Company: HODL
Filing Date: 2025-03-26
Form Type: 10-K
Source: 0000930413-25-000995
Chunk: 57

Company: VanEck Bitcoin ETF
Filing Date: 2025-03-26
Form: 10-K
Item: Item 1
Chunk 57
---
Electricity usage.

Digital asset mining operations can consume
significant amounts of electricity, which may have a negative environmental impact and give rise to public opinion against allowing,
or government regulations restricting, the use of electricity for mining operations. Additionally, miners may be forced to cease
operations during an electricity shortage or power outage, or if electricity prices increase where the mining activities are performed.
This could adversely affect the price of bitcoin, or the operation of the Bitcoin network, and accordingly decrease the value
of the Shares.

Concerns have been raised about the electricity
required to secure and maintain digital asset networks. Although measuring the electricity consumed by this process is difficult
because these operations are performed by various machines with varying levels of efficiency, the process consumes a significant
amount of energy. The operations of the Bitcoin network and other digital asset networks may also consume significant amounts
of energy. Further, in addition to the direct energy costs of performing calculations on any given digital asset network, there
are indirect costs that impact a network’s total energy consumption, including the costs of cooling the machines that perform
these calculations. Other methods of achieving transaction validation and security on digital asset networks, such as so-called
“proof-of-stake” consensus mechanisms used by competing digital asset networks, may be more energy efficient or use
less electricity to achieve transaction validation and consensus on the network than the “proof-of-work” consensus
mechanism used by the Bitcoin Blockchain. If users, developers, and miners adopt such competing digital asset networks rather
than the Bitcoin Blockchain due to the perceived advantages in terms of energy usage of such networks and their consensus mechanisms,
the value of the Shares could be adversely impacted.

Driven by concerns around energy consumption
and the impact on public utility companies, various states and cities have implemented, or are considering implementing, moratoriums
on mining activity in their jurisdictions. A significant reduction in mining activity as a result of such actions could adversely
affect the security of the Bitcoin network by making it easier for a malicious actor or botnet to manipulate the relevant blockchain.
If regulators or public utilities take action that restricts or otherwise impacts mining activities, such actions could result
in decreased security of a digital asset network, including the Bitcoin network, and consequently adversely impact the value of
the Shares.

Risks Associated with the Digital Asset
Markets

The value of the Shares relates directly
to the value of bitcoins, the value of which may be highly volatile and subject to fluctuations due to a number of factors. 

34 

The