Company: HODL
Filing Date: 2025-11-13
Form Type: 10-Q
Source: 0000930413-25-003438
Chunk: 38

Company: VanEck Bitcoin ETF
Filing Date: 2025-11-13
Form: 10-Q
Item: Part I, Item 1
Chunk 38
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 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 digital asset business activities constitute money
transmission requiring licensure.

The inconsistency in applying money transmitting licensure requirements
to certain businesses may make it more difficult for these businesses to provide services, which may affect consumer adoption of
bitcoin and its price. In an attempt to address these issues, the Uniform Law Commission passed a model law in July 2017, the Uniform
Regulation of Virtual Currency Businesses Act, which has many similarities to the BitLicense and features a multistate reciprocity
licensure feature, wherein a business licensed in one state could apply for accelerated licensure procedures in other states. It
is still unclear, however, how many states, if any, will adopt some or all of the model legislation.

Law enforcement agencies have often relied on the transparency of blockchains
to facilitate investigations. However, certain privacy-enhancing features have been, or are expected to be, introduced to a number
of digital asset networks. If the Bitcoin network were to adopt any of these privacy-enhancing features, these features may provide
law enforcement agencies with less visibility into transaction-level data. Europol, the European Union’s law enforcement
agency, released a report in October 2017 noting the increased use of privacy-enhancing digital assets like Zcash and Monero in
criminal activity on the internet. In May 2022, OFAC banned all U.S. persons from using Blender.io, a digital asset mixing application
that operates on the Bitcoin Blockchain to obfuscate the origin, destination and counterparties of blockchain transactions, by
adding certain digital asset wallet addresses associated with Blender.io to its Specially Designated Nationals