10-Q: CoinShares Bitcoin ETF Q3 2025: NAV Rises Amid Bitcoin Gains

CoinShares Bitcoin ETF reports a 6.9% increase in Net Asset Value per Share for Q3 2025, driven by a 7.0% appreciation in Bitcoin value, despite a decrease in total net assets year-to-date.

Summary

• Net Asset Value (NAV) per Share increased by 6.9% to $32.31 in Q3 2025, up from $30.22 at June 30, 2025.
• Bitcoin's value appreciated by 7.0% during Q3 2025, from $106,930 at June 30, 2025, to $114,394 at September 30, 2025.
• Total net assets decreased from $826,115,990 at December 31, 2024, to $682,460,646 at September 30, 2025.
• The decrease in total net assets year-to-date was primarily due to a significant net redemption of 10,140,000 shares, totaling $251,511,629, during the nine months ended September 30, 2025.
• Net income for Q3 2025 was $43,327,647, with net income per share of $2.08.
• For the nine months ended September 30, 2025, net income was $107,856,285, with net income per share of $4.64.
• The Trust redeemed 745,000 shares in Q3 2025 at an average price of $31.78 per share.
• The annual Sponsor Fee rate remains at 0.25% of the Trust's bitcoin holdings.

Sentiment

Score: 6

Explanation: While the underlying asset (Bitcoin) performed well in Q3 2025, leading to a strong increase in NAV per share and net income, the significant net redemptions and decrease in total net assets and shares outstanding year-to-date indicate a negative trend in investor inflows for this specific ETF. The positive per-share performance is offset by the reduction in overall fund size.

Positives

• Net Asset Value per Share increased by 6.9% in Q3 2025, from $30.22 to $32.31.
• Bitcoin's value appreciated by 7.0% during Q3 2025, from $106,930 to $114,394.
• Net income for Q3 2025 was $43,327,647, significantly higher than $12,632,292 in Q3 2024.
• Net income per share for Q3 2025 was $2.08, a substantial increase from $0.41 in Q3 2024.
• Total return at NAV for Q3 2025 was 6.92%, compared to 2.39% in Q3 2024.
• Total return at market value for Q3 2025 was 6.10%, compared to 5.83% in Q3 2024.
• Disclosure controls and procedures were deemed effective as of September 30, 2025.

Negatives

• Total net assets decreased from $826,115,990 at December 31, 2024, to $682,460,646 at September 30, 2025.
• The number of shares issued and outstanding decreased significantly from 31,260,000 at December 31, 2024, to 21,120,000 at September 30, 2025.
• Net redemptions for the nine months ended September 30, 2025, totaled 10,140,000 shares, valued at $251,511,629.
• The Trust experienced a net change in unrealized loss on investment of $16,289,482 for the nine months ended September 30, 2025, compared to a net change in unrealized gain of $19,227,215 for the same period in 2024.
• Bitcoin holdings decreased from 8,849 at December 31, 2024, to 5,967 at September 30, 2025.

Risks

• General economic, market, and business conditions, including those affecting bitcoin and the Shares.
• Disruptions in computer systems and data centers, and the quality of new technology platforms used by the Trust and its vendors.
• Changes in laws or regulations, including tax laws, made by governmental authorities or regulatory bodies.
• Costs and effects of any litigation or regulatory investigations.
• Ability to maintain a positive reputation.
• Other world economic and political developments.
• No assurance that the Trust will achieve its investment objective.
• The Sponsor is authorized to substitute an alternative index or valuation methodology for bitcoin at its sole discretion without Shareholder approval.

Future Outlook

The Trust's future performance is subject to various risks and uncertainties, including general economic and market conditions for bitcoin, technological disruptions, regulatory changes, litigation, and geopolitical developments. The Sponsor does not undertake an obligation to update forward-looking statements. The Trust's investment objective is to reflect the performance of the CME CF Bitcoin Reference Rate New York Variant, less liabilities and expenses, but there is no assurance this objective will be achieved.

Management Comments

• "The Trust maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in its 1934 Act reports is recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms."
• "Based on this evaluation, the Principal Executive Officer and the Chief Financial Officer of the Sponsor concluded that, as of the end of the period covered by this Quarterly Report on Form 10-Q, the Trust's disclosure controls and procedures were effective."
• "The Sponsor believes the risk of loss under these arrangements [indemnifications] to be remote."

Industry Context

The performance of the CoinShares Bitcoin ETF is directly tied to the value of Bitcoin, as its investment objective is to reflect the performance of the CME CF Bitcoin Reference Rate New York Variant. The reported appreciation of Bitcoin by 7.0% in Q3 2025 indicates a positive trend in the broader cryptocurrency market during that period, which directly benefited the ETF's NAV per share. However, the significant net redemptions suggest a shift in investor sentiment or capital allocation away from this specific ETF, potentially towards other Bitcoin investment vehicles or direct Bitcoin holdings, despite the underlying asset's price increase.

Comparison to Industry Standards

• The Trust's expense ratio of 0.25% is competitive within the Bitcoin ETF market, aligning with or being lower than some other spot Bitcoin ETFs launched in the US, such as BlackRock's IBIT and Fidelity's FBTC which also have expense ratios of 0.25% (with waivers).
• The CME CF Bitcoin Reference Rate New York Variant, used by the Trust, is designed based on IOSCO Principles for Financial Benchmarks and is a Registered Benchmark under UK Benchmark Regulations, indicating adherence to recognized standards for cryptocurrency valuation.
• The Trust's structure as an exchange-traded fund issuing shares in Baskets of 5,000 shares to Authorized Participants is standard for spot Bitcoin ETFs, comparable to offerings from Grayscale, BlackRock, and Fidelity.

Management Changes

Corporate Governance

Legal Proceedings

• None mentioned in the filing.

Related Party Transactions

• Officers of the Trust are affiliated with the Sponsor and are not paid fees by the Trust.
• The Initial Sponsor waived $156,867 in Sponsor fees for the nine months ended September 30, 2024.
• Valkyrie Funds LLC, an affiliate of the Initial Sponsor, purchased 40,000 Shares for $520,000 on January 10, 2024.
• CoinShares Capital Markets (Jersey) Limited, an affiliate of the current Sponsor, served as a Bitcoin Trading Counterparty and fulfilled approximately $295 million in purchase orders before March 15, 2024.
• Affiliates of the Sponsor owned 18,140,000 Shares of the Trust as of September 30, 2025.

Stakeholder Impact

• Shareholders experienced a 6.9% increase in NAV per share in Q3 2025, but the overall fund size (total net assets and shares outstanding) decreased significantly year-to-date due to redemptions.
• The Sponsor (CoinShares Co.) continues to earn a 0.25% annual fee on the Trust's bitcoin holdings and assumes most operational expenses, benefiting from the fund's assets.
• Authorized Participants continue to facilitate creations and redemptions of Baskets, earning fees for their services.
• Custodians (Coinbase Custody Trust Company, LLC, BitGo Trust Company, Inc., and Komainu (Jersey) Limited) provide secure storage for the Trust's bitcoin holdings.

Next Steps

• Continue to monitor general economic, market, and business conditions, especially those affecting bitcoin.
• Manage the Trust's operations, including technology systems and vendor relationships.
• Monitor changes in laws or regulations, including tax laws.
• Address any potential litigation or regulatory investigations.
• Maintain the Trust's positive reputation.

Key Dates

Recommendation

The ETF's per-share performance is directly tied to Bitcoin's price, which showed strong appreciation in Q3 2025. This indicates a healthy underlying asset. However, the significant net redemptions and decrease in total assets year-to-date suggest a lack of sustained investor interest or a shift in capital away from this particular ETF. While the underlying asset's performance is positive, the fund's shrinking size is a concern. A "hold" recommendation is appropriate, advising investors to monitor future redemption trends and Bitcoin price movements before making further investment decisions.

Keywords

Bitcoin ETF, BRRR, CoinShares, Cryptocurrency, Digital Assets, Investment Fund, SEC Filing, Quarterly Report, Financial Results, Net Asset Value, Bitcoin Price, Exchange Traded Fund