Company: HODL
Filing Date: 2025-03-26
Form Type: 10-K
Source: 0000930413-25-000995
Chunk: 182

Company: VanEck Bitcoin ETF
Filing Date: 2025-03-26
Form: 10-K
Item: Item 1A
Chunk 182
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 May 2019, the Bitcoin Cash
network experienced a 51% attack when two large mining pools reversed a series of transactions in order to stop an unknown miner
from taking advantage of a flaw in a recent Bitcoin Cash protocol upgrade. Although this particular attack was arguably benevolent,
the fact that such coordinated activity was able to occur may negatively impact perceptions of the Bitcoin Cash network. Any similar
attacks on the Bitcoin network could negatively impact the value of bitcoin and the value of the Shares.

Although there are no known reports of
malicious activity on, or control of, the Bitcoin network since its early days, it is believed that certain mining pools may have
exceeded the 50% threshold on the Bitcoin network since the Bitcoin blockchain’s genesis block was mined in 2009, and others
have come close. The possible crossing or near-crossing of the 50% threshold indicates a greater risk that a single mining pool
could exert authority over the validation of bitcoin transactions, and this risk is heightened if over 50% of the processing power
on the network falls within the jurisdiction of a single governmental authority. Also, there have been

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reports that two mining pools recently
controlled in excess of 50% of the aggregate mining power on the Bitcoin network and may do so now or in the future. If network
participants, including the core developers and the administrators of mining pools, do not act to ensure greater decentralization
of bitcoin mining processing power, the feasibility of a malicious actor obtaining control of the processing power on the Bitcoin
network will increase, which may adversely affect the value of the Shares. Also, if miners experience financial or other difficulties
on a large scale and are unable to participate in mining activities, whether due to a downturn in the bitcoin market or other
factors, the risks of the Bitcoin network becoming more centralized could increase.

A malicious actor may also obtain control
over the Bitcoin network through its influence over core developers by gaining direct control over a core developer or an otherwise
influential programmer. To the extent that users and miners accept amendments to the source code proposed by the controlled core
developer, other core developers do not counter such amendments, and such amendments enable the malicious exploitation of the
Bitcoin network, the risk that a malicious actor may be able to obtain control of the Bitcoin network in this manner exists.

If miners expend less processing power
on the Bitcoin network, it could increase the likelihood of a malicious actor obtaining control.

Miners ceasing operations would reduce
the