Company: HODL
Filing Date: 2025-03-26
Form Type: 10-K
Source: 0000930413-25-000995
Chunk: 67

Company: VanEck Bitcoin ETF
Filing Date: 2025-03-26
Form: 10-K
Item: Item 1
Chunk 67
---
 and other digital
asset markets. Stablecoins are digital assets designed to have a stable value over time as compared to typically volatile digital
assets, and are typically marketed as being pegged to a fiat currency, such as the U.S. dollar, at a certain value. Although the
prices of stablecoins are intended to be stable, their market value may fluctuate. This volatility has in the past apparently
impacted the price of bitcoin. Stablecoins are a relatively new phenomenon, and it is impossible to know all of the risks that
they could pose to participants in the bitcoin market. In addition, some have argued that some stablecoins, particularly Tether,
are improperly issued without sufficient backing in a way that, when the stablecoin is used to pay for bitcoin, could cause artificial
rather than genuine demand for bitcoin, artificially inflating the price of bitcoin, and also argue that those associated with
certain stablecoins may be involved in laundering money. On February 17, 2021 the New York Attorney General entered into an agreement
with Tether’s operators, including Bitfinex, requiring them to cease any further trading activity with New York persons
and pay $18.5 million in penalties for false and misleading statements made regarding the assets backing Tether (the “NYAG
Settlement Order”). The NYAG Settlement Order states that Bitfinex and Tether are under common ownership and management.
Among other things, the NYAG Settlement Order asserts that Tether’s operators made a series of loans of some of the fiat
currency reserves backing Tether stablecoins to Bitfinex, which Bitfinex used in its business, including to bridge liquidity difficulties
it faced after Bitfinex lost a substantial amount of customer cash due to the actions of a payment processor it employed. In return,
Bitfinex gave Tether a receivable promising to pay the funds back. The NYAG Settlement Order finds, among other things, that representations
Tether’s operators made that each Tether stablecoin was backed 1:1 by fiat currency reserves were fraudulent under New York’s
Martin Act, because some of the fiat currency reserves were replaced by a receivable issued by an affiliate (Bitfinex) without
disclosure to the market. On October 15, 2021, the CFTC announced a settlement with Tether’s operators, Tether Holdings
Limited, Tether Operations Limited, Tether Limited, and Tether

40 

International Limited, in which they agreed
to