Company: DEFI
Filing Date: 2025-03-25
Form Type: POS AM
Source: 0001999371-25-003118
Chunk: 119

Company: Tidal Commodities Trust I
Filing Date: 2025-03-25
Form: POS AM
Chunk 119
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 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.

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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 are stored on the blockchain,
which serves as the decentralized transaction ledger for the Bitcoin Network. All transactions, including the creation of new bitcoins
through mining, are recorded on the blockchain, ensuring the verification of each bitcoin’s location in specific digital
wallets (“Bitcoin Account”).

The responsibility for safekeeping all the
bitcoin owned by the Fund in a multi-layer, multi-party cold storage or similarly secure technology, and maintaining the Bitcoin
Account, lies with the Bitcoin Custodian. The digital wallets can be accessed using their respective private keys, which are held
by the Bitcoin Custodian in cold storage at various vaulting locations. The locations of these vaulting premises are kept confidential
to enhance security. The Bitcoin Custodian is authorized to accept bitcoin on behalf of the Fund from pre-approved trading counterparties
accounts, transferring them to the Bitcoin Account, and then depositing them into digital wallets with existing keys in cold storage.
When the Fund needs to withdraw bitcoins