SEC Filing Document

Company: VanEck BNB ETF
Ticker: 
CIK: 2066824
Filing Type: S-1/A
Document Type: S-1/A
Date Filed: 2025-10-30
Accession Number: 0001628280-25-047581
Exchange: 
SIC Code: 6221
SIC Description: Commodity Contracts Brokers & Dealers
URL: https://www.sec.gov/Archives/edgar/data/2066824/000162828025047581/vaneckbnbs-1a1.htm

Chunk 76 of 98
Word Count: 1236
Character Count: 7710

Document Content:

Request, the BNB Custodian shall notify the Confirming Party of the Clearing Request and the relevant information in such Clearing Request. The Trust is responsible for funding its Fiat Account or BNB Account, as applicable, with the Fiat Currency Amount and the Digital Asset Amount, as applicable based on the Clearing Request, in each case prior to the Expiration Time. The Counterparty must fund its applicable account at the BNB Custodian as well. If, prior to the Expiration Time, both the Trust and the Counterparty have funded their applicable account at the BNB Custodian with their respective obligation of the Fiat Currency Amount and the Digital Asset Amount, the BNB Custodian shall (i) transfer the Fiat Currency Amount from the Buyer's [ ] Account to the Seller's [ ] Account and (ii) transfer the Digital Asset Amount from the Seller's [ ] Account to the Buyer's [ ] Account. If

the parties do not fund their respective accounts with the amounts specified in the Clearing Request by the Expiration Time, the Clearing Request will expire and [     ] have no obligations with respect to such Clearing Request.

The Trust acknowledges and agrees that the BNB Custodian is not involved in and does not have any responsibility for any Clearing Transaction, other than as specifically identified in the Clearing Agreement. The BNB Custodian has represented to the Sponsor that it has policies and procedures in place for mitigating conflicts of interest when executing the Trust's orders pursuant to the Clearing Services. Absent gross negligence, willful misconduct or fraud, the BNB Custodian shall not be liable for any loss resulting from a Clearing Request or the use of Clearing Services. Validation and confirmation procedures used by [     ] are designed only to verify the source of Clearing Requests and that each party has met its respective obligations in respect of a Clearing Request and not to detect errors in the content of that Clearing Request or to prevent duplicate Clearing Requests. The Trust is responsible for losses resulting from Clearing Requests provided by it and for any errors made by or on behalf of the Trust, any errors resulting, directly or indirectly, from fraud or the duplication of any Clearing Request by or on behalf of the Trust, or any losses resulting from the malfunctioning of any devices used by the Trust or loss or compromise of credentials used by the Trust to deliver Clearing Requests.

The Trust also agrees and understands that the BNB Custodian may reject, refuse to settle or otherwise not complete any request to settle a Clearing Request through [     ] for any reason necessary to comply with applicable laws and regulations or in connection with its fraud or other compliance controls and systems, and the Trust agrees that the BNB Custodian shall have no liability whatsoever to the Trust, any transaction counterparty or any other party in connection with or arising out of the BNB Custodian rejecting, refusing or otherwise not completing the settlement of a transaction through [     ].

The BNB Custodian will not settle transactions through [     ]: (i) if either party to a Clearing Transaction has not fully funded its applicable account at the BNB Custodian, with the required Fiat Currency Amount or Digital Asset Amount, as applicable, prior to the Expiration Time; (ii) if either party to a Clearing Transaction has not confirmed its acceptance of the Clearing Request to the BNB Custodian prior to the Expiration Time; (iii) if either party to a transaction is not a customer of the BNB Custodian; or (iv) for any other reason as determined by the BNB Custodian in its sole discretion to comply with applicable laws and regulation or in connection with the BNB Custodian's fraud or other compliance controls and systems.

The Additional BNB Custodian

The Additional BNB Custodian for the Trust's BNB holdings is [     ], and the Trust has entered into the Additional BNB Custody Agreement with the Additional BNB Custodian. The Sponsor may, in its sole discretion, add or terminate BNB Custodians. The Sponsor may, in its sole discretion, change the custodian for the Trust's BNB holdings, but it will have no obligation whatsoever to do so or to seek any particular terms for the Trust from other such custodians.

The Additional BNB Custodian will keep custody of all of the Trust's BNB in segregated accounts in the Additional BNB Vault Balance. Trust assets held in the Additional BNB Vault Balance are held in segregated wallets and are not commingled with the assets of the Additional BNB Custodian's other customers.

The Additional BNB Custodian will keep all of the private keys associated with the Trust's BNB held at the Additional BNB Custodian in the Additional BNB Vault Balance in cold storage. Cold storage is a safeguarding method by which the private key(s) corresponding to BNB is (are) generated and stored in an offline manner. Private keys are generated in offline computers or devices that are not connected to the internet so that they are more resistant to being hacked. By contrast, in hot storage, the private keys are held online, where they are more accessible, leading to more efficient transfers, though they are potentially more vulnerable to being hacked.

Cold storage of private keys may involve keeping such keys on a non-networked computer or electronic device or storing the public key and private keys on a storage device or printed medium and deleting the keys from all computers. The Additional BNB Custodian may receive deposits of BNB but may not send BNB without use of the corresponding private keys. Such private keys are stored in cold storage facilities within the United States and Europe, exact locations of which are not disclosed for security reasons. A limited number of employees at the

Additional BNB Custodian are involved in private key management operations, and the Additional BNB Custodian has represented that no single individual has access to full private keys. The Additional BNB Custodian's internal audit team performs periodic internal audits over custody operations, and the Additional BNB Custodian has represented that Systems and Organizational Control ("SOC") attestations covering private key management controls are also performed on the Additional BNB Custodian by an external provider.

The Additional BNB Custodian has adopted the following security policies and practices with respect to BNB held in its hot wallet: hot wallet private keys are managed online within high security environments; the high security environments can only be accessed via limited programmatic access from pre-defined environments; all human access to the environment is exceptional and requires going through additional authentication mechanisms; private keys are stored in an encrypted, non-exportable format in dedicated resources. Operational redundancy is achieved through services being run in a redundant, high availability mode across geographically redundant facilities, accompanied by regular system backups, thus protecting against service disruptions and single points of failure.

[     ] maintains a commercial crime insurance policy of up to $320 million, which is intended to cover the loss of client assets held by [     ], including from employee collusion or fraud, physical loss including theft, damage of key material, security breach or hack, and fraudulent transfer. The insurance maintained by [     ] is shared among all of [     ]'s customers, is not specific to the Trust or to customers holding BNB with the Additional BNB Custodian and may not be available or sufficient to protect the Trust from all possible losses or sources of losses.