Company: HODL
Filing Date: 2025-11-13
Form Type: 10-Q
Source: 0000930413-25-003438
Chunk: 162

Company: VanEck Bitcoin ETF
Filing Date: 2025-11-13
Form: 10-Q
Item: Part I, Item 4
Chunk 162
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 the price of bitcoin and an investment in the
Shares.

The Office of Foreign Assets Control (“OFAC”) of the U.S.
Department of the Treasury (the “U.S. Treasury Department”) has added digital currency addresses, including addresses
on the Bitcoin Blockchain, to the list of Specially Designated Nationals whose assets are blocked, and with whom U.S. persons are
generally prohibited from dealing. Such actions by OFAC, or by similar organizations in other jurisdictions, may introduce uncertainty
in the market as to whether bitcoin that has been associated with such addresses in the past can be easily sold. This “tainted”
bitcoin may trade at a substantial discount to untainted bitcoin. Reduced fungibility in the bitcoin markets may reduce the liquidity
of bitcoin and therefore adversely affect their price.

In February 2020, then-U.S. Treasury Secretary Steven Mnuchin stated
that digital assets were a “crucial area” on which the U.S. Treasury Department has spent significant time. Secretary
Mnuchin announced that the U.S. Treasury Department is preparing significant new regulations governing digital asset activities
to address concerns regarding the potential use for facilitating money laundering and other illicit activities. In December 2020,
FinCEN, a bureau within the U.S. Treasury Department, proposed a rule that would require financial institutions to submit reports,
keep records, and verify the identity of customers for certain transactions to or

21

from so-called “unhosted” wallets, also commonly referred
to as self-hosted wallets. In January 2021, then U.S. Treasury Secretary nominee Janet Yellen stated her belief that regulators
should “look closely at how to encourage the use of digital assets for legitimate activities while curtailing their use for
malign and illegal activities.”

Under regulations from the New York State Department of Financial Services
(“NYDFS”), businesses involved in digital asset business activity for third parties in or involving New York, excluding
merchants and consumers, must apply for a license, commonly known as a BitLicense, from the NYDFS and must comply with anti-money
laundering, cybersecurity, consumer protection, and financial and reporting requirements, among others. As an alternative to a
BitLicense, a firm can apply for a charter to become a limited purpose trust company under New York law qualified to engage in
certain digital asset business activities. Other states have considered or approved digital asset business activity statutes or
rules, passing, for example, regulations or guidance indicating that certain