Company: HBAR
Filing Date: 2025-09-09
Form Type: S-1
Source: 0000950170-25-113803
Chunk: 133

Company: Grayscale Hedera Trust ETF
Filing Date: 2025-09-09
Form: S-1
Chunk 133
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 Hedera Network and has equal voting rights on governance matters. The Hedera Council membership does not confer any economic interest in Hedera, such as rights to dividends or a share of profits. Other than Swirlds, Inc. (which has a permanent Hedera Council seat), each Hedera Council member is term-limited to two consecutive three-year terms, and members will accordingly rotate on and off the Hedera Council.

The Hedera Council also votes on proposals to upgrade the Hedera Network software and other features, although the source code and protocols for the Hedera Network are capable of being developed in an open- or closed-source environment for distributed applications.

In these ways, the Hedera Council is intended to promote decentralized, transparent, stable, and effective governance on behalf of the long-term interests of the network. In contrast to public blockchain networks, the Hedera Network is not governed by small and/or relatively unknown groups of miners and developers.

Hedera’s “HBAR” Digital Asset

The Hedera Network’s native digital asset, HBAR, serves two purposes. First, it is used as a mechanism to secure the network against cyberattacks through the Hedera Network’s distributed consensus process. Additionally, it provides the “fuel” that incentivizes and pays for the computing resources necessary to enable the Hedera Network.

The Hedera Network was launched in August 2018. At that time, the network’s total fixed supply of HBAR—50 billion HBAR—was minted and placed into a Hedera Treasury account. The Hedera Treasury consists of multiple cryptographically secure, multi-signature accounts. HBAR can be transferred out of a Hedera Treasury account only after a transaction is cryptographically signed by a majority of the Hedera Council members. This ensures that control over the network’s digital asset remains decentralized and vested in large, trustworthy entities.

For more than a year after the network launched, almost all HBAR remained in the Hedera Treasury account, aside from a small amount of HBAR (6.7 million HBAR) distributed to early users to test the network as part of its community testing program. Then, after more than a year of testing, the Hedera Network opened to the public on September 16, 2019, so that anyone could create an account on the Hedera Network, and any developer could build and deploy applications on the network. A few hours after that transition to “open access,” the Hedera Treasury began distributing HBAR to parties that purchased tokens through a simple agreement for future