Company: HODL
Filing Date: 2025-03-26
Form Type: 10-K
Source: 0000930413-25-000995
Chunk: 258

Company: VanEck Bitcoin ETF
Filing Date: 2025-03-26
Form: 10-K
Item: Item 1A
Chunk 258
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”)
discussing certain aspects of “convertible virtual currency” (that is, digital currency that has an equivalent value in fiat
currency or that acts as a substitute for fiat currency) for U.S. federal income tax purposes and, in particular, stating that such digital
currency (i) is “property” (ii) is not “currency” for purposes of the rules relating to foreign currency gain
or loss and (iii) may be held as a capital asset. In 2019, the IRS released a revenue ruling and a set of “Frequently Asked Questions”
(the “Ruling & FAQs”) that provide some additional guidance, including guidance to the effect that, under certain
circumstances, hard forks of digital currencies are taxable events giving rise to ordinary income and guidance with respect to the determination
of the tax basis of digital currency. However, the Notice and the Ruling & FAQs do not address other significant aspects of the
U.S. federal income tax treatment of digital assets. Moreover, although the Ruling & FAQs address the treatment of hard forks,
there continues to be uncertainty with respect to the timing and amount of the income inclusions.

Future developments that may arise with respect
to digital assets may increase the uncertainty with respect to the treatment of digital assets for U.S. federal income tax purposes. For
example, the Notice addresses only digital currency that is “convertible virtual currency,” and it is conceivable that, as
a result of a fork, airdrop or similar occurrence, the Trust will hold certain types of digital assets that are not within the scope of
the Notice.

There can be no assurance that the IRS will not
alter its position with respect to digital assets in the future or that a court would uphold the treatment set forth in the Notice and
the Ruling & FAQs. It is also unclear what additional guidance on the treatment of digital assets for U.S. federal income tax
purposes may be issued in the future. Any future guidance on the treatment of digital assets for U.S. federal income tax purposes could
increase the expenses of the Trust and could have an adverse effect on the prices of digital currencies, including on the price of bitcoin
in the digital asset markets. As a result, any such future guidance could have an adverse effect on the value of the Shares.

Shareholders are urged to consult their tax advisers
regarding the tax consequences of owning and disposing of Shares and digital assets in general.

70

Future developments regarding the treatment