Company: DEFI
Filing Date: 2025-03-27
Form Type: 424B3
Source: 0001999371-25-003249
Chunk: 108

Company: Tidal Commodities Trust I
Filing Date: 2025-03-27
Form: 424B3
Chunk 108
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, and that
are cleared and margined through a derivatives clearing organization (“DCO”), i.e., a clearing house. Bitcoin Futures
Contacts are financially settled, which means that one party agrees to buy a commodity such as bitcoin from the other party at
a later date at a price and quantity agreed upon when the contract is made, but instead of taking physical delivery of the commodity
at such later date, settlement occurs in a dollar amount that is equivalent to the amount of bitcoin agreed to in the contract.
In market terminology, a party who purchases a futures contract is long in the market and a party who sells a futures contract
is short in the market. The contractual obligations of a buyer or seller may generally be satisfied by financial settlement or
by making an offsetting sale or purchase of an identical futures contract on the same or linked exchange before the designated
date of delivery. The difference between the price at which the futures contract is purchased or sold and the price paid for the
offsetting sale or purchase, after allowance for brokerage commissions, constitutes the profit or loss to the trader.

If the price of the cryptocurrency increases
after the original futures contract is entered into, the buyer of the futures contract will generally be able to sell a futures
contract to close out its original long position at a price higher than that at which the original contract was purchased, generally
resulting in a profit to the buyer. Conversely, the seller of a futures contract will generally profit if the price of the underlying
bitcoin cryptocurrency decreases, as it will generally be able to buy a futures contract to close out its original short position
at a price lower than that at which the original contract was sold. Because the Fund seeks to track the Benchmark directly, the
Fund intends to hold only long positions in bitcoin futures contracts and intends to roll its Bitcoin Futures Contracts prior to
expiration via sales of existing long positions and the acquisition of new long positions as replacements for contracts sold. Futures
contracts are typically traded on futures exchanges (i.e. DCMs) such as the CME, which provide centralized market facilities in
which multiple persons may trade contracts. Members of a particular futures exchange and the trades executed on such exchange are
subject to the rules of that exchange. Futures exchanges and their related clearing organizations (i.e. DCOs) are given reasonable
latitude in promulgating rules and regulations to control and regulate their members.

Trades on a futures exchange are generally
cleared by the DCO, which provides services designed to mutualize or