SEC Filing Document

Company: T. Rowe Price Active Crypto ETF
Ticker: 
CIK: 2089855
Filing Type: S-1
Document Type: S-1
Date Filed: 2025-10-22
Accession Number: 0001999371-25-015832
Exchange: 
SIC Code: 6221
SIC Description: Commodity Contracts Brokers & Dealers
URL: https://www.sec.gov/Archives/edgar/data/2089855/000199937125015832/activecrypto-s1_102225.htm

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late 2021 and continuing through 2023, crypto asset prices fell sharply, leading to volatility and disruption in the crypto asset markets. Several prominent crypto asset firms such as Celsius Network LLC, Voyager Digital Ltd., and Three Arrows Capital declared bankruptcy. In November 2022, FTX Trading Ltd. (FTX) (a major crypto asset trading platform by volume), and numerous affiliates of FTX filed for bankruptcy, following which U.S. and other regulators began investigations into FTX, and the U.S. Department of Justice brought criminal charges against FTX’s founder and former CEO and others. Several other crypto firms have also declared bankruptcy following the events around FTX, and federal and state regulators in the U.S. have brought charges against a number of crypto firms. These events have adversely affected confidence among participants in the crypto asset markets, and have generated negative publicity and have caused market-wide declines in crypto asset trading prices and liquidity.

Federal and state legislatures and
regulatory agencies are expected to introduce and enact new laws and regulations to regulate crypto asset intermediaries, such as crypto
asset trading platforms and custodians, and in May 2025, the House of Representatives passed the Digital Asset Market Clarity Act, although
this is yet to be passed by the Senate. The U.S. regulators have issued reports and releases concerning crypto assets. However, the extent
and content of any forthcoming laws and regulations are not yet ascertainable with certainty, and it may not be ascertainable in the near
future. It is possible that the Fund may be required to comply with new laws and regulations, which could result in new costs for the
Fund. The Fund may have to devote increased time and attention to regulatory matters, which could increase costs to the Fund. New laws,
regulations and regulatory actions could significantly restrict or eliminate the market for, or uses of, crypto assets including the Eligible
Assets, which could have a negative effect on the value of the Eligible Assets, which in turn would have a negative effect on the value
of the Shares.

These events are continuing to develop
at a rapid pace and it is not possible to predict at this time all of the risks that they may pose to the Sponsor, the Fund, their affiliates
and/or the Fund’s third-party service providers, or to the crypto asset industry as a whole.

Continued disruption and instability
in the crypto asset markets as these events develop, including further declines in the trading prices and liquidity of the Eligible Assets,
could have a material adverse effect on the value of the Shares and the Shares could lose all or substantially all of their value.

Momentum trading of crypto assets
could adversely affect the price of the Eligible Assets, and, in turn, the value of the Shares and an investment in the Fund

Momentum trading is a strategy where
investors buy or sell an asset based on recent price trends of an asset, rather than its fundamental value. Momentum trading typically
is associated with growth stocks and other assets whose valuation, as determined by the investing public, is impacted by appreciation
in value. Crypto assets are subject to momentum trading. Momentum trading may result in speculation regarding future appreciation in the
value of crypto assets, which may inflate prices and lead to increased volatility. As a result, crypto assets may be more likely to fluctuate
in value due to changing investor perceptions regarding future appreciation or depreciation in prices, which could adversely affect the
price of the Eligible Assets, and, in turn, the value of the Shares in the Fund.

The Reference Rates have a limited
performance history and could fail to track the price of the respective crypto asset which could adversely affect the value of the Shares

The Reference Rates were developed
by the Reference Rate Provider and have a limited performance history. A longer history of actual performance through various economic
and market conditions would provide greater and more reliable information for an investor to assess the performance of the Reference Rates.
The crypto trading platforms used in the Relevant Transactions could also change over time. Although the Reference Rates are intended
to accurately capture the market price of the respective crypto assets, third parties may be able to purchase and sell crypto assets on
public or private markets not included among the Relevant Transactions, and such transactions may take place at prices materially higher
or lower than the Reference Rates’ prices. Moreover, there may be variances in the prices of crypto assets on the various crypto
asset platforms, including as a result of differences in fee structures or administrative procedures.

If the Reference Rate is not available,
the Fund’s holdings may be fair valued. To the extent the valuation determined by the Sponsor differs materially from the actual
market price of the crypto assets, the price of the Shares may no longer track, whether temporarily or over time, the global market price
of crypto assets, which could adversely affect an investment in the Fund by reducing investors’ confidence in the Shares’
ability to track the global market price of crypto assets.

Further development and acceptance
of the Eligible Assets is uncertain

The further development and acceptance
of the networks for the Eligible Assets (Eligible Assets Networks) are subject to a variety of factors that are difficult to evaluate.
The slowing, stopping or reversing of the development or acceptance of the Eligible Assets Networks may adversely affect the price of
the Eligible Assets and therefore cause the Fund to suffer losses. Regulatory changes or actions may alter the nature of an investment
in crypto assets or restrict the use of crypto assets or the operations of the Eligible Assets Networks or venues on which the Eligible
Assets trade in a manner that adversely affects the price of the Eligible Assets and, therefore, the Fund’s Shares. The Eligible
Assets are not legal tender and federal, state and/or foreign governments may restrict the use and exchange of the Eligible Assets, and
regulation of the Eligible Assets, both in the United States and elsewhere, is still developing. For example, it may become difficult
or illegal to acquire, hold, sell or use the Eligible Assets in one or more countries, which could adversely impact the price of such
assets, and therefore the value of the Fund’s Shares.

Forks, Airdrops, and Similar Events
in the Eligible Assets Networks could have adverse effects

From time to time, developers of one
or more networks underlying the Eligible Assets may suggest changes to the network. If a sufficient number of users and miners elect not
to adopt the changes, a new crypto asset, operating on the earlier version of the network, may be created. This is often referred to as
a “fork.” For example, in August 2017, bitcoin “forked” into bitcoin and a new crypto asset, Bitcoin Cash, as
a result of a several-year dispute over how to increase the rate of transactions that the Bitcoin Network can process. Since then, bitcoin
has been forked numerous times to launch new crypto assets, such as bitcoin gold, bitcoin silver and bitcoin diamond. Hard forks of one
or more of the networks underlying the Eligible Asset could adversely affect the market for such assets and, therefore, an investment
in the Fund.

Forks may also occur as
a network community’s response to a significant security breach. For example, in June 2016, following a hack of the DAO, a
distributed autonomous organization, most participants in the Ethereum community elected to adopt a “fork” that
effectively reversed the hack; however, a minority of users continued to develop the original blockchain, referred to as
“Ethereum Classic.” A fork may also occur as a result of an unintentional or unanticipated software flaw in the various
versions of otherwise compatible software that users run. Such a fork could lead to users and validators abandoning the crypto asset
with the flawed software. It is possible, however, that a substantial number of users and validators could adopt an incompatible
version of the crypto asset while resisting community-led efforts to merge the two chains. This could result in a permanent fork, as
in the case of Ethereum Network and Ethereum Classic.

Furthermore, a hard fork can lead to
new security concerns, for example, also, during the DAO attack an Ethereum trading platform announced in July 2016 that it had lost 40,000
Ethereum Classic, worth about $100,000 at that time, as a result of “replay attacks,” in which transactions from one network
were rebroadcast on the other network. Another possible result of a hard fork is an inherent decrease in the level of security due to
significant amounts of validating power remaining on one network or migrating instead to the new forked network. After a hard fork, it
may become easier for an individual validator or validating pool’s validating power to exceed 50% of the validating power of a crypto
asset network that retained or attracted less validating power, thereby making crypto asset networks that rely on PoS more susceptible
to attack.