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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computers controlled by networked software coordinating the actions of the computers) or group of validators acting in concert were to gain control of more than 33% of the total staked ether on the Ethereum Network, a malicious actor could temporarily impede or delay block confirmation or even cause a temporary fork in the blockchain. This is designed to be a temporary risk, as the Ethereum Network’s inactivity leak would be expected to eventually penalize the attacker enough for the chain to finalize again (i.e., the honest majority would be expected to reclaim a 2/3rd stake as the attacker’s stake is penalized). Moreover, it is believed that a 33% attack would not be sufficient to allow a malicious actor to engage in double-spending or fraudulent block propagation. Even without 33% control, however, a malicious actor or botnet could create a flood of transactions in order to slow down the Ethereum Network.

(ii) “>50% attack” where,
if a malicious actor, validator, botnet or group of validators acting in concert were to gain control of more than 50% of the total staked
ether on the Ethereum Network, a malicious actor would be able to gain full control of the Ethereum Network and the ability to manipulate
future transactions on the blockchain, including censoring transactions, double-spending and fraudulent block propagation, potentially
for an extended period or even permanently. In theory, the minority non-attackers might reach social consensus to reject blocks proposed
by the malicious majority attacker, reducing the attacker’s ability to engage in malicious activity, but there can be no assurance
this would happen or that non-attackers would be able to coordinate effectively. Although the malicious actor or botnet would not be able
to generate new tokens or transactions using such control, it could “double-spend” its own tokens (i.e., spend the same tokens
in more than one transaction) and prevent the confirmation of other users’ transactions for so long as it maintained control (over
50%). To the extent that such malicious actor or botnet did not yield its control of the validating power on the Ethereum Network or the
Ethereum community did not reject the fraudulent blocks as malicious, reversing any changes made to the Ethereum Blockchain may not be
possible.

(iii) “>66% attack”
where, if a malicious actor, validator, botnet or group of validators acting in concert were to gain control of more than 66% of the total
staked ether on the Ethereum Network, a malicious actor could permanently and irreversibly manipulate the blockchain, including censorship,
double-spending and fraudulent block propagation. The attacker could finalize their preferred chain without any consideration for the
votes of other stakers and could also revert finalized blocks.

If a malicious actor or botnet obtains
control of a significant percentage of the validating power, or otherwise obtains control over an Eligible Asset Network through its influence
over core developers or otherwise, such actor or botnet could manipulate the network.

Such concentration of validating power
may also arise from activities such as “liquid staking,” a solution that permits holders of certain crypto assets to deposit
them with a liquid staking application, which stakes the deposited crypto assets while issuing the holder a transferable token in exchange.
Such liquid staking applications pose centralization concerns — for example, a single liquid staking application has reportedly
controlled around or in excess of 33% of the total staked ether on the Ethereum Network. In this regard, see “Liquid staking applications
pose centralization concerns, and a single liquid staking application has reportedly controlled around or in excess of 33% of the total
staked ether on the Ethereum Network.”

The attack of a malicious actor may
have an adverse effect on the Eligible Assets Networks and, therefore, on the value of an investment in the Fund.

Crypto assets are subject to cybersecurity
risk

As crypto assets, the Eligible Assets
are subject to cybersecurity risks, including the risk that malicious actors will exploit flaws in its code or structure that will allow
them to, among other things, steal crypto assets held by others, control the blockchain, steal personally identifying information, or
issue significant amounts of assets in contravention of their protocols. The occurrence of any of these events is likely to have a significant
adverse impact on the price and liquidity of the Eligible Assets and therefore the value of an investment in the Fund. Additionally, the
Eligible Assets Networks’ functionality relies on the Internet. A significant disruption of Internet connectivity affecting large
numbers of users or geographic areas could impede the functionality of the Eligible Assets. Any technical disruptions or regulatory limitations
that affect Internet access may have an adverse effect on the Eligible Assets Networks, the price of the Eligible Assets, and the value
of an investment in the Fund.

If the source code or cryptography
underlying an Eligible Asset held by the Fund proves to be flawed or ineffective, malicious actors may be able to steal the Fund’s
assets. In the past, flaws in the source code for crypto assets have been exposed and exploited, including those that exposed users’
personal information and/or resulted in the theft of users’ crypto assets. Several errors and defects have been publicly found and
corrected, including those that disabled some functionality for users and exposed users’ personal information. Discovery of flaws
in, or exploitations of, the source code that allow malicious actors to take or create money in contravention of known network rules have
occurred. In addition, the cryptography underlying a crypto asset could prove to be flawed or ineffective, or developments in mathematics
and/or technology, including advances in digital computing, algebraic geometry and quantum computing, could result in such cryptography
becoming ineffective. In any of these circumstances, if the crypto asset held by the Fund is affected, a malicious actor may be able to
steal the Fund’s crypto assets, which would adversely affect an investment in the Shares. Even if the Fund did not hold the affected
crypto asset, any reduction in confidence in the source code or cryptography underlying asset generally could negatively affect the demand
for the Eligible Assets and therefore adversely affect an investment in the Shares.

Crypto assets are subject to potential
hacking, risk of theft of private keys, and loss of access risks

Due to the nature of private keys,
the Eligible Assets transactions are irrevocable and incorrectly transferred or stolen crypto assets may be irretrievable, and as a result,
any incorrectly executed transaction could adversely affect the price and liquidity of the Eligible Assets, which may indirectly affect
the price of the Fund’s Shares.

The loss or destruction of a private
key required to access the Fund’s crypto assets may be irreversible. The loss of access to the private keys associated with the
Fund’s crypto assets could adversely affect an investment in the Shares. The Eligible Assets are controllable only by the possessor
of both the unique public key and private key or keys relating to the “digital wallet” in which the currency is held. Private
keys must be safeguarded and kept private in order to prevent a third party from accessing the crypto assets while held in such wallet.
To the extent a private key is lost, destroyed or otherwise compromised and no backup of the private key is accessible, the Fund will
be unable to access the assets held in the related digital wallet. Any loss of private keys relating to digital wallets used to store
the Fund’s crypto assets could adversely affect an investment in the Shares.

Competition from central bank digital
currencies (CBDCs) and emerging payments initiatives involving financial institutions could adversely affect the price of other crypto
assets

Central banks in various countries
have introduced digital forms of legal tender (CBDCs). Whether or not they incorporate blockchain or similar technology, CBDCs, as legal
tender in the issuing jurisdiction, could have an advantage in competing with, or replace, the Eligible Assets as a medium of exchange
or store of value. Central banks and other governmental entities have also announced cooperative initiatives and consortia with private
sector entities, with the goal of leveraging blockchain and other technology to reduce friction in cross-border and interbank payments
and settlement, and commercial banks and other financial institutions have also recently announced a number of initiatives of their own
to incorporate new technologies, including blockchain and similar technologies, into their payments and settlement activities, which could
compete with, or reduce the demand for, the Eligible Assets. As a result of any of the foregoing factors, the value of the Eligible Assets
could decrease, which could adversely affect an investment in the Fund.

The potential limitations around
insurance and Shareholders’ limited rights of legal recourse against the Fund, Trustee, Sponsor, Administrator, Cash Custodian and
Crypto Custodian expose the Fund and its Shareholders to the risk of loss