Osprey Bitcoin Trust

Notes to the Financial Statements (unaudited)*

June 30, 2026

Osprey Bitcoin Trust (the “Trust”) is a Delaware statutory trust that issues shares representing fractional undivided beneficial interests (“Shares”, formerly referred to as “Units”) in its net assets. The assets of the Trust consist primarily of Bitcoin held by a custodian on behalf of the Trust. The Trust seeks to generally reflect the performance of the price of Bitcoin as measured by reference to the CME CF Bitcoin Reference Rate – New York Variant (the “Index”), less the Trust’s expenses and other liabilities. Osprey Funds, LLC (the “Sponsor”) is the sponsor of the Trust; CSC Delaware Trust Company (the “Trustee”) is the trustee of the Trust; Coinbase Custody Trust Company, LLC (the “Bitcoin Custodian”) is the custodian for the Trust’s Bitcoin holdings; U.S. Bank National Association (the “Cash Custodian” and, together with the Bitcoin Custodian, the “Custodians”) is the custodian for the Trust’s cash holdings; and U.S. Bancorp Fund Services, LLC (d/b/a U.S. Bank Global Fund Services) (the “Trust Administrator”, the “Fund Accountant” and the “Transfer Agent”) is the administrator of, the accountant of, and the transfer agent for, the Trust, effective December 19, 2025; Securitize Fund Services, LLC was Trust Administrator prior to U.S. Bancorp Fund Services, LLC. The sub-transfer agent for the Trust (the “sub-Transfer Agent”) is Continental Stock Transfer & Trust Company. The Trust was formed on January 3, 2019, and commenced operations on January 22, 2019. The Trust is governed by the Third Amended And Restated Declaration Of Trust And Trust Agreement dated December 18, 2025 (the “Trust Agreement”), as further amended on January 9, 2026. On August 6, 2025, the Sponsor filed a registration on Form S-1 with the U.S. Securities and Exchange Commission (“SEC”) to register the Trust’s Shares under the Securities Act of 1933, as amended (the “Securities Act”), in connection with the Trust’s conversion to an exchange traded product. The registration statement, as amended, was declared effective on December 18, 2025.

The Sponsor is responsible for the day-to-day administration of the Trust pursuant to the provisions of the Trust Agreement. The Sponsor is responsible for preparing and providing annual reports on behalf of the Trust to investors and is also responsible for selecting and monitoring the Trust’s service providers. As consideration for the Sponsor’s services, the Trust pays the Sponsor a Management Fee as discussed in Notes 2 and 5. Pursuant to agreements between REX Services, LLC (“REX Services”) and the Sponsor, REX Services provides legal, compliance, general administrative, operational, and marketing support to the Sponsor.

The Index is an independently calculated value based on an aggregation of executed trade flow of major Bitcoin spot platforms. The administrator of the Index is CF Benchmarks Ltd.

The Trust has listed the Shares on Nasdaq Stock Market LLC (the “Listing Exchange”) under the symbol “OBTC.” Prior to listing the Shares for trading on the Listing Exchange, the Trust issued Shares pursuant to Regulation D under the Securities Act and the Shares were quoted on OTC Markets Group, Inc.’s OTCQX® Best Marketplace (“OTCQX”) under the ticker symbol “OBTC.”

The Trust is a passive investment vehicle that does not seek to generate returns beyond tracking the price of Bitcoin. This means the Sponsor does not speculatively sell Bitcoin at times when its price is high or speculatively acquire Bitcoin at low prices in the expectation of future price increases. It also means the Trust will not utilize leverage, derivatives, or any similar arrangements in seeking to meet its investment objective. The Trust is not a registered investment company under the Investment Company Act and is not required to register under the Investment Company Act. The Sponsor is not registered with the SEC as an investment adviser and is not subject to regulation by the SEC, as such, in connection with its activities with respect to the Trust. The Trust is not a commodity pool for purposes of the Commodity Exchange Act, and the Sponsor is not subject to regulation by the Commodity Futures Trading Commission (“CFTC”) as a commodity pool operator or a commodity trading advisor in connection with its activities with respect to the Trust.

The unaudited financial statements in this Form 10-Q should be read in conjunction with the audited financial statements and related notes contained in the Trust’s Annual Report on Form 10-K for the year ended December 31, 2025.

The following is a summary of significant accounting policies consistently followed by the Trust in the preparation of these financial statements.

Basis of Presentation

The following is a summary of significant accounting policies consistently followed by the Trust in the preparation of its financial statements. The financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“U.S. GAAP”). The Trust’s financial statements have been prepared using the accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 946, Financial Services — Investment Companies. The Trust qualifies as an investment company for accounting purposes. The Trust is not registered, and is not required to be registered, as an investment company under the Investment Company Act of 1940, as amended.

Certain prior year amounts in the financial statements and notes thereto have been reclassified to conform to the current period presentation.

Use of Estimates

U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts in the financial statements and accompanying notes. Actual results could differ from those estimates and these differences could be material.

Cash

Generally, the Trust does not intend to hold cash, except in connection with cash orders for creations or redemptions of baskets. Cash includes non-interest bearing non-restricted cash with one institution. Cash in a bank deposit account, at times, may exceed U.S. federally insured limits. The Trust has not experienced any losses in such accounts and does not believe it is exposed to any significant credit risk on such bank deposits. In accordance with ASC Topic 230 “Statement of Cash Flows,” the Trust qualifies for an exemption from the requirement to provide a statement of cash flows and has elected not to provide a statement of cash flows.

Investment Transactions and Revenue Recognition

The Trust identifies Bitcoin as an “other investment” in accordance with ASC 946. The Trust considers investment transactions to be the receipt of Bitcoin for Share creations and the delivery of Bitcoin for Share redemptions, or for payment of expenses in Bitcoin. The Trust records its investment transactions on a trade date basis and changes in fair value are reflected as net change in unrealized appreciation or depreciation on investments. Gains and losses realized on sales of investments are calculated using a first in, first out method and will be recognized in the statements of operations in the period in which the sale occurred. Realized gains and losses are recognized in connection with transactions including settling obligations for the Management Fee and other expenses in Bitcoin.

Investments made by the Trust intend to be limited to investments in Bitcoin and cash.

Correction of immaterial error in the prior periods

During the three months ended March 31, 2026, the Trust corrected a previously identified error related to the classification of realized gains and unrealized appreciation on investments in Bitcoin, as well as an understatement of the cost of investment. The error resulted from the application of a last-in, first-out (“LIFO”) cost methodology during the years 2019 through 2021. The correction had no impact on total net assets or results of operations; however, it resulted in an increase to accumulated net realized gain, a corresponding decrease to accumulated net change in unrealized appreciation, and an increase in the cost of investments within the Statements of Assets and Liabilities and Schedule of Investment.

The following table reflects the impact of the correction on the Trust’s previously reported Statements of Assets and Liabilities and Schedule of Investment as of December 31, 2025:

In addition, the Trust recorded an adjustment to correct shares outstanding from 2,940,536 to 2,940,535. The difference was attributable to an immaterial historical rounding discrepancy related to a fractional share.

Management assessed the materiality of the errors using both quantitative and qualitative factors in accordance with SEC Staff Accounting Bulletin (“SAB”) No. 99 (“Materiality”) and SAB 108 “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements” codified in ASC 250 “Accounting Changes and Error Corrections” and concluded these errors were immaterial to all of the previously issued financial statements. Under ASC 250, correcting prior-period financial statements for such immaterial errors does not require previously filed reports to be amended.

These adjustments did not have a material impact on the Trust’s financial position and results of operations.

Segment Reporting

The Trust is deemed to be an individual segment and the Chief Executive Officer of the Sponsor acts as the Trust’s chief operating decision maker (“CODM”). The CODM monitors the operating results of the Trust as a whole and the Trust’s investment objective is pre-determined in accordance with the terms of the Trust Agreement. The financial information in the form of the Trust’s total returns, expense ratios and changes in net assets provided to and reviewed by the CODM is consistent with the information presented in the Trust’s financial statements.

Management Fee

The Trust is expected to pay the remuneration due to the Sponsor (the “Management Fee”). The Management Fee is charged by the Sponsor to the Trust at an annual rate of 0.49% of the daily Net Asset Value of the Trust and payable to the Sponsor monthly in arrears in U.S. dollars.

Historically, the Trust paid the Management Fee in Bitcoin, but upon listing as an exchange traded fund, the Management Fee has begun to be paid in U.S. dollars. When selling Bitcoin to pay expenses, the Sponsor endeavors to sell the exact amount of Bitcoin needed to pay expenses in order to minimize the Trust’s holdings of assets other than Bitcoin.

Trust Expenses

In accordance with the Trust Agreement, the Sponsor shall assume and pay all routine and ordinary administrative and operating expenses of the Trust including the fees of the Trustee, the Trust Administrator, Fund Accountant, Transfer Agent, the Custodians’ fees, listing exchange fees, SEC registration fees, printing and mailing costs, tax reporting fees, audit fees, license fees and ordinary legal fees and expenses. Prior to the Trust’s conversion to an exchange-traded fund structure, routine operating and administrative expenses of the Trust were borne by the Sponsor, except for certain expenses incurred directly by the Trust, including audit fees, index licensing fees, aggregate legal fees in excess of $50,000 annually, custodian fees, and certain extraordinary expenses. Extraordinary expenses included, but were not limited to, taxes and governmental charges, costs associated with extraordinary services performed for the protection of the Trust or its unitholders, indemnification expenses, and fees and expenses related to public trading on OTCQX.

Fair Value Measurements

The Trust’s valuation procedures provide for the designation of the Sponsor to determine the valuation sources and policies to prepare the Trust’s financial statements in accordance with U.S. GAAP. The Trust’s investment in Bitcoin is stated at fair value. To determine the fair value of the Trust’s investment in Bitcoin and the Trust’s net asset value (“NAV”) in accordance with U.S. GAAP, the Trust follows the guidance in ASC 820-10 “Fair Value Measurements,” which outlines the application of fair value accounting. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the “exit price”) in an orderly transaction between market participants at the measurement date.

ASC 820-10 requires the Trust to assume that Bitcoin is sold in its principal market to market participants or, in the absence of a principal market, the most advantageous market. The principal market is the market with the greatest volume and level of activity for Bitcoin, and the most advantageous market is defined as the market that maximizes the amount that would be received to sell the asset or minimizes the amount that would be paid to transfer the liability, after taking into account transaction costs. The principal market is generally selected based on the most liquid and reliable exchange (including consideration of the ability for the Trust to access the specific market, either directly or through an intermediary, at the end of each period). The Sponsor evaluates relevant market activity and periodically reassesses the appropriateness of the principal market. The Trust determined the fair value per Bitcoin using the price provided at 4:00 p.m., New York time, by principal market on June 30, 2026, which represents both the valuation measurement time and the end of the Trust’s reporting period.

U.S. GAAP utilizes a fair value hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are those that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Trust. Unobservable inputs reflect the Trust’s assumptions about the inputs market participants would use in pricing the asset or liability developed based on the best information available in the circumstances.

The fair value hierarchy is categorized into three levels based on the inputs as follows:

Level 1 – Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Trust has the ability to access. Since valuations are based on quoted prices that are readily and regularly available in an active market, these valuations do not entail a significant degree of judgment.

Level 2 – Valuations based on quoted prices in markets that are not active or for which significant inputs are observable, either directly or indirectly.

Level 3 – Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

The availability of valuation techniques and observable inputs can vary by investment. To the extent that valuations are based on sources that are less observable or unobservable in the market, the determination of fair value requires more judgment. Fair value estimates do not necessarily represent the amounts that may be ultimately realized by the Trust.

The investment measured at fair value on a recurring basis and categorized using the three levels of fair value hierarchy consisted of the following as of June 30, 2026, and December 31, 2025:

The following represents the changes in quantity and the respective fair value of Bitcoin for the six months ended June 30, 2026, and year ended December 31, 2025:

Net realized gain on the transfer of Bitcoin to pay the Management Fee and redemptions for the six months ended June 30, 2026, was $30,997,591. Net change in unrealized depreciation on investment in Bitcoin for the six months ended June 30, 2026, was $61,360,882.

Net realized gain on the transfer of Bitcoin to pay the Management Fee, redemptions, and other expenses for the year ended December 31, 2025, was $31,706,586, which includes $31,696,806 net realized gain on investment in Bitcoin, and $9,780 net realized gain resulted from the changes in liabilities denominated in Bitcoin. Net change in unrealized depreciation on investment in Bitcoin for the year ended December 31, 2025, was $43,022,043, which includes net change in unrealized depreciation on investment in Bitcoin of $43,018,187, and $3,856 net unrealized depreciation due to changes in value of liabilities denominated in Bitcoin. The Management Fee payable accrued in Bitcoin is converted into United States dollar amount at the period-end Bitcoin market price. The fluctuations arising from the effect of changes in liabilities denominated in Bitcoin are included with the net realized or net change in unrealized appreciation or depreciation on investment in Bitcoin in the statements of operations.

Prior to December 19, 2025, the Sponsor paid certain expenses on behalf of, and was reimbursed by, the Trust. For the three and six months ended June 30, 2025, the Trust reimbursed the Sponsor the expenses in the amount of $193,761 and $588,511, respectively. Following the Trust’s conversion to an ETF structure, the Sponsor became responsible for substantially all operating expenses of the Trust. Accordingly, no expense reimbursements were recorded during the current period.

For the three months ended June 30, 2026, and June 30, 2025, the Trust incurred Management Fees of $82,912 and $232,290, respectively, and for six months ended June 30, 2026, and June 30, 2025, the Trust incurred Management Fees of $191,403 and $450,397, respectively, which are recorded in the accompanying statements of operations. As of June 30, 2026, and December 31, 2025, there were unpaid Management Fees of $24,197 and $65,248, respectively, which are due to Sponsor and recorded as management fee payable in the accompanying statements of assets and liabilities.

The Trust’s Management Fee is accrued daily and payable to the Sponsor monthly in arrears in U.S. dollars. From inception through November 30, 2025, all Management Fees have been paid in Bitcoin to the Sponsor. Effective December 2025 Management Fees are to be paid in U.S. Dollars.

The aggregate number of Shares owned by related parties was 264,937, valued at $4,988,380 and 264,937, valued at $7,450,974 on June 30, 2026, and December 31, 2025, respectively.

The Trust issues and redeems Shares only in blocks of 10,000 or integral multiples thereof (each, a “Basket”), based on the quantity of Bitcoin attributable to each Share (net of accrued but unpaid Management Fee and any accrued but unpaid expenses or liabilities). These transactions take place in exchange for Bitcoin or cash. Baskets are offered continuously at the index-based net asset value (“Index-based NAV”) per Share for 10,000 Shares. For purposes of creating and redeeming Baskets, the Trust uses an Index-based NAV calculated based on the value of Bitcoin as reflected by the CME CF Bitcoin Reference Rate – New York Variant. The Trust’s NAV, calculated in accordance with U.S. GAAP, is used for financial reporting purposes and may differ from the Index-based NAV. Only registered broker-dealers that become authorized participants by entering into a contract with the Sponsor and the Trustee (“Authorized Participants”) may purchase or redeem Baskets. Shares will be offered to the public from time to time at varying prices that will reflect the price of Bitcoin and the trading price of the Shares on the Listing Exchange at the time of the offer.

The Authorized Participants may deliver Bitcoin or cash to create Shares and receive Bitcoin or cash when redeeming Shares. When purchasing a Basket in exchange for cash, the Trust will create Shares by receiving Bitcoin from a third-party, that is not the Authorized Participant, and the Trust is responsible for selecting the third-party to deliver the Bitcoin. Further, the third-party will not be acting as an agent of the Authorized Participant with respect to the delivery of the Bitcoin to the Trust or acting at the direction of the Authorized Participant with respect to the delivery of the Bitcoin to the Trust. When redeeming a Basket in exchange for cash, the Trust will redeem shares by delivering Bitcoin to a third-party, that is not the Authorized Participant, and the Trust, not the Authorized Participant, is responsible for selecting the third-party to receive the Bitcoin. Further, the third-party will not be acting as an agent of the Authorized Participant with respect to the receipt of the Bitcoin from the Trust or acting at the direction of the Authorized Participant with respect to the receipt of the Bitcoin from the Trust. The third-party will be unaffiliated with the Trust and the Sponsor.

When purchasing a Basket in-kind, in exchange for Bitcoin, Authorized Participants deliver Bitcoin to the Bitcoin Custodian. Upon the Bitcoin Custodian’s receipt of the Bitcoin, the Transfer Agent issues a Basket to the creating Authorized Participant in satisfaction of the creation order. When redeeming Baskets in-kind, in exchange for Bitcoin, the Transfer Agent will redeem the Shares and the Bitcoin Custodian will distribute the resulting Bitcoin to the redeeming Authorized Participant in satisfaction of the redemption order.

For a subscription of Shares, the subscription shall be in the amount of cash needed to purchase the amount of Bitcoin represented by the Basket being created, as calculated by the Administrator. For a redemption of Shares, the Sponsor shall arrange for the Bitcoin represented by the Basket to be sold and the cash proceeds distributed. The amount of Bitcoin is equal to the combined Index-based NAV of the number of Shares included in the Baskets being created (or redeemed) determined as of 4:00 p.m. New York time on the day the order to create or redeem Baskets is properly received. The transfer agent coordinates with the Trust’s custodians in order to facilitate settlement of the Shares.

Shareholders who decide to buy or sell Shares of the Trust will place their trade orders through their brokers and will incur customary brokerage commissions and charges. Shareholders who buy or sell Shares during the day from their broker may do so at a premium or discount relative to the NAV of the Shares of the Trust.

As of June 30, 2026, there were 2,940,535 Shares issued and outstanding.14,836 of the Shares are restricted securities that may not be resold absent registration or an exemption from registration under the Securities Act, and 2,925,699 of the Shares are unrestricted securities. As of December 31, 2025, there were 4,860,535 Shares issued and outstanding.14,836 of the Shares are restricted securities that may not be resold absent registration or an exemption from registration under the Securities Act, and 4,845,699 of the Shares are unrestricted securities.

Activity in the number and value of Shares created and redeemed for the three and six months ended June 30, 2026, and June 30, 2025, are as follows:

The Sponsor and Trustee assert that the Trust is a grantor trust for U.S. federal income tax purposes. Assuming that the Trust is properly treated as a grantor trust, the Trust will not be subject to U.S. federal income tax. Rather, if the Trust is a grantor trust, each beneficial owner of Shares will be treated as directly owning its pro rata Share of the Trust’s assets and a pro rata portion of the Trust’s income, gain, losses and deductions will “flow through” to each beneficial owner of Shares. As such, each shareholder reports his/her allocable share of income, gain, loss, deductions or credits on his/her own income tax return.

Due to the new and evolving nature of digital currencies and the absence of comprehensive guidance with respect to digital currencies, many significant aspects of the U.S. federal income tax treatment of digital currency, such as Bitcoin, are uncertain. It is unclear what guidance on the treatment of digital currency for U.S. federal income tax purposes may be issued in the future. It is possible that any such guidance could have an adverse effect on the prices of digital currency, including on the price of Bitcoin in digital asset platforms, and therefore may have an adverse effect on the value of the Shares.

If the Trust were not properly classified as a grantor trust, the Trust might be classified as a partnership for U.S. federal income tax purposes. However, due to the uncertain treatment of digital assets, including forks, airdrops and similar occurrences for U.S. federal income tax purposes, there can be no assurance in this regard. If the Trust were classified as a partnership for U.S. federal income tax purposes, the tax consequences of owning Shares generally would not be materially different from the tax consequences described herein, although there might be certain differences, including with respect to timing. In addition, tax information reports provided to beneficial owners of Shares would be made in a different form. If the Trust were not classified as either a grantor trust or a partnership for U.S. federal income tax purposes, it would be classified as a corporation for such purposes. In that event, the Trust would be subject to entity-level U.S. federal income tax (currently at the rate of 21%) on its net taxable income and certain distributions made by the Trust to shareholders would be treated as taxable dividends to the extent of the Trust’s current and accumulated earnings and profits. However, due to the uncertain treatment of digital assets for U.S. federal income tax purposes, there can be no assurance in this regard.

In accordance with U.S. GAAP, the Trust has defined the threshold for recognizing the benefits of tax return positions in the financial statements as “more-likely-than-not” to be sustained by the applicable taxing authority and requires measurement of a tax position meeting the “more-likely-than-not” threshold, based on the largest benefit that is more than 50% likely to be realized. Tax positions not deemed to meet the “more-likely-than-not” threshold are recorded as a tax benefit or expense in the current period. As of June 30, 2026, and December 31, 2025, the Trust did not have a liability for any unrecognized tax amounts. However, the Sponsor’s conclusions concerning its determination of “more-likely-than-not” tax positions may be subject to review and adjustment at a later date based on factors including, but not limited to, further implementation guidance, and ongoing analyses of and changes to tax laws, regulations and interpretations thereof.

The Sponsor of the Trust has evaluated whether or not there are uncertain tax positions that require financial statement recognition and has determined thatno reserves for uncertain tax positions related to federal, state and local income taxes existed as of June 30, 2026 and December 31, 2025. The Trust’s 2023, 2024, and 2025 tax returns are subject to audit by federal, state and local tax authorities.

Investment in Bitcoin

The Trust is subject to various risks including market risk, liquidity risk, and other risks related to its concentration in a single asset, Bitcoin. Investing in Bitcoin is currently unregulated, highly speculative, and volatile.

The net asset value of the Trust relates primarily to the value of Bitcoin held by the Trust, and fluctuations in the price of Bitcoin could materially and adversely affect an investment in the Shares of the Trust. Accordingly, a decline in the price of Bitcoin will have an adverse effect on the value of the Shares of the Trust. The price of Bitcoin has a limited history. During such history, Bitcoin prices have been volatile and subject to influence by many factors.

Factors that may have the effect of causing a decline in the price of Bitcoin include negative perception of crypto assets; a lack of stability and standardized regulation in the crypto asset markets; the closure or temporary shutdown of digital asset platforms due to fraud, business failure, security breaches or government mandated regulation; and a loss of investor confidence.

If Bitcoin exchanges continue to experience significant price fluctuations, the Trust may experience losses. Several factors may affect the price of Bitcoin, including, but not limited to, global Bitcoin supply and demand, theft of Bitcoin from global exchanges or vaults, and competition from other forms of digital currency or payment services. The Bitcoin held by the Trust are commingled and the Trust’s Shareholders have no specific rights to any specific Bitcoin. In the event of the insolvency of the Trust, its assets may be inadequate to satisfy a claim by its Shareholders.

There is currently no clearing house for Bitcoin, nor is there a central or major depository for the custody of Bitcoin. There is a risk that some or all of the Trust’s Bitcoin could be lost or stolen. The Trust does not have insurance protection on its Bitcoin which exposes the Trust and its Shareholders to the risk of loss of the Trust’s Bitcoin. Further, Bitcoin transactions are irrevocable. Stolen or incorrectly transferred Bitcoin may be irretrievable. As a result, any incorrectly executed Bitcoin transactions could adversely affect an investment in the Trust.

To the extent private keys for Bitcoin addresses are lost, destroyed or otherwise compromised and no backup of the private keys are accessible, the Trust may be unable to access the Bitcoin held in the associated addresses and the private keys will not be capable of being restored. The processes by which Bitcoin transactions are settled are dependent on the Bitcoin peer-to-peer network, and as such, the Trust is subject to operational risk. A risk also exists with respect to previously unknown technical vulnerabilities, which may adversely affect the value of Bitcoin.

The Custodian

The digital assets owned by the Trust are held by the Custodian and secured in a segregated custody account. All digital asset private keys are stored in offline storage, or “cold” storage. “Cold” storage is a safeguarding method by which the private keys corresponding to digital assets are disconnected and/or deleted entirely from the internet. As a result of digital assets being stored in “cold” storage, any withdrawal and subsequent transaction request to the Custodian by the Trust requires up to twenty-four (24) hour prior notice to process. Such time delay between the withdrawal request and processing of the withdrawal may negatively impact the price of the digital asset upon sale.

The Sponsor will not be liable to the Trust, the Trustee or any Shareholder for any action taken or for refraining from taking any action in good faith, or for errors in judgment or for depreciation or loss incurred by reason of the sale of any bitcoin or other assets of the Trust. However, the preceding liability exclusion will not protect the Sponsor against any liability resulting from its own gross negligence, bad faith, or willful misconduct.

The Sponsor and each of its shareholders, members, directors, officers, employees, affiliates, and subsidiaries will be indemnified by the Trust and held harmless against any losses, liabilities or expenses incurred in the performance of its duties under the Declaration of Trust without gross negligence, bad faith, or willful misconduct. The Sponsor may rely in good faith on any paper, order, notice, list, affidavit, receipt, evaluation, opinion, endorsement, assignment, draft, or any other document of any kind prima facie properly executed and submitted to it by the Trustee, the Trustee’s counsel or by any other person for any matters arising under the Declaration of Trust. The Sponsor shall in no event be deemed to have assumed or incurred any liability, duty, or obligation to any Shareholder or to the Trustee other than as expressly provided for in the Declaration of Trust. Such indemnity includes payment from the Trust of the costs and expenses incurred in defending against any indemnified claim or liability under the Declaration of Trust.

The Trustee will not be liable or accountable to the Trust or any other person or under any agreement to which the Trust or any series of the Trust is a party, except for the Trustee’s breach of its obligations pursuant to the Declaration of Trust or its own willful misconduct, bad faith or gross negligence. The Trustee and each of the Trustee’s officers, affiliates, directors, employees, and agents will be indemnified by the Trust from and against any losses, claims, taxes, damages, reasonable expenses, and liabilities incurred with respect to the creation, operation or termination of the Trust, the execution, delivery or performance of the Declaration of Trust or the transactions contemplated thereby; provided that the indemnified party acted without willful misconduct, bad faith or gross negligence.

In the normal course of business, the Trust may enter into contracts that contain a variety of general indemnification clauses. The Trust’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trust which have not yet occurred and cannot be predicted with any certainty. However, the Sponsor believes the risk of loss under these arrangements to be remote.

An individual Shareholder’s return, ratios, and per Share performance may vary from these presented above based on the timing of Share transactions. Total return and ratios to average net asset value are calculated for the Shareholders taken as a whole.