Company: HBAR
Filing Date: 2025-09-09
Form Type: S-1
Source: 0000950170-25-113803
Chunk: 207

Company: Grayscale Hedera Trust ETF
Filing Date: 2025-09-09
Form: S-1
Chunk 207
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, if at all. In addition, while the Trust may enter into Staking Arrangements with multiple Staking Providers, the Sponsor anticipates that any such arrangements would be substantively identical in all material respects to the Staking Arrangements described in this prospectus, including, for the avoidance of doubt, the bespoke terms of the Staking Arrangements outlined above. Any material deviation from the Staking Arrangements as described in this prospectus would be disclosed in the Trust’s subsequent filings with the Commission.

Security and Controls

The Trust’s Custodian has multiple layers of security protocols designed to protect the Trust’s assets from unauthorized access or transfer, which will remain in place when the Trust’s HBAR is staked.

The Trust’s HBAR will be staked directly from the Trust’s wallets and will not be transferred to any other wallet to be staked. The Hedera protocol (a) mandates that the executor of the staking transaction (i.e., the Sponsor on behalf of the Trust) can execute the withdraw function at any time through the Trust’s wallets administered by the Custodian and (b) limits the activities of the Staking Provider to executing only those activities specified by the protocol, such as staking, un-staking and performing validation activities. Accordingly, the Staking Provider will not have any control over the Trust’s staked HBAR other than to stake or un-stake HBAR at the direction of the Sponsor. In particular, the Staking Provider will not be authorized to leverage or rehypothecate the Trust’s HBAR tokens. The Staking Provider will also not be able to change the designated wallet addresses on the Hedera Network to which Staking Consideration shall be sent.

In addition, the proposed Staking Arrangements will not alter the Trust’s current custody environment or security procedures. The Sponsor expects that the Staking Arrangements will serve as an addendum to the Custodial Services Agreement between the Trust and the Custodian, and the controls currently in place between the Sponsor and the Custodian will also govern the activities related to staking and un-staking HBAR, as outlined in the Staking Arrangements. These controls and procedures include:

Private Key Management (“Shards”) : The Custodian manages HBAR for the Trust using offline storage, or cold storage, which means that the keys to the Trust’s HBAR are disconnected and/or deleted entirely from the internet. Transfers from the Trust’s wallet require compliance with certain security procedures that will remain in place