Company: HZEN
Filing Date: 2025-02-10
Form Type: 10-Q
Source: 0000950170-25-017070
Chunk: 104

Company: Grayscale Horizen Trust (ZEN)
Filing Date: 2025-02-10
Form: 10-Q
Item: Part I, Item 8
Chunk 104
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15,377 for the three months ended December 31, 2024, which consisted of the net realized and unrealized gain on investment in ZEN, less the Sponsor’s Fee of $56. Net assets increased to $25,713 at December 31, 2024, a 439% increase for the three-month period. The increase in net assets resulted from the aforementioned ZEN price appreciation and the contribution of approximately 307,060 ZEN with a value of $5,569 to the Trust in connection with Share creations during the period, partially offset by the withdrawal of approximately 3,945 ZEN to pay the foregoing Sponsor’s Fee.

Net realized and unrealized gain on investment in ZEN for the three months ended December 31, 2023 was $826, which includes a realized loss of ($41) on the transfer of ZEN to pay the Sponsor’s Fee and net change in unrealized appreciation on investment in ZEN of $867. Net realized and unrealized gain on investment in ZEN for the period was driven by ZEN price appreciation from $7.77 per ZEN as of September 30, 2023, to $9.14 per ZEN as of December 31, 2023. Net increase in net assets resulting from operations was $789 for the three months ended December 31, 2023, which consisted of the net realized and unrealized gain on investment in ZEN, 

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less the Sponsor’s Fee of $37. Net assets increased to $5,460 at December 31, 2023, a 17% increase for the three-month period. The increase in net assets resulted from the aforementioned ZEN price appreciation, partially offset by the withdrawal of approximately 3,776 ZEN to pay the foregoing Sponsor’s Fee.

Cash Resources and Liquidity 

The Trust has not had a cash balance at any time since inception. When selling ZEN, Incidental Rights and/or IR Virtual Currency in the Digital Asset Market to pay Additional Trust Expenses on behalf of the Trust, the Sponsor endeavors to sell the exact amount of ZEN, Incidental Rights and/or IR Virtual Currency needed to pay expenses in order to minimize the Trust’s holdings of assets other than ZEN. As a consequence, the Sponsor expects that the Trust will not record any cash flow from its operations and that its cash balance will be zero at the end of each reporting period. Furthermore, the Trust is not a party to any off-balance sheet arrangements. 

In