10-K/A: VanEck Bitcoin ETF 2025 Annual Report: Growth Amid Volatility

VanEck Bitcoin ETF reports significant asset growth in 2025 despite bitcoin price volatility, with a fee waiver for assets under $2.5 billion.

Summary

• The VanEck Bitcoin ETF (HODL) was formed on December 17, 2020, as a Delaware statutory trust, aiming to reflect bitcoin's price performance less operating expenses.
• The Trust's Net Asset Value (NAV) increased by 7.95% from $1,280,450,332 at December 31, 2024, to $1,382,273,990 at December 31, 2025.
• Outstanding Shares increased from 48,500,000 at December 31, 2024, to 55,900,000 at December 31, 2025.
• The increase in NAV was primarily driven by an increase in outstanding shares, despite a 6.34% decrease in bitcoin's price from $93,349 (Dec 31, 2024) to $87,432 (Dec 31, 2025).
• The NAV per Share decreased by 6.33% from $26.40 (Dec 31, 2024) to $24.73 (Dec 31, 2025), directly reflecting the bitcoin price decline.
• Net decrease in net assets resulting from operations for 2025 was $194,003,212, primarily due to a net unrealized depreciation of $278,761,960 on bitcoin investment.
• The Sponsor Fee of 0.20% of average daily net assets was entirely waived for the first $2.5 billion of assets from November 25, 2025, through July 31, 2026.
• The Trust holds 15,809.70 bitcoin with a fair value of $1,382,273,990 as of December 31, 2025.

Sentiment

Score: 5

Explanation: StockSavvy.ai views this filing as neutral to slightly negative. While the Trust saw asset growth and implemented a fee waiver, the underlying asset (bitcoin) experienced a significant price decline in 2025, leading to unrealized depreciation and a decrease in NAV per share. The regulatory environment remains highly uncertain, posing ongoing risks.

Positives

• Net Asset Value (NAV) increased by 7.95% to $1,382,273,990 at December 31, 2025, from $1,280,450,332 at December 31, 2024.
• Outstanding Shares increased from 48,500,000 to 55,900,000, indicating continued investor interest and capital inflows.
• The Sponsor waived the entire 0.20% Sponsor Fee for the first $2.5 billion of the Trust's assets from November 25, 2025, through July 31, 2026, reducing costs for shareholders.
• Net realized gain on bitcoin sold for redemption of shares was $84,758,748 in 2025.
• The Trust maintains robust cybersecurity policies and procedures, adopting the NIST framework, and has not experienced a material information security breach.
• The SEC and FINRA clarified that broker-dealers are permitted to facilitate in-kind creations and redemptions for spot crypto exchange-traded products as of May 15, 2025, which could improve arbitrage efficiency.

Negatives

• Bitcoin price decreased by 6.34% from $93,349 at December 31, 2024, to $87,432 at December 31, 2025.
• Net Asset Value (NAV) per Share decreased by 6.33% from $26.40 at December 31, 2024, to $24.73 at December 31, 2025.
• Net decrease in net assets resulting from operations for 2025 was $194,003,212, primarily due to a net unrealized depreciation of $278,761,960 on investment in bitcoin.
• The Trust is a passive investment vehicle and does not actively manage to mitigate impacts of bitcoin price volatility.
• The Trust is subject to concentration risk, with substantially all assets in bitcoin, meaning any decline in bitcoin value directly impacts the Trust.
• The Bitcoin network's decentralized governance structure may negatively affect its ability to grow and respond to challenges, potentially leading to forks or reduced utility.
• The Trust will irrevocably abandon any Incidental Rights or IR Virtual Currency (e.g., from forks or airdrops), meaning shareholders will not benefit from these.

Risks

• Extreme volatility in bitcoin trading prices, potentially leading to significant declines in Share value.
• Loss, theft, destruction, or compromise of private keys for digital assets, resulting in permanent loss of assets.
• Irrevocable bitcoin transactions; incorrectly executed or stolen bitcoin may be irretrievable.
• Dependence of digital asset networks on the internet; disruptions could affect transferability and value.
• Refusal of banks and financial institutions to process funds for bitcoin transactions, dampening liquidity and public perception.
• Technical issues, vulnerabilities, and bugs in the Bitcoin network software, potentially exploited by malicious actors.
• Forks in the Bitcoin Blockchain (e.g., Bitcoin Cash), leading to multiple incompatible networks and potential value decline.
• Concentration of bitcoin ownership in a small number of wallets, making the market susceptible to large sales.
• Lack of consensus or clarity on Bitcoin network governance, stymying growth and problem-solving.
• Declining profit margins for bitcoin miners, leading to increased selling of newly mined bitcoin and downward price pressure.
• Significant electricity consumption by mining operations, potentially leading to negative environmental impact and regulatory restrictions.
• Supply chain disruptions for bitcoin mining hardware, affecting network security and transaction confirmation.
• Vulnerability of the Bitcoin Blockchain to a 51% attack, allowing manipulation of transactions.
• Theoretical conjectures underlying blockchain technologies proving incorrect due to mathematical or technological advances (e.g., quantum computing).
• Limited retail and commercial use of bitcoin, contributing to price volatility driven by speculators.
• Increased transaction fees on the Bitcoin network due to block reward reductions or congestion, reducing attractiveness.
• Collusion among miners to raise transaction fees, adversely affecting network usage.
• Competition from central bank digital currencies (CBDCs) and other emerging payment initiatives.
• Impact of stablecoins (e.g., Tether, USDC) and their regulatory treatment on bitcoin prices and market liquidity.
• Risks from "digital asset treasury companies" increasing market volatility or competing with the Trust.
• Competition from new competing digital assets challenging bitcoin's market position.
• Failure of other digital asset funds to receive SEC approval for exchange listings, reducing institutional/retail interest.
• MarketVectorTM Bitcoin Benchmark Rate having a limited history, potential failure to track global bitcoin price, and susceptibility to manipulative practices.
• Discretion of the Sponsor to change the pricing or valuation methodology, potentially affecting Share value.
• Intellectual property rights claims against the Trust, leading to extraordinary expenses or termination.
• Factors unrelated to bitcoin value influencing Share price, such as operational problems, security vulnerabilities, or service provider defaults.
• Market risk, including possible loss of entire principal due to bitcoin price fluctuations.
• Shares trading at a premium or discount to NAV due to non-current trading hours between the Exchange and the 24-hour digital asset market.
• Inability of Liquidity Providers to hedge bitcoin exposure, affecting Share liquidity and value.
• Disruptions in the creation and redemption processes, leading to wider trading spreads and divergence from NAV.
• Transaction costs and slippage associated with cash creations and redemptions, which are higher than in-kind models.
• Limited ability to facilitate in-kind creations and redemptions, potentially impairing liquidity and arbitrage.
• Lack of full insurance for the Trust's bitcoin holdings and limited legal recourse against service providers.
• Loss or failure of critical banking relationships (Cash Custodian, Bitcoin Custodian's banks) affecting operations or causing losses.
• Sponsor's sole responsibility for valuation, with potential for errors or changes in methodology.
• Requirement for the Trust to indemnify service providers, reducing bitcoin holdings.
• Interconnectedness and contagion risks due to service providers (Gemini, Coinbase, Liquidity Providers) also serving competing products.
• Authorized Participants acting for competing products, potentially limiting their participation with the Trust.
• Regulatory uncertainty in digital asset markets, with potential for adverse legislative or regulatory developments (e.g., FinCEN, OFAC, SEC, CFTC actions).
• Potential classification of bitcoin as a security or commodity interest, leading to additional regulatory requirements or liquidation.
• Requirements for money service business or money transmitter licenses for service providers, increasing expenses or leading to termination.
• Anonymity, sanctions, and illicit financing risks in digital asset transactions, potentially leading to legal liability or service disruptions.
• Trading on non-U.S. bitcoin exchanges being unregulated and less reliable.
• Regulatory changes or actions in foreign jurisdictions (e.g., China, UK, EU) affecting bitcoin value or use.
• Uncertain U.S. federal income tax treatment of the Trust and digital assets, including potential for UBTI for tax-exempt shareholders.
• Shareholders incurring tax liability without an associated distribution from the Trust.
• Hard forks resulting in taxable events for shareholders, even if assets are abandoned.
• Potential conflicts of interest between the Sponsor/affiliates and the Trust/Shareholders.
• Risk of Sponsor discontinuing services, leading to Trust termination.
• Bitcoin Custodian or Additional Bitcoin Custodian resigning or being removed, potentially triggering early dissolution.
• Lack of independent advisers representing investors in the Trust.
• Exchange halting trading in Shares, impacting ability to sell.
• Lack of active trading markets for Shares, resulting in losses upon disposition.
• Sponsor's limited history in operating such investment vehicles and reliance on key personnel.
• Trust being new and potentially unprofitable, leading to liquidation.
• Redemption/creation orders subject to postponement, suspension or rejection.
• Limited voting and distribution rights for Shareholders, and Sponsor's ability to amend Trust Agreement without consent.
• Non-exclusive jurisdiction and waiver of jury trial clauses limiting shareholder legal recourse.
• Operational and information security risks from cyber-attacks.
• ERISA risks if Trust assets are deemed plan assets.

Future Outlook

The Trust's investment objective is to reflect the performance of bitcoin's price less operating expenses, operating as a passive investment vehicle without active management to capitalize on or mitigate bitcoin price volatility. The Sponsor anticipates that the Sponsor Fee will revert to 0.20% of average daily net assets after July 31, 2026, for all assets. Future regulatory developments, particularly regarding the classification of digital assets and custody rules, could significantly impact the Trust's operations and the value of its shares. The administration's constructive approach to digital assets and potential legislation for government bitcoin acquisition could influence market sentiment, though there is no assurance these expectations will be fulfilled or that prices will rise.

Management Comments

• The Trust is not actively managed and will not take any actions to take advantage, or mitigate the impacts, of volatility in the price of bitcoin.
• The Sponsor believes that the design of the Trust enables certain investors to more effectively and efficiently implement strategic and tactical asset allocation strategies that use bitcoin by investing in the Shares rather than purchasing, holding and trading bitcoin directly or through derivatives.
• The Sponsor has evaluated the security procedures in place for safeguarding the Trusts bitcoins. Nevertheless, the security procedures cannot guarantee the prevention of any loss due to a security breach, hack, software defect or act of God that may be borne by the Trust and the security procedures may not protect against all errors, software flaws or other vulnerabilities in the Trusts technical infrastructure, which could result in theft, loss or damage of its assets.
• The Principal Executive Officer and Principal Financial and Accounting Officer of the Sponsor concluded that the Trust maintained effective internal control over financial reporting as of December 31, 2025.
• Since our commencement of operations, we have not experienced a material information security breach incident and we are not aware of any cybersecurity risks that are reasonably likely to materially affect our business.

Industry Context

StockSavvy.ai notes that the filing highlights the ongoing maturation and increasing institutionalization of the bitcoin market, evidenced by the VanEck Bitcoin ETF's significant asset growth despite price volatility. The SEC and FINRA's clarification on broker-dealers facilitating in-kind creations and redemptions for spot crypto ETPs is a positive step towards integrating digital assets into traditional financial infrastructure, potentially enhancing market efficiency and arbitrage mechanisms. However, the industry remains highly susceptible to regulatory uncertainty, as demonstrated by FinCEN's proposed rulemaking on CVC mixing and the ongoing debate over digital asset classification (security vs. commodity). The mention of President Trump's executive order for a Strategic Bitcoin Reserve and proposed legislation for government bitcoin acquisition underscores a growing, albeit uncertain, governmental interest in digital assets, which could significantly influence market dynamics. The continued reliance on a limited number of institutional-grade custodians like Gemini and Coinbase, who also serve competing products, points to potential interconnectedness and contagion risks within the nascent crypto ETP ecosystem, as well as concentration risk for custody services.

Comparison to Industry Standards

• The Sponsor Fee of 0.20% (waived for the first $2.5 billion until July 31, 2026) is competitive within the emerging spot Bitcoin ETF market. For example, BlackRock's iShares Bitcoin Trust (IBIT) has a 0.25% fee (waived to 0.12% for the first $5 billion for 12 months), and Fidelity Wise Origin Bitcoin Trust (FBTC) has a 0.25% fee (waived to 0% for the first $5 billion for 6 months). VanEck's waiver makes it highly competitive for smaller asset bases.
• The use of multiple custodians (Gemini and Coinbase Custody) for bitcoin holdings is a common practice among leading spot Bitcoin ETFs to mitigate single-custodian risk, aligning with industry best practices for digital asset security.
• The Trust's passive investment strategy, solely tracking bitcoin's price, is standard for spot Bitcoin ETFs, differentiating it from actively managed crypto funds or those investing in derivatives.
• The disclosure of cybersecurity measures, including adherence to the NIST framework and third-party assessments, reflects a commitment to security standards comparable to those expected in traditional financial services, which is crucial given the heightened cyber risks in the digital asset space.
• The significant unrealized depreciation on bitcoin investment in 2025 ($278,761,960) and the overall 6.34% decline in bitcoin price during the year reflect the inherent volatility of bitcoin, which is a characteristic shared across all direct bitcoin investment vehicles and spot ETFs.

Management Changes

Corporate Governance

Legal Proceedings

• On October 19, 2023, Gemini (Bitcoin Custodian) was named in a complaint filed by the New York Attorney General (NYAG Lawsuit) alleging violations of New York's Martin Act related to the Gemini Earn program.
• On February 9, 2024, NYAG amended its lawsuit with additional allegations against other defendants, but no new allegations were made against Gemini.
• On April 19, 2024, a settlement was approved in the Genesis bankruptcy proceedings allowing in-kind coin-for-coin payments.
• On May 29, 2024, Gemini made in-kind coin-for-coin payments to Gemini Earn investors, but approximately $50 million in cryptocurrency was still owed.
• On June 14, 2024, Gemini and NYAG entered into a Stipulation and Consent to Judgement (NYAG Settlement) resolving claims against Gemini, requiring Gemini to return approximately $50 million worth of digital assets to Gemini Earn investors and banning Gemini from operating crypto lending programs in New York without specific future legislation and NYAG consent.
• On February 28, 2024, Gemini and the New York State Department of Financial Services (NYDFS) entered into an administrative consent settlement agreement (NYDFS Settlement) finding Gemini conducted business unsafely, made misleading advertising, and failed customer due diligence. Gemini agreed to ensure at least $1.1 billion is returned to Gemini Earn users through Genesis bankruptcy, contribute at least $40 million for impacted users, and pay a $37 million fine to NYDFS.
• On March 22, 2023, Coinbase, Inc. (affiliate of Additional Bitcoin Custodian) and Coinbase Global received a Wells Notice from the SEC staff regarding potential enforcement action for federal securities law violations related to Coinbase Prime, spot market, staking service Coinbase Earn, and Coinbase Wallet.
• On June 6, 2023, the SEC filed a complaint against Relevant Coinbase Entities alleging failure to register as a national securities exchange, broker-dealer, and clearing agency, and failure to register its staking program.
• On February 27, 2025, the SEC and the Relevant Coinbase Entities filed a joint stipulation to dismiss the case with prejudice, and the case has been dismissed.

Related Party Transactions

• The Sponsor, VanEck Digital Assets, LLC, is a wholly-owned subsidiary of VanEck.
• MarketVector Indexes GmbH, the index sponsor and administrator for the MarketVectorTM Bitcoin Benchmark Rate, is an indirectly wholly-owned subsidiary of VanEck.
• Van Eck Securities Corporation, the Marketing Agent, is a wholly-owned subsidiary of VanEck.
• VanEck (parent of the Sponsor) was the initial seed investor, purchasing 8,000 Shares for $100,000 on December 21, 2023, and later purchasing 5,800,000 Shares for $72,500,000 on January 4, 2024.
• VanEck is a minority interest holder (less than 1% equity) in the parent company of Gemini Trust Company, LLC (Bitcoin Custodian).
• VanEck is a minority equity holder (approximately 6% equity) in Metatech Holdings, the parent company of Nonco LLC, which is a Liquidity Provider to the Trust.
• The Trust pays the Sponsor a unified fee (Sponsor Fee) of 0.20% of average daily net assets, which was waived for the first $2.5 billion of assets from November 25, 2025, through July 31, 2026.

Stakeholder Impact

• Shareholders: Experience direct exposure to bitcoin price movements, benefit from the Sponsor Fee waiver, but are subject to risks of bitcoin volatility, regulatory uncertainty, and limited legal recourse. They will not receive benefits from forks or airdrops.
• Authorized Participants: Facilitate creation and redemption of Baskets, subject to transaction fees and risks related to hedging bitcoin exposure and regulatory compliance. SEC/FINRA clarification on in-kind creations/redemptions is beneficial.
• Sponsor (VanEck Digital Assets, LLC): Manages the Trust, receives the Sponsor Fee (subject to waiver), and is responsible for operational oversight and marketing. Faces potential conflicts of interest due to affiliations with other service providers.
• Bitcoin Custodians (Gemini Trust Company, LLC and Coinbase Custody Trust Company, LLC): Responsible for safeguarding the Trust's bitcoin. Subject to regulatory scrutiny and legal proceedings (Gemini, Coinbase), which could impact their ability to provide services.
• Liquidity Providers (e.g., JSCT, LLC, Nonco LLC, Cumberland New York LLC): Facilitate bitcoin purchases and sales for cash creations/redemptions. Their ability to hedge and participate is crucial for the Trust's arbitrage mechanism.
• Regulators (SEC, CFTC, FinCEN, NYDFS): Actively scrutinizing and developing regulations for the digital asset industry, which could impose new requirements or restrictions on the Trust and its service providers.

Next Steps

• The Sponsor Fee waiver for the first $2.5 billion of assets will continue until July 31, 2026, after which the fee will revert to 0.20%.
• The U.S. Treasury Department and U.S. Department of Commerce are directed to develop budget-neutral strategies for acquiring additional bitcoin for the Strategic Bitcoin Reserve.
• Legislation has been introduced in the U.S. Senate and House of Representatives to direct the acquisition of one million bitcoin by the federal government over a five-year period.
• The SEC and CFTC may be granted additional authorities to regulate digital asset markets, potentially impacting the Trust and its service providers.
• FinCEN's proposed rulemaking on CVC mixing could impose new requirements on financial institutions, potentially affecting bitcoin transactions.
• The Trust will continue to monitor and adapt to evolving regulatory landscapes concerning digital assets.

Key Dates

Recommendation

The VanEck Bitcoin ETF provides direct exposure to bitcoin, which experienced significant price volatility and a decline in 2025. While the Trust's assets under management grew due to new share issuances, the underlying asset's performance led to unrealized depreciation. The Sponsor's fee waiver is a positive, but the inherent risks of bitcoin's volatility, regulatory uncertainty, and potential operational disruptions remain substantial. A "hold" recommendation is appropriate for investors already exposed to bitcoin via this ETF, acknowledging both the long-term potential of bitcoin and the significant short-to-medium term risks and uncertainties outlined in the filing. New investors should carefully consider the high-risk nature of bitcoin and the ETF's passive management before initiating a position.

Keywords

Bitcoin ETF, HODL, VanEck, Digital Assets, Cryptocurrency, SEC Filing, 10-K, Financial Report, Bitcoin Price, MarketVector Bitcoin Benchmark Rate, Custody, Gemini, Coinbase, Regulation, Risk Factors, Investment, Blockchain, Spot Bitcoin ETF