Company: DEFI
Filing Date: 2025-03-27
Form Type: 424B3
Source: 0001999371-25-003249
Chunk: 116

Company: Tidal Commodities Trust I
Filing Date: 2025-03-27
Form: 424B3
Chunk 116
---
 terms of the EFP, namely: 
 ● Fund sells / LP buys 10 BTC Contracts at $26,060     
 ● Fund buys / LP sells 50 bitcoins at 25,995.01        
 (basis spread of +25bps)                               |                   |
| 3. LP sends bitcoin to the Fund                                                                    | -50 bitcoins                                           | +50 bitcoins      |
| 4. The EFP transaction is reported to CME and the LP assumes the long position in 10 BTC Contracts | +10 BTC Contracts                                      | -10 BTC Contracts |
| 5. Final position                                                                                  | 10 BTC Contracts                                       | 50 bitcoins       |

As an EFP is a privately negotiated off-exchange,
the CME allows it to be executed at a mutually agreed price, but it requires that such price be commercially reasonable. EFP transactions
fall under the governance of CME Exchange Rule 538, stipulating that these transactions must be conducted at commercially reasonable
prices, as mutually agreed upon by the involved parties. According to the CME, EFPs are expected to be executed at market prices.
Consequently, the CME recognizes market prices as inherently reasonable under CME Exchange Rule 538. The Sponsor believes that
by conducting a Request-for-Quote (“RFQ”) auction with multiple LPs it ensures that EFP transactions are executed at
commercially reasonable prices.

All parties to an EFP are required to prepare
and maintain all documents related to both the futures and the corresponding physical bitcoin position, in accordance with CFTC
Regulation 1.35. CME has the authority to obtain records related to EFP transactions and has a surveillance program in place to
appropriately monitor and enforce compliance with its market regulation to prevent fraud and manipulation.

<div align='center'>70</div>

CME’s exchange for related position
transaction rules establish that if prices deviate excessively from prevailing market levels, counterparties to the EFP may be
required to demonstrate that the prices are indeed legitimate and/or provide a justification for the disparity. If parties can
substantiate that the purpose behind the off-market transaction is legitimate and complies with the law, the CME acknowledges and
accepts it as commercially reasonable. Conversely, if parties are unable to provide adequate proof, both the parties and their
corresponding Futures Commission Merchants (FCMs) may be subject to charges in accordance with the provisions outlined in CME Exchange
Rule 406.

Custody of Bitcoin

Bitcoins exist and