0.15% 3.93% BTC-e 1.20% 0.98% 8.38%

Suspension or Disruptions of Market Trading May Adversely Affect the Value of Shares.

The Shares will be listed and traded on NYSE Arca. Trading in Shares may be halted due to market conditions, or in light of NYSE Arca rules and procedures, for reasons that, in view of NYSE Arca, make trading in Shares inadvisable. In addition, trading is subject to trading halts caused by extraordinary market volatility pursuant to circuit breaker rules that require trading to be halted for a specific period based on a specific market decline. There can be no assurance that the requirements necessary to maintain the listing of the Shares will continue to be met or will remain unchanged.

The Lack of Active Trading Markets For the Shares of the Trust May Result in Losses on an Investment in the Trust at the Time of Disposition of Shares.

Although the Shares will be listed and traded on NYSE Arca, there can be no guarantee that an active trading market for the Shares will develop or will be maintained. Even if an active trading market does develop, it may not provide significant liquidity, and the Shares may not trade at prices advantageous to shareholders. If a shareholder wishes to sell Shares at a time when no active market for such Shares exists, the price received for the Shares (assuming that the shareholder is able to sell them) likely will be lower than the price a shareholder would receive if an active market did exist and, accordingly, the shareholder may suffer significant losses.

Shareholders That Are Not Authorized Participants May Only Purchase or Sell Their Shares in Secondary Trading Markets, and the Conditions Associated With Trading in Secondary Markets May Adversely Affect Shareholders Investment in the Shares.

Only Authorized Participants may create or redeem Baskets at a price equal to the NAV of a Basket. In addition to creating or redeeming Baskets directly with the Trust, Authorized Participants may also buy or sell Shares through the secondary market at market prices. In contrast, ordinary shareholders who are not Authorized Participants are limited to secondary market transactions at market prices. Because ordinary shareholders who are not Authorized Participants may not create or redeem Baskets, these shareholders do not have identical arbitrage opportunities that are available to Authorized Participants, and therefore, ordinary shareholders who are not Authorized Participants are subject to the state of the secondary market at the time of a transaction. Ordinary shareholders who are not Authorized Participants may be required to conduct a transaction on the secondary market when conditions are adverse to a shareholders interests, such as when the market price for Shares is lower than the NAV per Share and the ordinary shareholder seeks to sell Shares.

18

The Trusts Acquisition and Sale of bitcoin May Impact the Supply and Demand of bitcoin, Which May Have a Negative Impact on the Price of the Shares.

If the number of bitcoin acquired by the Trust is large enough relative to global bitcoin supply and demand, further creations and redemptions of Shares could have an impact on the supply of and demand for bitcoin in a manner unrelated to other factors affecting the global market for bitcoin. Such an impact could affect the XBX, which would directly affect the price at which Shares are traded on the NYSE Arca or the price of future Baskets created or redeemed by the Trust.

A Possible Short Squeeze Due to a Sudden Increase in Demand for the Shares that Largely Exceeds Supply May Lead to Price Volatility in the Shares.

Bitcoin price speculation may involve long and short exposures. To the extent that aggregate short exposure exceeds the number of Shares available for purchase (for example, in the event that large redemption requests by Authorized Participants dramatically affect Share liquidity), shareholders with short exposure may have to pay a premium to repurchase Shares for delivery to Share lenders. Those repurchases may, in turn, dramatically increase the price of the Shares until additional Shares are created through the creation process. This is often referred to as a short squeeze. A short squeeze could lead to volatile price movements in the Shares that are not directly correlated to the price of bitcoin.

The Trusts Buying and Selling Activity Associated With the Creation and Redemption of Baskets May Adversely Affect an Investment in the Shares.

The Trusts purchase of bitcoin in connection with Basket creation orders may cause the price of bitcoin to increase, which will result in higher prices for the Shares. Increases in the bitcoin prices may also occur as a result of bitcoin purchases by other market participants who attempt to benefit from an increase in the market price of bitcoin when baskets are created. The market price of bitcoin may therefore decline immediately after Baskets are created. Selling activity associated with sales of bitcoin from the Trust in connection with redemption orders may decrease the bitcoin prices, which will result in lower prices for the Shares. Decreases in bitcoin prices may also occur as a result of selling activity by other market participants. If the XBX spot price declines, the trading price of the Shares will generally also decline.

The Inability of Authorized Participants and Market Makers to Hedge Their bitcoin Exposure May Adversely Affect an Investment in the Shares.

Authorized Participants and market makers will generally want to hedge their exposure in connection with Basket creation and redemption orders. To the extent Authorized Participants and market makers are unable to hedge their exposure due to market conditions (e.g., insufficient bitcoin liquidity in the market, inability to locate hedge counterparty, etc.), such conditions may make it difficult to create or redeem Baskets or cause them to not create or redeem Baskets. In addition, the hedging mechanisms employed by Authorized Participants and market makers to hedge their exposure to bitcoin may not function as intended, which may make it more difficult for them to enter into such transactions. Such events could negatively impact the NAV of the Trust and an investment in the Shares.

Difficulties or Limitations in the Processes of Creation and Redemption of Baskets May Interfere with Opportunities for Arbitrage Transactions Intended to Keep the Price of the Shares Closely Linked to the XBX Spot Price, Which May Adversely Affect an Investment in the Shares.

If the processes of creation and redemption of the Shares encounter any unanticipated difficulties, including, but not limited to, the Trusts inability in the future to obtain regulatory approvals for the offer and sale of additional Shares after the present offering is completed, potential market participants who would otherwise be willing to purchase or redeem Baskets to take advantage of any arbitrage opportunity arising from discrepancies between the price of the Shares and the price of the underlying bitcoin may not take the risk that, as a result of those difficulties, they may not be able to realize the profit they expect. If this is the case, the liquidity of Shares may decline and the price of the Shares may fluctuate independently of the XBX spot price and may fall.

In addition, the Sponsor, acting by itself or through the Transfer Agent or the Order Examiner, may postpone, suspend or reject creation or redemption orders, as applicable, for a variety of permitted reasons under certain circumstances. To the extent such orders are postponed, suspended or rejected, the arbitrage mechanism resulting from the process through which Authorized Participants create and redeem Shares

19

directly with the Trust may fail to closely link the price of the Shares to the value of the underlying bitcoin, as measured using the XBX spot price. If this is the case, the liquidity of the Shares may decline and the price of the Shares may fluctuate independently of the XBX spot price and may fall.

Risk Factors Related to bitcoin Exchanges

Disruptions at bitcoin Exchanges and Potential Consequences of a bitcoin Exchanges Failure Could Adversely Affect an Investment in the Shares.

Bitcoin exchanges operate websites on which users can trade bitcoin for U.S. dollars and other government currencies. Trades on bitcoin exchanges are unrelated to transfers of bitcoin between users via the Bitcoin network. Bitcoin trades on exchanges are recorded on the exchanges internal ledger only, and each internal ledger entry for a trade will correspond to an entry for an offsetting trade in U.S. dollars or other government currency. To sell bitcoin on a bitcoin exchange, a user will transfer bitcoin (using the Bitcoin network) from him or herself to the bitcoin exchange. Conversely, to buy bitcoin on a bitcoin exchange, a user will transfer U.S. dollars or other government currency to the bitcoin exchange. After completing the transfer of bitcoin or U.S. dollars, the user will execute his or her trade and withdraw either the bitcoin (using the Bitcoin network) or the U.S. dollars back to the user. Bitcoin exchanges are an important part of the Bitcoin industry.

Bitcoin exchanges have a limited history. Since 2009, several bitcoin exchanges have been closed or experienced disruptions due to fraud, failure, security breaches or distributed denial of service attacks a/k/a DDoS Attacks. In many of these instances, the customers of such exchanges were not compensated or made whole for the partial or complete losses of their funds held at the exchanges. In 2014, the largest bitcoin exchange at the time, Mt. Gox, filed for bankruptcy in Japan amid reports the exchange lost up to 850,000 bitcoin, valued then at over $450 million. Bitcoin exchanges are also appealing targets for hackers and malware. In August 2016, Bitfinex, an exchange located in Hong Kong, reported a security breach that resulted in the theft of approximately 120,000 bitcoin valued at the time at approximately $65 million, a loss which was allocated to all Bitfinex account holders (rather than just specified holders whose wallets were affected directly), regardless of whether the account holder held bitcoin or cash in their account. The potential for instability of bitcoin exchanges and the closure or temporary shutdown of exchanges due to fraud, business failure, hackers, DDoS or malware, or government-mandated regulation may reduce confidence in Bitcoin, which may result in greater volatility in the XBX. In addition, the closure or temporary shutdown of a bitcoin exchange comprising the XBX may result in a loss of confidence in the Trusts ability to determine NAV, which may adversely affect an investment in the Shares.

The Price of bitcoin on bitcoin Exchanges Can Be Volatile and Can Adversely Affect an Investment in the Shares.

The XBX has a limited history. The intra-day price reflects price data sourced from various market data providers. The closing price is based on a methodology that consists of parsing and cleansing actual traded price data from several bitcoin exchanges chosen by TradeBlock. TradeBlock selects which bitcoin exchanges to include in the XBX based on factors determined by TradeBlock. The price of bitcoin on bitcoin exchanges has a limited history. As of January 15, 2017, the eligible bitcoin exchanges selected by TradeBlock include Bitfinex, Bitstamp, GDAX (f/k/a Coinbase), itBit and OKCoin International. The XBX will be calculated on an ongoing basis and published to the NYSE Global Index Feed and made available on a number of market data vendors. The calculation of the XBX as of 4:00 p.m. E.T. on each NYSE Arca trading day will be used for the calculation of the Trusts NAV.

Despite efforts to ensure accurate pricing as per the index methodology, the XBX, and the price of bitcoin generally, remains subject to volatility experienced by the bitcoin exchanges. Such volatility can adversely affect an investment in the Shares.

Momentum Pricing of bitcoin May Subject the XBX Spot Price to Greater Volatility and Adversely Affect an Investment in the Shares.

Momentum pricing typically is associated with growth stocks and other assets whose valuation, as determined by the investing public, accounts for anticipated future appreciation in value. The Sponsor believes that momentum pricing of bitcoin has resulted, and may continue to result, in speculation

20

regarding future appreciation in the value of bitcoin, inflating and making more volatile the value of a bitcoin as represented by the XBX. As a result, bitcoin may be more likely to fluctuate in value due to changing investor confidence in future appreciation in the XBX spot price, which could adversely affect an investment in the Shares.

Risk Factors Related to the XBX

The XBX Methodology May Not Produce the Intended Results.

No assurance can be given that the methodology of the XBX will achieve its goals of tracking the performance of the price of bitcoin.

Shareholders Have No Rights Against TradeBlock

Although TradeBlock may make certain decisions that may negatively affect the existence of the XBX or the performance of the XBX, shareholders will have no rights against TradeBlock. TradeBlock has no obligations relating to this offering or to the shareholders.

TradeBlock Has No Obligation to Consider a Shareholders Interests in Calculating or Revising the XBX.

TradeBlock calculates and maintains the XBX. TradeBlock may add, eliminate or substitute the bitcoin exchanges underlying the index or make other methodological changes that may change the weight of a bitcoin exchange comprising the index. TradeBlock is entitled to exercise limited discretion in relation to the XBX, including, but not limited to, calculating the index levels should an extraordinary event (as provided by the XBX rules) occur. Although TradeBlock is required to make its determinations in good faith, it should be noted that its policies and judgments may have an impact, positive or negative, on the index levels, and in turn, the value of the Shares. Additionally, TradeBlock may alter, discontinue or suspend calculation or dissemination of a bitcoin exchange comprising the index. Any of these actions could adversely affect the value of the Shares. TradeBlock does not have any obligation to take the needs or interests of any parties to transactions involving Shares, including the shareholders, into consideration in taking any such action.

Non-Concurrent Trading Hours Between NYSE Arca and the Various bitcoin Exchanges Comprising the XBX May Impact the Value of an Investment in the Shares.

The value of the Shares may be influenced by non-concurrent trading hours between NYSE Arca and the various bitcoin exchanges comprising the XBX, all of which operate 24 hours. As a result, there will be periods when the NYSE Arca is closed and the bitcoin exchanges continue to trade. Significant changes in the price of bitcoin on exchanges could result in a difference in performance between the value of bitcoin as measured by XBX and the most recent NAV per Share or closing trading price. To the extent bitcoin prices on exchanges move negatively during hours when the NYSE Arca is closed, trading prices on the NYSE Arca may gap down at market open, and shareholders may not be able to sell their Shares until after the gap down has been fully realized, resulting in an inability to mitigate losses in a rapidly negative market. The non-concurrent trading hours also may result in trading spreads and the resulting premium or discount on the Shares widening, increasing the difference between the price of the Shares and the NAV of such Shares.

Historical Performance of the XBX Is Not a Guide to the Future Performance of the Trust.

The XBX launched in April 2014. Past performance of the XBX is limited and not necessarily indicative of the future performance of the XBX. As the Shares of the Trust are designed to reflect as closely as possible the changes, whether positive or negative, in the levels of the XBX, past performance of the XBX is not necessarily indicative of the future performance of the Trust. There can be no guarantee that the performance of the XBX will be positive over any period of time.

The Trusts Performance May Not Always Track the XBX.

The Trusts returns may not match the return of the XBX due to, among other things, disruptions on the bitcoin exchanges comprising the XBX. In addition, the Trust may not replicate exactly the performance of the XBX due to, among other factors, operating expenses incurred by the Trust and an inability to be fully exposed to bitcoin as a result of cash inflows and cash reserves to meet redemptions.

21

The XBX May be Affected by the Sale of Other Exchange Traded Products Tracking the Price of bitcoin.

To the extent exchange traded products other than the Trust tracking the price of bitcoin are formed and represent a significant proportion of demand for bitcoin, large redemptions of the securities of these exchange traded products or private funds holding bitcoin, could negatively affect the XBX and the price and NAV of the Shares.

Operating Risks of the Trust

As the Sponsor and its Management Have No History of Operating an Investment Vehicle Like the Trust, Their Experience May Be Inadequate or Unsuitable to Manage the Trust.

The Sponsor was formed to be the Sponsor of the Trust and has no history of past performance in managing investment vehicles like the Trust. The past performances of the Sponsors management in other positions are no indication of their ability to manage an investment vehicle such as the Trust. If the experience of the Sponsor and its management is inadequate or unsuitable to manage an investment vehicle such as the Trust, the operations of the Trust may be adversely affected.

The Trust Has No Performance History.

The Trust has no operating history. Therefore, a potential shareholder has no performance history, in addition to the historical price of bitcoin, to serve as a factor in evaluating an investment in the Trust.

The Shares of the Trust are New Securities and Their Value Could Decrease if Unanticipated Operational or Trading Problems Arise.

The mechanisms and procedures governing the creation, redemption and offering of the Shares have been developed specifically for the Trust. Consequently, there may be unanticipated problems or issues with respect to the mechanisms of the operations of the Trust and the trading of the Shares, which could have a material adverse effect on an investment in the Shares. In addition, to the extent that unanticipated operational or trading problems or issues arise, the Sponsors past experience and qualifications may not be suitable for solving these problems or issues.

Fees and Expenses are Charged Regardless of Profitability and May Result in Depletion of Assets.

Shareholders in the Trust will pay fees in connection with their investment in Shares, including the Management Fee of [●]% per annum and the bitcoin Insurance Fee of approximately [●]% per annum. The Sponsor will pay the routine operational, administrative and other ordinary fees and expenses of the Trust. The Sponsor will also pay additional fees and expenses. Shareholders are expected to be charged a customary commission by their brokers in connection with purchases of Shares that will vary from shareholder to shareholder. A shareholder may never achieve profits, significant or otherwise, by investing in the Trust. In addition, extraordinary expenses resulting from unanticipated events may become payable by the Trust, which may adversely affect the Shares.

Possibility of Termination of the Trust May Adversely Affect a Shareholders Portfolio.

The Sponsor may terminate the Trust at any time in its sole discretion and will terminate the Trust upon the occurrence of certain events. If this power is so exercised, shareholders who may wish to continue to invest in bitcoin through a fund vehicle will have to find another vehicle, and may not be able to find another vehicle that offers the same features as the Trust. Such detrimental developments could cause a shareholder to liquidate its investments and upset the overall maturity and timing of its investment portfolio.

The Administrator is Solely Responsible for Determining the Value of the bitcoin Held by the Trust, and Any Errors, Discontinuance or Changes in Such Valuation Calculations May Have an Adverse Effect on the Value of the Shares.

The Administrator will determine the NAV of the Trust and the NAV per Share on a daily basis as soon as practicable after 4:00 p.m. E.T. on each day the Shares trade on the NYSE Arca. The Administrators determination is made based on the price set by the XBX or an alternative approach consistent with the Trusts valuation procedures described in Description of the TrustValuation of bitcoin and Computation of Net Asset Value. To the extent that such NAV or NAV per Share is incorrectly calculated, the Administrator may not be liable for any error and such misreporting of valuation data could adversely affect an investment in the Shares.

22

Shareholders May Be Adversely Affected by Redemption Orders That Are Subject to Postponement, Suspension or Rejection Under Certain Circumstances.

The Sponsor may, in its discretion, suspend the right of redemption or postpone the redemption settlement date (1) during any period in which regular trading on NYSE Arca is suspended or restricted, or the NYSE Arca is closed, (2) the order is not in proper form as determined by the Trust, Transfer Agent or Order Examiner, (3) during an emergency as a result of which delivery, disposal or evaluation of bitcoin is not reasonably practicable, or (4) for such other period as the Sponsor determines to be necessary for the protection of shareholders. In addition, the Trust will reject a redemption order if the fulfillment of the order might be unlawful or if, as a result of the redemption, the number of remaining outstanding Shares would be reduced to fewer than the number of Shares in one Basket. Any such postponement, suspension or rejection could adversely affect a redeeming Authorized Participant. For example, the resulting delay may adversely affect the value of the Authorized Participants redemption proceeds if the NAV of the Trust declines during the period of delay. The Trust disclaims any liability for any loss or damage that may result from any such suspension or postponement.

Various Actual and Potential Conflicts of Interest May Be Detrimental to Shareholders.

The Trust will be subject to actual and potential conflicts of interest involving the Sponsor. The Sponsor, its principals and employees, all of whom may be engaged in other investment activities, are not required to devote substantially all of their time to the business of the Trust, which presents the potential for numerous conflicts of interests. These persons may be directors, officers or employees of other entities. They could have a conflict between their responsibilities to the Trust and to those other entities. As a result of these and other relationships, parties involved with the Trust may have a financial incentive to act in a manner other than in the best interests of the Trust and its shareholders. In addition, the Sponsors principals and employees may trade bitcoin for their own accounts. A conflict of interest may exist if their trades are in the same markets and at the same time as the Trust trades. Such trading by the Sponsors principals and employees may increase competition for bitcoin pursued by the Trust, thereby making it more difficult for the Trust to buy and sell bitcoin at favorable prices. A potential conflict also may occur if the Sponsors principals and employees trade their bitcoin more aggressively or take positions in bitcoin that are opposite, or ahead of, the positions taken by the Trust.

Principals and employees of the Sponsor and the Sponsors affiliates have direct investments in bitcoin, and may invest in and trade bitcoin without regard to the interests of the Trust or its shareholders. Any such trading, including principals and employees of the Sponsor and the Sponsors affiliates trading in the Shares, may impact the price of the Shares.

The Sponsor has sole authority to manage the investments and operations of the Trust, and this may allow it to act in a way that furthers its own interests and in conflict with the best interests of the shareholders. Brokers acting on behalf of shareholders in the Trusts sale of Shares are also subject to conflicts of interest. The compensation received by brokers gives them an incentive to promote the sale of Shares as well as to discourage redemptions, which may not be in the best interests of shareholders.

The Sponsor has not established formal procedures to resolve all conflicts of interest and, as a result, the Sponsor could resolve a potential conflict in a manner that is not in the best interest of the Trust or the shareholders. Consequently, shareholders may be dependent on the good faith of the respective parties subject to such conflicts to act in the shareholders best interest. Although the Sponsor attempts to monitor all of these conflicts, it is extremely difficult, if not impossible, for the Sponsor to ensure that these conflicts do not, in fact, result in adverse consequences to the shareholders.

As a Shareholder, You Will Not Have the Rights Normally Associated With Ownership of Shares of Other Types of Investment Vehicles. For Example, You Will Have Extremely Limited Voting Rights in Comparison to Those of Shareholders in Traditional Operating Companies.

Th