SEC Filing Document

Company: VanEck BNB ETF
Ticker: 
CIK: 2066824
Filing Type: S-1
Document Type: S-1
Date Filed: 2025-05-05
Accession Number: 0002066824-25-000002
Exchange: 
SIC Code: 6221
SIC Description: Commodity Contracts Brokers & Dealers
URL: https://www.sec.gov/Archives/edgar/data/2066824/000206682425000002/vaneckbnbetfs-1.htm

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systems to perform necessary business functions, the Trust is susceptible to operational and information security risks. In general, cyber incidents can result from deliberate attacks or unintentional events. Cyber-attacks include, but are not limited to, gaining unauthorized access to digital systems for purposes of misappropriating assets or sensitive information, corrupting data, or causing operational disruption. Cyber-attacks may also be carried out in a manner that does not require gaining unauthorized access, such as causing denial-of-service attacks on websites. Cyber security failures or breaches of one or more of the Trust's service providers (including, but not limited to, MarketVector, the administrator, transfer agent, and the BNB Custodian) have the ability to cause disruptions and impact business operations, potentially resulting in financial losses, the inability of the Shareholders to transact business, violations of applicable privacy and other laws, regulatory fines, penalties, reputational damage, reimbursement or other compensation costs, and/or additional compliance costs.

In addition, substantial costs may be incurred in order to prevent any cyber incidents in the future. The Trust and its Shareholders could be negatively impacted as a result. While the Trust has established business continuity plans, there are inherent limitations in such plans.

The Trust And Its Service Providers Are Subject To Certain Operational Risks.

The Trust and its service providers, including the Sponsor, Administrator, Transfer Agent, BNB Custodian and Cash Custodian (as well as Authorized Participants and market makers) may experience disruptions that arise from human error, processing and communications errors, counterparty or third-party errors, or technology or systems failures, any of which may have an adverse impact on the Trust. Although the Trust and its service providers seek to mitigate these operational risks through their internal controls and operational risk management processes, these measures may not identify or may be inadequate to address all such risks. Additionally, the BNB Custodian, which

was established in [ ], has a limited operating company and experience, which could heighten certain operational risks.

Risk Factors Related to ERISA

In General.

Notwithstanding the commercially reasonable efforts of the Sponsor, it is possible that the underlying assets of the Trust will be deemed to include "plan assets" for the purposes of Title I of ERISA or Section 4975 of the Code. If the assets of the Trust were deemed to be "plan assets," this could result in, among other things, (i) the application of the prudence and other fiduciary standards of ERISA to investments made by the Trust and (ii) the possibility that certain transactions in which the Trust might otherwise seek to engage in the ordinary course of its business and operation could constitute non-exempt "prohibited transactions" under Section 406 of ERISA and/or Section 4975 of the Code, which could restrict the Trust from entering into an otherwise desirable investment or from entering into an otherwise favorable transaction. In addition, fiduciaries who decide to invest in the Trust could, under certain circumstances, be liable for "prohibited transactions" or other violations as a result of their investment in the Trust or as co-fiduciaries for actions taken by or on behalf of the Trust or the Sponsor. There may be other federal, state, local, non-U.S. law or regulation that contains one or more provisions that are similar to the foregoing provisions of ERISA and the Code that may also apply to an investment in the Trust.

The application of ERISA (including the corresponding provisions of the Code and other relevant laws) may be complex and dependent upon the particular facts and circumstances of the Trust and of each Plan, and it is the responsibility of the appropriate fiduciary of each investing Plan to ensure that any investment in the Trust by such Plan is consistent with all applicable requirements. Each Shareholder, whether or not subject to Title I of ERISA or Section 4975 of the Code, should consult its own legal and other advisors regarding the considerations discussed above and all other relevant ERISA and other considerations before purchasing the Shares.

BNB, BNB MARKET, BNB EXCHANGES AND REGULATION OF BNB

This section of the Prospectus provides a more detailed description of BNB.

BNB and the BNB Chain Network

BNB is a digital asset that is created and transmitted through the operations of the peer-to-peer BNB Chain, a network of computers operating on cryptographic protocols and based on open-source software whose infrastructure is collectively maintained by a global user base, including validator node operators and developers contributing to the open-source codebase. The BNB Chain allows users to exchange tokens of value, called BNB, which are recorded on a public transaction ledger known as a blockchain. BNB can be used to pay for goods and services, including transaction fees and computational services on the BNB Chain, or it can be converted to fiat currencies, such as the U.S. dollar, at rates determined on digital asset trading platforms or in peer-to-peer transactions.

Furthermore, the BNB Chain was designed to enable the deployment and execution of smart contracts, which is general-purpose code that executes on every computer in the network and can instruct the transmission of information and value based on a sophisticated set of logical conditions. These smart contracts allow developers and users to build decentralized applications (DApps), create new tokens, facilitate decentralized exchanges, or implement other programmable financial and non-financial operations. Smart contract operations are executed on the BNB Smart Chain (as described below) in exchange for payment of BNB, which serves as the base currency for computational and network activity.

BNB Chain – Overview

The BNB Chain is a Layer 1 blockchain ecosystem developed to support decentralized applications, including smart contracts, digital asset issuance, and blockchain-based financial infrastructure. Originally launched by Binance, a global digital asset exchange, the BNB Chain has evolved into a multiple-chain architecture comprised of the BNB Chain, a Layer 1 blockchain which supports smart contract functionality; opBNB is used as a Layer 2 scaling solution; and BNB Greenfield is used as a blockchain storage solution. The BNB Chain is Ethereum Virtual Machine (EVM)-compatible and supports smart contracts and DApp development. Together, the chains form an integrated system seeking to balance performance, scalability, and decentralization.

The BNB Chain utilizes a consensus mechanism known as proof-of-staked-authority (PoSA), which combines aspects of delegated proof-of-stake and proof-of-authority. Validators are selected based on their BNB holdings and staking activity, and they are responsible for confirming transactions and securing the network. The network's architecture aims to offer lower fees and faster block times compared to other smart contract platforms while maintaining compatibility with the Ethereum Virtual Machine (EVM), allowing developers to port Ethereum-based applications to BSC with minimal modifications.

BNB Chain’s core development has historically been led by contributors affiliated with Binance and other independent developers working under the broader BNB Chain community initiative. Although Binance helped incubate the network and continues to play a role in its development and ecosystem support, BNB Chain operates as an open-source, decentralized, community-driven project.

Smart Contracts and Development on the BNB Chain

Smart contracts are programs that run on a blockchain that can execute automatically when certain conditions are met. Smart contracts facilitate the exchange of anything representative of value, such as money, information, property, or voting rights.

Using smart contracts, users can send or receive digital assets, create markets, store registries of debts or promises, represent ownership of property or a company, move funds in accordance with conditional instructions and create new digital assets.

Development on the BNB Chain involves building more complex tools on top of smart contracts, such as decentralized apps ("DApps") and organizations that are autonomous, known as decentralized autonomous organizations ("DAOs"). For example, a company that distributes charitable donations on behalf of users could hold donated funds in smart contracts that are paid to charities only if the charity satisfies certain pre-defined conditions.

In total, as of December 31, 2024, more than [2,000] DApps are currently built on the BNB Chain, including DApps in the collectible non-fungible token, gaming, music streaming, and decentralized finance categories.

Additionally, the BNB Chain has been used for decentralized finance ("DeFi"), or open finance platforms, which seek to democratize access to financial services, such as borrowing, lending, custody, trading, derivatives and insurance, by removing third-party intermediaries. DeFi can allow users to lend and earn interest on their digital assets, exchange one digital asset for another and create derivative digital assets such as stablecoins, which are digital assets pegged to a reserve asset such as fiat currency. As of December 31, 2024, approximately $[1.42] billion was being used as collateral on DeFi platforms.