Company: DEFI
Filing Date: 2025-02-21
Form Type: POS AM
Source: 0001839882-25-010345
Chunk: 117

Company: Tidal Commodities Trust I
Filing Date: 2025-02-21
Form: POS AM
Chunk 117
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 futures
contracts and sell physical bitcoin, while the LP on the other side of the transaction will sell futures contracts and buy physical
bitcoin.

In order to ensure best execution and ensure
that transactions are executed at commercially reasonable prices when the Fund needs to purchase or sell spot bitcoin, the Sponsor
will conduct a Request-for-Quote (“RFQ”) auction with multiple LPs using the current day settlement price as the reference
for the Futures Contracts. The Sponsor may use electronic means such as the Directed Request for Quote (DRFQ) available in the
CME Direct, chat services or any other communication mechanism that is compatible with CME’s and CFTC guidance around recordkeeping
of EFP transactions. The LPs will present their quotes in terms of basis points (1 bps = 0.01%) difference between the current
day’s settlement price of the futures contract and bitcoin. The Fund will then confirm the trade with the LP that offered
the best quote. After the CME publishes the daily settlement price of the relevant Futures Contract, the Sponsor and the selected
LP calculate and confirm the price of the futures leg of the transaction as being the published settlement price and the price
of physical bitcoin leg of the transaction by applying the agreed upon basis spread and submit the transaction to one of its FCMs
that subsequently reports the transaction to the CME.

After the EFP Transaction is confirmed by
the CME, the futures leg of the transaction is cleared by CME Clearing, while the physical leg is settled bilaterally with the
LP depositing in the Fund’s Wallet with the Bitcoin Custodian the agreed upon amount of bitcoin until the end of day New
York time of the business day following the transaction date prior to any movement of cash from the Cash Custodian. Upon receipt
of the required amount of bitcoin, the Bitcoin Custodian will notify the Sponsor that the bitcoin has been received. The Sponsor
will then notify the Cash Custodian to transfer the corresponding cash to the LP to complete the settlement of the physical leg
of the EFP Transaction. All purchases or sales of bitcoin related to EFP Transactions executed by the Fund are settled on-chain.

<div align='center'>69</div>

The diagram below illustrates the steps
in the execution of a typical EFP transaction by the Fund to acquire physical bitcoin in exchange for Bitcoin Futures Contracts.

To provide a more concrete
example of an EFP transaction that the Fund would undertake to acquire spot bitcoin, assume that the Fund needs to buy