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

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be the subject of negative publicity. Because DeFi applications may be built on the BNB Chain and represent a significant source of demand for BNB, public confidence in the BNB Chain itself could be negatively affected, such sources of demand could diminish and the value of BNB could decrease. Similar risks apply to any smart contract or decentralized application, not just DeFi applications. Popular Decentralized Applications Running On BNB May Cease To Operate Or May Migrate To Competing Blockchains, Which May Negatively Impact The Price Of BNB And Make The BNB Chain Less Attractive. Certain decentralized applications currently running on the BNB Chain may cease operations due to regulatory concerns, lawsuits, or a decline in demand. Additionally, such decentralized applications may also migrate away from BNB to an alternative competing blockchain. Validation On the BNB Chain Is Subject to Risks, including Staking Liquidity and Operational Uncertainty on the BNB Chain.

Validation on the BNB Chain requires BNB to be transferred into smart contracts on the underlying blockchain networks not under the Trust's or anyone else's control. If the BNB Chain source code or protocol fail to behave as expected, suffer cybersecurity attacks or hacks, experience security issues, or encounter other problems, such assets may be irretrievably lost. In addition, the BNB Chains dictate requirements for participation in validation activity, and may impose penalties, if the relevant activities are not performed correctly. The BNB Chain sanction (i.e., "slashing") is imposed if a validator commits malicious acts related to the validation of blocks with invalid transactions. [On the BNB Chain, slashing generally operates by social consensus, rather than being automatically hardwired into the protocol's code. The BNB community generally aspires to slash 100% of staked assets in cases where a BNB node is maliciously trying to violate safety rules and 0% during routine operation. There is currently no automatic slashing in the BNB Chain. Rather, for regular consensus, after a safety violation, the BNB Chain will halt. The validators will analyze the data prior to the halt and figure out who was responsible and propose that the stake of the malicious actors responsible for the safety violation should be slashed after restart, typically 100%. Separately, as part of the "activating" and "de-activating" or "cooling down" processes of staking, staked BNB will be inaccessible for a variable period of time determined by a range of factors, resulting in potential inaccessibility during those periods. "Activation" is the funding of a validator to be included in the active set, thereby allowing the validator to participate in the BNB Chain's proof-of-stake consensus protocol. "De-activating" is the request to exit from the active set and no longer participate in the BNB Chain's proof-of-stake consensus protocol. As part of these "activating" and "de-activating" processes of staking on the BNB Chain, any staked BNB will be inaccessible for a period of time, as the duration of activating and exiting periods are dependent on a range of factors. This can also be longer depending on network conditions and the total amount of BNB being un-staked globally. As a result, the Trust may not be able to promptly access or liquidate staked BNB to meet redemption requests in amounts that are greater than the portion of the Trust's BNB that remains un-staked or respond to adverse market conditions. This delay could adversely affect the Trust's liquidity and its ability to fulfil investor redemptions in a timely manner, particularly during periods of heightened market volatility or significant redemption activity.]

The Sponsor is responsible for assessing, managing, and periodically reviewing the Trust's liquidity risk annually. In conducting the liquidity risk assessment, the Sponsor considers all relevant risks, including the Trust's investment strategy and liquidity during normal and stressed conditions, the Trust's holdings of cash and cash equivalents and the "activating" and "de-activating" period involved in the staking process, and determines whether any adjustments to the management of the Trust's liquidity risk are necessary. Potential adjustments may include reducing the proportion of BNB allocated to staking or increasing the amount of BNB kept readily available to meet redemption requests.

The BNB Chain requires the payment of base fees and the practice of paying prioritization fees is common, and such fees can become significant as the amount and complexity of the transaction grows, depending on the degree of network congestion and the price of BNB. Any cybersecurity attacks, security issues, hacks, penalties, slashing events, or other problems could damage validators' willingness to participate in validation, discourage existing and future validators from serving as such, and adversely impact the BNB Chain's adoption or the price of BNB. Any disruption of validation on the BNB Chain could interfere with network operations and cause the BNB Chain to be less attractive to users and application developers than competing blockchain networks, which could cause the price of BNB to decrease. The limited liquidity during the "activation" or "de-activation" processes could dissuade potential validators from participating, which could interfere with network operations or security and cause the BNB Chain to be less attractive to users and application developers than competing blockchain networks, which could cause the price of BNB to decrease.

Operational Cost May Exceed The Award For Validating Transaction, And Increased Transaction Fees May Adversely Affect The Usage Of The BNB Chain.

If transaction confirmation fees become too high, the marketplace may be reluctant to use the BNB Chain. This may result in decreased usage and limit expansion of the BNB Chain in the retail, commercial and payments space, adversely impacting investment in the Trust. Conversely, if the reward for validators or the value of the transaction fees is insufficient to motivate validators, they may cease to validate transactions.

Ultimately, if the awards of new BNB costs of validating transactions grow disproportionately, miners may operate at a loss, transition to other networks, or cease operations altogether. Each of these outcomes could, in turn, slow transaction validation and usage, which could have a negative impact on the BNB Chain and could adversely affect the value of the BNB held by the Trust.

As a result of BNB's fee burning mechanism, the incentives for validators to validate transactions with higher gas fees are reduced, since those validators would not receive those gas fees.

An acute cessation of validator operations would reduce the collective processing power on the BNB Chain, which would adversely affect the transaction verification process by temporarily decreasing the speed at which blocks are added to the blockchain and make the blockchain more vulnerable to a malicious actor obtaining control in excess of the relevant threshold of the processing power on the blockchain. Reductions in processing power could result in material, though temporary, delays in transaction confirmation time. Any reduction in confidence in the transaction verification process or may adversely impact the value of Shares of the Trust or the ability of the Sponsor to operate.

A Large Validator Exit Could Lead To Congestion and Deactivation Delays On The BNB Chain.

The Trust may be adversely affected by delays in deactivating of its staked assets if a large validator [or the Staking Services Provider] initiates a mass exit from the BNB Chain.

A recent incident on the Ethereum blockchain illustrates the potential impact of such events. In September 2025, Kiln, a major staking provider with over $15 billion in assets staked across multiple networks, exited all 51,000 of its Ethereum validators following a security breach involving its API. This decision led to a 150% spike in Ethereum’s validator exit queue, increasing the total queued Ethereum to 2.6 million Ethereum and extending unbonding times on the Ethereum blockchain to over 45 days.

Although BNB’s staking architecture differs from Ethereum’s, similar risks may arise in the event of a large validator exit. A mass exit and withdrawal of staked assets by a major validator or validators could result in congestion in the deactivation queue and delayed deactivation of the Trust's staked BNB. In addition, a mass exit could also lead to disruption of earning staking rewards if there is a prolonged deactivation period, during which staked BNB will not earn any new staking rewards and will not be able to be restaked until the deactivation period ends.

These risks may materially and adversely affect the Trust's ability to maintain liquidity and accurately value its BNB holdings. There can be no assurance that validator-related disruptions will not occur or that their impact will be limited.

Risks Associated with the Digital Asset Markets

Recent Developments In The Digital Asset Economy Have Led To Extreme Volatility And Disruption In Digital Asset Markets, A Loss Of Confidence In Participants Of The Digital Asset Ecosystem, Significant Negative Publicity Surrounding Digital Assets Broadly And Market-Wide Declines In Liquidity.