NYSE: CLNK

As of the date of this Annual Report, the Trust does not engage in staking. However, at a future date, it is the current intention of the Trust to conduct staking as a secondary investment objective. In connection with its future secondary investment objective of seeking to derive additional Chainlink through staking, the Trust will stake some or all of the Chainlink held in the Trust Chainlink Accounts. The Sponsor will select one or more trusted staking agents (the “Staking Agents”). Such Staking Agents operate the node operator infrastructure associated with the Trust’s staked Chainlink.

Chainlink is a digital asset. Like all digital assets, buying, holding and selling Chainlink is very different from buying, holding and selling more conventional investments like stocks and bonds. Stocks represent ownership in a company, entitling shareholders to a portion of the company’s profits. Bonds are debt instruments issued by corporations or governments, where the bondholder is a creditor to the issuer that is generally entitled to a stream of income payments. Ownership of stocks and bonds is typically recorded through a centralized system managed by brokers, custodians or clearinghouses. Ownership of Chainlink does not entitle its holders to any portion of a company’s profits or any stream of income payments. Chainlink is a decentralized digital asset and ownership of it is reflected on a decentralized ledger.

The Trust provides investors with the opportunity to access the market for Chainlink through a traditional brokerage account without the potential barriers to entry or risks involved with acquiring and holding Chainlink directly. The Trust will not use derivatives that could subject the Trust to additional counterparty and credit risks. The Sponsor believes that the design of the Trust will enable certain investors to more effectively and efficiently implement strategic and tactical asset allocation strategies that use Chainlink by investing in the Shares rather than purchasing, holding and trading Chainlink directly.

1

Investment Objectives and Strategies

The Trust’s primary investment objective is to seek to provide exposure to the value of Chainlink held by the Trust, less the expenses of the Trust’s operations. In seeking to achieve its primary investment objective, the Trust will hold Chainlink and accrue the Sponsor’s management fee (the “Sponsor Fee”) in U.S. dollars.

The Trust will value its Chainlink holdings, net assets and the Shares daily based on the Pricing Benchmark. The Trust is passively managed and does not pursue active management investment strategies, and the Sponsor does not actively manage the Chainlink held by the Trust. This means that the Sponsor does not sell Chainlink at times when its price is high or acquire Chainlink at low prices in the expectation of future price increases. It also means that the Sponsor does not make use of any of the hedging techniques available to professional Chainlink investors to attempt to reduce the risks of losses resulting from price decreases. The Trust will not utilize leverage or any similar arrangements in seeking to meet its investment objectives. Chainlink will be the only digital asset held by the Trust.

Although the Shares are not the exact equivalent of a direct investment in Chainlink, they provide investors with an alternative that constitutes a relatively cost-effective way to obtain Chainlink exposure through the securities market.

The Trust may either create and redeem Shares in-kind for Chainlink (“In-Kind Creations” and “In-Kind Redemptions,” respectively) or for cash (“Cash Creations” and “Cash Redemptions,” respectively). When the Trust creates or redeems its Shares, it will do so in blocks of 10,000 Shares (each, a “Basket”) based on the quantity of Chainlink attributable to each Share of the Trust (net of accrued but unpaid expenses and liabilities) multiplied by the number of Shares (10,000) comprising a Basket (the “Basket Amount”). For an order to purchase (create) a Basket, the purchase shall be in the amount of Chainlink represented by the Basket Amount (in the case of an In-Kind Creation) or the amount of U.S. dollars needed to purchase the Basket Amount (plus a per-order transaction fee), as calculated by the Administrator (as defined below) (in the case of a Cash Creation). For an order to redeem a Basket, the Sponsor shall either arrange for the Basket Amount of Chainlink to be distributed in-kind (in the case of an In-Kind Redemption) or sold and the cash proceeds (minus a per-order transaction fee) distributed (in the case of a Cash Redemption). The Trust only creates and redeems Baskets in transactions with financial firms that are authorized to create or redeem Shares with the Trust (each, an “Authorized Participant”). In the case of In-Kind Creations and In-Kind Redemptions, an Authorized Participant or an Authorized Participant’s designee (“Authorized Participant Designee”) deposits Chainlink directly with the Trust or receives Chainlink directly from the Trust. Shares initially comprising the same Basket but offered by the Authorized Participants to the public at different times may have different offering prices that depend on various factors, including the supply and demand for Shares, the value of the Trust’s assets, and market conditions at the time of a transaction.

The Basket Amount required to create each Basket changes from day to day. On each day that the Exchange is open for regular trading, the Administrator adjusts the quantity of Chainlink constituting the Basket Amount as appropriate to reflect accrued expenses and any loss of Chainlink that may occur. The computation is made by the Administrator each business day prior to the commencement of trading on the Exchange. The Administrator determines the Basket Amount for a given day by dividing the number of Chainlink held by the Trust as of the opening of business on that business day, adjusted for the amount of Chainlink constituting estimated accrued but unpaid fees and expenses of the Trust as of the opening of business on that business day, by the quotient of the number of Shares outstanding at the opening of business divided by 10,000. Fractions of Chainlink smaller than 0.00000001 are disregarded for purposes of the computation of the Basket Amount. The Basket Amount so determined is communicated via electronic mail message to all Authorized Participants and made available on the Sponsor’s website for the Shares.

Purchases and Sales of Chainlink

When the Trust conducts Cash Creations or Cash Redemptions, it will be responsible for purchasing and selling Chainlink. The Trust may also be required to sell Chainlink to pay certain extraordinary, non-recurring expenses that are not assumed by the Sponsor. Under such circumstances, the Sponsor, on behalf of the Trust, will typically seek to buy and sell Chainlink at a price as close to the Pricing Benchmark as practical. The Chainlink Trading Counterparties will pay their own fees associated with their purchase and sale of Chainlink. Such purchase and sale transactions may be conducted pursuant to two models: (i) the “Trust-Directed Trade Model”; and (ii) the “Agent Execution Model.” The Trust intends to utilize the Trust-Directed Trade Model for all purchases and sales of Chainlink and will only utilize the Agent Execution Model in the event that no Chainlink Trading Counterparty (as defined below) is willing or able to effectuate the Trust’s purchase or sale of Chainlink.

Under the Trust-Directed Trade Model, the Sponsor, on behalf of the Trust, is responsible for acquiring Chainlink from a Chainlink trading counterparty that has been approved by the Sponsor (each, a “Chainlink Trading Counterparty”). As of

2

January 5, 2026, Nonco LLC and Virtu Americas LLC have been approved as Chainlink Trading Counterparties. The Authorized Participants are not affiliated with the Chainlink Trading Counterparties. The Sponsor has entered into contractual agreements with the Chainlink Trading Counterparties, and these agreements set forth the general parameters under which a transaction in Chainlink will be effectuated, should any transaction with a Chainlink Trading Counterparty occur. These agreements do not require the Sponsor to utilize any particular Chainlink Trading Counterparty, and do not create any contractual obligations on the part of any Chainlink Trading Counterparty to participate in cash or in-kind orders for creations or redemptions. All transactions between the Sponsor, on behalf of the Trust, and a Chainlink Trading Counterparty will be done on an arm’s-length basis. The Sponsor will not assume the fees of Chainlink Trading Counterparties in connection with their purchase and sale of Chainlink.

Under the Agent Execution Model, Coinbase, Inc. (“Coinbase Inc.” or the “Prime Execution Agent,” which is an affiliate of the Chainlink Custodian), acting in an agency capacity, conducts Chainlink purchases and sales on behalf of the Trust with third parties through its Coinbase Prime service pursuant to an agreement (the “Prime Execution Agreement”). To utilize the Agent Execution Model, the Trust may maintain some Chainlink or cash in a trading account (the “Trading Balance”) with the Prime Execution Agent. To avoid having to pre-fund purchases or sales of Chainlink in connection with cash creations and redemptions and sales of Chainlink to pay Trust expenses not assumed by the Sponsor, to the extent applicable, the Trust may borrow Chainlink or cash as trade credit (“Trade Credit”) from Coinbase Credit, Inc. (the “Trade Credit Lender”) on a short-term basis pursuant to the Coinbase Credit Committed Trade Financing Agreement (the “Trade Financing Agreement”).

The Trust’s Legal Structure

The Trust is a Delaware statutory trust, formed pursuant to the Delaware Statutory Trust Act (the “DSTA”). The Trust continuously issues common shares representing units of undivided beneficial ownership of the Trust that may be purchased and sold on the Exchange. The Trust operates pursuant to the First Amended and Restated Declaration of Trust and Trust Agreement (the “Trust Agreement”), dated as of November 17, 2025. CSC Delaware Trust Company, a Delaware trust company, is the Delaware trustee of the Trust (the “Trustee”). The Trust is managed and controlled by the Sponsor pursuant to the terms of the Trust Agreement and the Sponsor Agreement, dated as of January 5, 2026, between the Trust and the Sponsor. The Sponsor is a limited liability company formed in the State of Delaware on June 4, 2018. Except as required under applicable federal law or under the rules or regulations of the Exchange, Shareholders do not have any voting rights and take no part in the management or control of, and have no voice in, the Trust’s operations or business. The Trust Agreement and the Sponsor Agreement set forth the terms pursuant to which the Trust is operated, including the amount of the Sponsor Fee and any other fees and expenses charged to the Trust. These agreements may be amended without Shareholder approval. Although not currently intended, such amendments could potentially increase the amount of fees and expenses paid by the Trust. In the event of a material amendment to the Trust Agreement or Sponsor Agreement, including an increase in the Sponsor Fee, Shareholders will be provided notice of such amendment on the Trust’s website, through a current report on Form 8-K and/or in the Trust’s annual or quarterly reports.

The Trust’s Service Providers

The Sponsor

Bitwise Investment Advisers, LLC serves as the Sponsor for the Trust. The Sponsor arranged for the creation of the Trust and is responsible for the ongoing registration of the Shares for their public offering in the United States and the listing of the Shares on the Exchange. The Sponsor will develop a marketing plan for the Trust, will prepare marketing materials regarding the Shares and will operate the marketing plan of the Trust on an ongoing basis. The Sponsor also oversees the additional service providers of the Trust and exercises managerial control of the Trust as permitted under the Trust Agreement.

3

The Trustee

CSC Delaware Trust Company serves as the Trustee, as required to create a Delaware statutory trust in accordance with the Trust Agreement and the DSTA.

The Administrator

The Bank of New York Mellon (“BNY Mellon”) serves as the Trust’s administrator (in such capacity, the “Administrator”). Under the Trust Administration and Accounting Agreement, the Administrator provides necessary administrative, tax and accounting services and financial reporting for the maintenance and operations of the Trust. In addition, the Administrator makes available the office space, equipment, personnel and facilities required to provide such services. The Administrator’s principal address is 240 Greenwich Street, New York, New York 10286.

The Transfer Agent

BNY Mellon serves as the transfer agent for the Trust (in such capacity, the “Transfer Agent”). The Transfer Agent: (1) issues and redeems Shares of the Trust; (2) responds to correspondence by Shareholders and others relating to its duties; (3) maintains Shareholder accounts; and (4) makes periodic reports to the Trust.

The Chainlink Custodian

Coinbase Custody Trust Company, LLC serves as the Trust’s Chainlink Custodian pursuant to an agreement between it and the Trust (the “Chainlink Custody Agreement”). The Chainlink Custodian is a fiduciary under § 100 of the New York Banking Law. Under the Chainlink Custody Agreement, the Chainlink Custodian is responsible for safekeeping the Chainlink owned by the Trust. The Chainlink Custodian was selected by the Sponsor. The Chainlink Custodian has responsibility for opening a special account that holds the Trust’s Chainlink (the “Trust Chainlink Account”) and implementing the controls designed by the Sponsor for the account, as well as facilitating the transfer of Chainlink required for the operation of the Trust. The Chainlink Custodian will also enter into an agreement with the Sponsor to open a custody account to receive payment of the Sponsor Fee (the “Sponsor Chainlink Account”).

The Chainlink Custodian is a third-party limited-purpose trust company that was chartered in 2018 upon receiving a trust charter from the New York Department of Financial Services. The Chainlink Custodian has one of the longest track records in the industry of providing custodial services for digital asset private keys. The Sponsor believes that the Chainlink Custodian’s policies, procedures, and controls for safekeeping, exclusively possessing, and controlling the Trust’s Chainlink holdings are consistent with industry best practices to protect against theft, loss, and unauthorized and accidental use of the private keys. The Trust Chainlink Account and Sponsor Chainlink Account are segregated accounts and are therefore not commingled with corporate or other customer assets.

The Trust may retain additional Chainlink custodians from time to time pursuant to a Chainlink custodian agreement to perform certain services that are typical of a Chainlink custodian. The Sponsor may, in its sole discretion, add or terminate Chainlink custodians at any time.

The Cash Custodian

BNY Mellon also serves as the Cash Custodian pursuant to an agreement between it and the Trust (the “Cash Custody Agreement”). The Cash Custodian is the custodian of the Trust’s cash holdings. The Trust may retain additional cash custodians from time to time pursuant to a cash custodian agreement to perform certain services that are typical of a cash custodian. The Sponsor may, in its sole discretion, add or terminate cash custodians at any time.

The Marketing Agent

Foreside Fund Services, LLC (the “Marketing Agent”) is responsible for: (1) working with the Transfer Agent to review and approve, or reject, creation and redemption orders of Shares placed by Authorized Participants with the Transfer Agent; and (2) reviewing and approving the marketing materials prepared by the Trust for compliance with applicable U.S. Securities and Exchange Commission (“SEC”) and Financial Industry Regulatory Authority (“FINRA”) advertising laws, rules, and regulations.

4

Except for the specific, limited circumstance and time in which the Trust is using the Agent Execution Model, the Trust, the Sponsor and the service providers will not loan or pledge the Trust’s assets, nor will the Trust’s assets serve as collateral for any loan or similar arrangement. During the specific, limited circumstance and time when the Trust is using the Agent Execution Model, the Trust’s Chainlink may be subject to a lien to secure outstanding Trade Credits in favor of the Trade Credit Lender, as is discussed in further detail below.

The Trust’s Fees and Expenses

The Trust will pay the unitary Sponsor Fee of 0.34% per annum of the Trust’s Chainlink holdings. For a 3-month period commencing on the day the Shares are initially listed on the Exchange, the Sponsor has agreed to waive the entire Sponsor Fee on the first $500 million of Trust assets.

The Sponsor Fee is paid by the Trust to the Sponsor as compensation for services performed under the Trust Agreement and Sponsor Agreement. Except during periods in which all or a portion of the Sponsor Fee is being waived, the Sponsor Fee will accrue daily and will be payable in Chainlink monthly in arrears. The Administrator will calculate the Sponsor Fee on a daily basis by applying a 0.34% annualized rate to the Trust’s total Chainlink holdings, and the amount of Chainlink payable in respect of each daily accrual shall be determined by reference to the Pricing Benchmark.

The NAV of the Trust is reduced each day by the amount of the Sponsor Fee calculated each day. On or about the last day of each month, an amount of Chainlink will be transferred from the Trust Chainlink Account to the Sponsor Chainlink Account equal to the sum of all daily Sponsor Fees accrued for the month in U.S. dollars divided by the Pricing Benchmark on the last day of the month. The Trust is not responsible for paying any fees or costs associated with the transfer of Chainlink to the Sponsor. The Sponsor, from time to time, may temporarily waive all or a portion of the Sponsor Fee in its sole discretion. The Sponsor may notify Shareholders of its intent to commence, or cease, waiving the Sponsor Fee on the Trust’s website, through a current report on Form 8-K and/or in the Trust’s annual or quarterly reports.

In exchange for the Sponsor Fee, the Sponsor has agreed to assume and pay the normal operating expenses of the Trust, which include the Trustee’s monthly fee and out-of-pocket expenses, the fees of the Trust’s regular service providers (Cash Custodian, Chainlink Custodian, Prime Execution Agent, Marketing Agent, Transfer Agent and Administrator), exchange listing fees, tax reporting fees, SEC registration fees, printing and mailing costs, audit fees and up to $500,000 per annum in ordinary legal fees and expenses. The Sponsor may determine in its sole discretion based upon prevailing circumstances to assume legal fees and expenses of the Trust in excess of $500,000 per annum. The Sponsor will also pay the costs of the Trust’s organization.

If and when the Trust begins staking, the additional Chainlink generated by the Trust’s staking program will be subject to fees shared among the Staking Agent(s) and the Sponsor. The amounts owed or paid to the Staking Agent(s) and the Sponsor are collectively referred to as the “Staking Expenses”. The Staking Expenses will reduce the amount of Chainlink generated from the staking of the Trust’s Chainlink that is ultimately retained by the Trust. The Trust’s NAV will reflect the amount of Chainlink the Trust is entitled to under its staking program after deduction of all Staking Expenses.

The Trust may incur certain extraordinary, non-recurring expenses that are not assumed by the Sponsor, including, but not limited to, taxes and governmental charges, any applicable brokerage commissions, financing fees, expenses and costs of any extraordinary services performed by the Sponsor (or any other service provider) on behalf of the Trust to protect the Trust or the Shareholders (including, for example, in connection with any fork of the Ethereum Blockchain (upon which Chainlink is issued) or the Chainlink Network, any Incidental Rights (as defined below) and any IR Asset (as defined below)), any indemnification of the Cash Custodian, Chainlink Custodian, Prime Execution Agent, Transfer Agent, Administrator or other agents, service providers or counterparties of the Trust, and extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation, regulatory enforcement or investigation matters. The Administrator and/or the Sponsor will direct the Chainlink Custodian to transfer Chainlink from the Trust Chainlink Account to the Sponsor Chainlink Account to pay the Sponsor Fee and any other Trust expenses not assumed by the Sponsor. To pay for expenses not assumed by the Sponsor that are denominated in U.S. dollars, the Sponsor, on behalf of the Trust, may sell the Trust’s Chainlink as necessary to pay such expenses.

5

Transfers of Chainlink to and from the Trust Chainlink Account to the Chainlink Trading Counterparty are “on-chain” transactions represented on a blockchain. Transfer fees with respect to this on-chain transfer of Chainlink will be paid by the Chainlink Custodian. The Chainlink Custodian will not pay such transfer fees with the Trust’s assets.

Custody of the Trust’s Assets

The Trust’s Chainlink Custodian will maintain custody of all of the Trust’s Chainlink, other than the Trading Balance with Coinbase, Inc. (“Coinbase Inc.” or the “Prime Execution Agent,” which is an affiliate of the Chainlink Custodian), in the Trust Chainlink Account. The Trading Balance will only be used in the limited circumstances in which the Trust is using the Agent Execution Model to effectuate the purchases and sales of Chainlink. The Chainlink Custodian provides safekeeping of digital assets using a multi-layer cold storage security platform designed to provide offline security of the digital assets held by the Chainlink Custodian. However, the Chainlink Custodian is not a banking institution or otherwise a member of the FDIC and, therefore, deposits held with or assets held by the Chainlink Custodian are not insured by the FDIC. In addition, neither the Trust nor the Sponsor insures the Trust’s Chainlink. The Chainlink Custodian has insurance coverage as a subsidiary under its parent company, Coinbase Global, Inc., which procures fidelity (e.g., crime) insurance to protect the organization from risks such as theft of funds. Specifically, the fidelity program provides coverage for the theft of funds held in hot or cold storage. The insurance program is provided by a syndicate of industry-leading insurers. The insurance program does not cover, insure or guarantee the performance of the Trust.

The Chainlink in the Trust Chainlink Account may be held across multiple wallets, any of which will feature the following safety and security measures to be implemented by the Chainlink Custodian:

•
Cold Storage: Cold storage in the context of Chainlink means keeping the reserve of Chainlink offline, which is a widely used security precaution, especially when dealing with a large amount of Chainlink. Chainlink held under custodianship with the Chainlink Custodian will be kept in high-security, offline, multi-layer cold storage vaults. This means that the private keys, the cryptographic component that allows a user to access Chainlink, are stored offline on hardware that has never been connected to the internet. Storing the private key offline minimizes the risk of the Chainlink being stolen. The Sponsor expects that all of the Trust’s Chainlink will be held in cold storage of the Chainlink Custodian on an ongoing basis. In connection with creations or redemptions, the Trust will, under most circumstances, process redemptions by selling Chainlink from the portion of its Chainlink held in cold storage.

•
Private Keys: All private keys are securely stored using multiple layers of high-quality encryption and in Chainlink Custodian-owned offline hardware vaults in secure environments. No customers or third parties are given access to the Chainlink Custodian’s private keys.

•
Whitelisting: Transactions are only sent to vetted, known addresses. The Chainlink Custodian’s platform supports pre-approval and test transactions. The Chainlink Custodian requires authentication when adding or removing addresses for whitelisting. All instructions to initiate a whitelist addition or removal must be submitted via the Coinbase Custody platform. When a whitelist addition or removal request is initiated, the initiating user will be prompted to authenticate its request using a two-factor authentication key. A consensus mechanism on the Coinbase Custody platform dictates how many approvals are required in order for the consensus to be achieved to add or remove a whitelisted address. Only when the consensus is met is the underlying transaction considered officially approved. An account’s roster and user roles are maintained by the Chainlink Custodian in a separate log, an Authorized User List (“AUL”). Any changes to the account’s roster must be reflected on an updated AUL first and executed by an authorized signatory.

•
Audit Trails: Audit trails exist for all movement of Chainlink within Chainlink Custodian-controlled Chainlink wallets and are audited annually for accuracy and completeness by an independent external audit firm.

In addition to the above measures, in accordance with the Chainlink Custody Agreement, Chainlink held in custody with the Chainlink Custodian will be segregated from both the proprietary property of the Chainlink Custodian and the assets of any other customer in accounts that clearly identify the Trust as the owner of the accounts.

6

Under the rare and limited circumstances when the Trust is utilizing the Agent Execution Model to acquire Chainlink pursuant to a Cash Creation, a portion of the Trust’s Chainlink holdings and cash holdings may be held with the Prime Execution Agent in the Trading Balance. The Trust will only utilize the Agent Execution Model when the Trust-Directed Trading Model is unavailable. Within the Trust’s Trading Balance, the Prime Execution Agreement provides that the Trust does not have an identifiable claim to any particular Chainlink (and cash). Instead, the Trust’s Trading Balance represents an entitlement to a pro rata share of the Chainlink (and cash) the Prime Execution Agent holds on behalf of customers who hold similar entitlements against the Prime Execution Agent. In this way, the Trust’s Trading Balance represents an omnibus claim on the Prime Execution Agent’s Chainlink (and cash) held on behalf of the Prime Execution Agent’s customers. The Prime Execution Agent holds the Chainlink associated with customer entitlements across a combination of omnibus cold wallets, omnibus “hot” wallets (meaning wallets whose private keys are generated and stored online, in internet-connected computers or devices) or in omnibus accounts in the Prime Execution Agent’s name on a trading venue (including third-party venues and the Prime Execution Agent’s own execution venue) where the Prime Execution Agent executes orders to buy and sell Chainlink on behalf of its clients. Within such omnibus hot and cold wallets and accounts, the Prime Execution Agent has represented to the Sponsor that it keeps the majority of assets in cold wallets, to promote security, while the balance of assets is kept in hot wallets to facilitate rapid withdrawals. However, the Sponsor has no control over, and for security reasons the Prime Execution Agent does not disclose to the Sponsor, the percentage of Chainlink that the Prime Execution Agent holds for customers holding similar entitlements as the Trust, which are kept in omnibus cold wallets, as compared to omnibus hot wallets or omnibus accounts in the Prime Execution Agent’s name on a trading venue. The Prime Execution Agent has represented to the Sponsor that the percentage of assets maintained in cold versus hot storage is determined by ongoing risk analysis and market dynamics, in which the Prime Execution Agent attempts to balance anticipated liquidity needs for its customers as a class against the anticipated greater security of cold storage.

To the extent that the Trust engages an additional Chainlink Custodian in the future (a “Future Chainlink Custodian,” and with Coinbase Custody, the “Chainlink Custodians”), other than the Chainlink held with the Prime Execution Agent in the Trust’s Trading Balance, the Sponsor will allocate the Trust’s Chainlink between the Trust Chainlink Account at Coinbase Custody and the special account that holds the Trust’s Chainlink at the Future Chainlink Custodian (the “Future Trust Chainlink Account,” and with the Trust Chainlink Account, the “Trust Chainlink Accounts”). In selecting a Future Chainlink Custodian, the Sponsor, on behalf of the Trust, will consider a number of factors, including, but not limited to, regulatory compliance, operational security, insurance coverage, institutional reputation, and demonstrated experience safely storing large digital asset holdings. In determining the amount and percentage of the Trust’s Chainlink to allocate to each Trust Chainlink Account, the Sponsor will consider (i) the concentration of the Trust’s Chainlink at each Chainlink Custodian, (ii) the Sponsor’s assessment of the safety and security policies and procedures of each Chainlink Custodian, (iii) the insurance policies of each Chainlink Custodian, (iv) the fees and expenses associated with the storage of the Trust’s Chainlink at each Chainlink Custodian, (v) the fees and expenses associated with the transfer to or from the Trust Chainlink Account at each Chainlink Custodian, and (vi) any other factor the Sponsor deems relevant in making the allocation determination. The Sponsor does not intend to disclose the amount or percentage of the Trust’s Chainlink held at either Coinbase Custody or the Future Chainlink Custodian, and the Sponsor may change the allocation between the Chainlink Custodians at any time and without notice to Shareholders. The fees and expenses associated with the transfer of Chainlink between the Trust Chainlink Account at each Chainlink Custodian will be borne by the Sponsor, not the Trust or the Shareholders. Any transfer of Chainlink between the Trust Chainlink Accounts at each Chainlink Custodian will occur “on-chain” over the Ethereum Blockchain. On-chain transactions are subject to all of the risks of the Ethereum Blockchain, including the risk that transactions will be made erroneously and are generally irreversible.

The Trust relies on the Cash Custodian to hold any cash related to the Cash Creation and Cash Redemption of Shares, purchase or sale of Chainlink or held for payment of expenses not assumed by the Sponsor.

The Transfer Agent will facilitate the settlement of Shares in response to the placement of creation and redemption orders from Authorized Participants.

Chainlink, the Chainlink Network, and the Ethereum Blockchain

Chainlink is a digital asset that exists as a token on the Ethereum Blockchain, issued via smart contract and transferable using the Ethereum Blockchain’s peer-to-peer network protocols. Chainlink transactions are settled on the Ethereum Blockchain, while the Chainlink Network delivers data across the Ethereum Blockchain and other blockchains. No single entity owns or operates the Ethereum Blockchain, the infrastructure of which is collectively maintained by a decentralized user base.

Chainlink was created by Sergey Nazarov and Steve Ellis in 2017. Their aim was to develop a mechanism through which smart contracts could pull real-time data from the off-chain world. The network they created relies on a series of decentralized

7

oracle nodes that furnish data to blockchains, most notably the Ethereum Blockchain. Since its inception, Chainlink has gained significant attention and investment, positioning itself as a prominent player in the blockchain industry.

The Chainlink Network allows people to exchange tokens of value, Chainlink, for access to the data provided by the network’s oracle services. Chainlink can be used to pay for goods and services, including to receive data from the Chainlink Network, or it can be converted to fiat currencies, such as the U.S. dollar.

Chainlink is issued through a smart contract on the Ethereum Blockchain. It follows the ERC-677 token standard, a variation of the widely used ERC-20 token standard with additional functionalities. The design of Chainlink tokens allows senders of Chainlink to pay an oracle node and request data from that oracle node in the same transaction. This adds efficiencies to transactions by cutting down on costs.

Chainlink attempts to derive much of its value from utility. Users who want to utilize the Chainlink Network must pay fees in Chainlink.

The Chainlink token is issued on a shared public ledger, the Ethereum Blockchain, similar to the Bitcoin network. However, the Chainlink Network differentiates itself from many other digital asset networks in that its stated primary function is as a data provider for decentralized applications, rather than serving as a store of value or means of payment, or as a platform for building smart contracts.

Chainlink aims to deliver reliable data feeds to smart contracts on Ethereum, layer-2 networks reliant on the Ethereum Blockchain, as well as Solana, Avalanche, and other widely used blockchain networks. It sources data from multiple independent node operators to create an aggregated report that it submits on-chain.

Chainlink launched as an initial coin offering in 2017. Thirty-five percent of its total token supply was sold to the public through an on-chain sale. An additional 35% was earmarked for community initiatives, and 30% was reserved for the Chainlink team.

Summary of a Chainlink Transaction

The following is a summary of a transaction of Chainlink on the Ethereum Blockchain.

A transaction is initiated by a user who holds an Ethereum Blockchain wallet. The user uses their wallet (whether it’s a software wallet, hardware wallet, or a digital asset trading platform) to create the transaction. This transaction includes details such as the destination address, the amount of Chainlink to be transferred, and any additional data such as the desired operation to be performed on the Ethereum Blockchain and the fee the transacting party is willing to pay to have the transaction process.

To authenticate the transaction, the user’s wallet signs the transaction using the private key associated with their Chainlink address. The private key is essential, as it proves ownership of the address and authorizes the movement of funds. The signing process generates a unique cryptographic signature based on the transaction details and the private key. This ensures that the transaction cannot be modified after signing.

Once signed, the transaction is broadcasted to the Ethereum Blockchain. This involves sending the transaction to a decentralized network of nodes. The transaction is propagated across the network, where it is received by validators. Validators are independent nodes that maintain a copy of the Ethereum Blockchain and participate in the proof-of-stake consensus process.

The Ethereum Blockchain uses proof-of-stake consensus mechanism, where validators stake ether and participate in processing transactions. Validators ensure that each transaction is valid by checking factors such as whether the sender has sufficient funds and if the transaction is correctly signed, among other items. Holders of ether must stake the required minimum amount to become an Ethereum Blockchain validator. The minimum stake amount to activate a single validator is 32 ether. The maximum amount that can be staked to a single validator and earn rewards is 2,048 ether.

The Ethereum Blockchain processes transactions sequentially. Blocks are produced approximately every 12 seconds on the Ethereum Blockchain and grouped into “epoch” that last approximately 6 minutes. Certain validators will lead the transaction processing effort during each epoch. Rewards for participating in the consensus process are distributed at the end of each epoch, and new validator leaders are chosen to lead the next epoch.

8

When a transaction is included in a block and that block is added to the blockchain, the transaction is considered confirmed. Once confirmed, the transaction is difficult to reverse, and the sender’s balance is deducted and smart contract capabilities may be triggered. Once the transaction is confirmed, it becomes part of the immutable blockchain, providing a permanent and transparent record of the transfer and activity.

Chainlink Markets and Exchanges

Chainlink can be transferred in direct peer-to-peer transactions by sending Chainlink over the Ethereum Blockchain from one Chainlink address to another. Users can use Chainlink to pay other Chainlink users for goods and services, resembling a barter system. Consumers can also pay merchants and businesses for products or services through direct peer-to-peer transactions on the Ethereum Blockchain or via third-party service providers. Chainlink can also be used to pay for data fees on the Chainlink Network.

In addition to using Chainlink for transactions, investors may purchase and sell Chainlink to speculate on its market value or as a long-term investment to diversify their portfolios. The value of Chainlink within the market is influenced by factors such as supply and demand in the global Chainlink market, expectations for Chainlink’ adoption as a data provider for decentralization applications, the development of applications utilizing the Chainlink Network, and other purposes.

Chainlink spot markets generally allow investors to open accounts with digital asset trading platforms and then buy or sell Chainlink via websites or mobile applications. Prices for Chainlink trades on these markets are typically publicly reported. Investors wishing to trade Chainlink on a digital asset platform must deposit an accepted government-issued currency or previously acquired digital assets into their platform account before they can purchase or sell Chainlink. This process of setting up an account with a trading platform and executing trades is separate from, and should not be confused with, the process of transferring Chainlink between addresses on the Ethereum Blockchain. The latter involves activities directly on the Ethereum Blockchain, while trading on digital platforms occurs within the exchange’s order book. The platform generally records an investor’s Chainlink ownership in its internal books, not on the Ethereum Blockchain. Chainlink is typically not transferred to the investor’s personal wallet unless they request a withdrawal to an off-platform Ethereum Blockchain address.

Outside of spot markets, Chainlink can also be traded over-the-counter (OTC). The OTC market is predominantly institutional, with participants including firms that provide two-sided liquidity for Chainlink, investment managers, proprietary trading firms, high-net-worth individuals, entities holding significant amounts of Chainlink, and family offices. The OTC market offers a flexible environment in terms of quotes, pricing, and quantity, though it often involves large quantities of Chainlink. There is no formal structure to the OTC market, nor an open meeting place for transactions. Parties involved in OTC trades typically agree on the price—often by phone or email—before one party initiates the transfer by sending Chainlink to the buyer’s Chainlink address. The buyer would then transfer the agreed-upon currency to the seller’s bank account. OTC trades are sometimes hedged and eventually settled on digital asset trading platforms.

Chainlink Supply

The total supply of Chainlink is capped at 1 billion tokens, many of which were subject to time locks following the initial creation. As of November 14, 2025, approximately 696,840,970 Chainlink tokens were believed to be in the circulating supply. Chainlink Labs unlocks batches of tokens roughly once every quarter. The token release schedule is currently 7% of the total supply per year.

Modifications to the Chainlink Network

The Chainlink Network is comprised of oracles that deliver real-time on-chain smart contracts, which then aggregate that data for blockchain applications. Signers to a multisignature safe oversee updates to these smart contracts. The signers include operators of established Chainlink oracles as well as members of the Chainlink Labs team. The changes might include updates to account for token migrations, extreme market conditions, or security procedures, among other items.

Forms of Attack Against the Chainlink Network

All networked systems are vulnerable to various types of attacks, and the Chainlink Network is no exception. Like any decentralized computer network, the Chainlink Network contains certain vulnerabilities. The Chainlink Network relies on a decentralized network of oracle nodes who source data and reach consensus on external events.

9

In September 2020, an attacker tricked oracle operators into spending excessive amounts of gas tokens on data requests that were later determined to be spam. The attack caused several node operators to collectively lose over $300,000 but did not result in any loss of services to the Chainlink Network.

Market Participants

Node Operators

The Chainlink Network is comprised of oracles that deliver real-time data to on-chain customers. Independent node operators manage these oracles. They pull real-time data from API feeds and other off-chain data sources, set their own fee structures and stake Chainlink to attest to the validity of their work. Users of the Chainlink Network pay the operators in Chainlink to access their data.

Data Customers

Decentralized applications may utilize the Chainlink Network as a source of data for their smart contracts. These may include on-chain borrowing and trading venues, or applications that otherwise need verifiable data feeds. Data customers pay node operators for their services in Chainlink.

Banks and Financial Institutions

Banks and financial institutions may explore the potential of Chainlink as a medium of exchange or store of value, or may choose to build new services or applications that tap into the Chainlink Network. Financial entities interested in Chainlink may run oracle nodes or otherwise integrate Chainlink into their services.

Investment and Speculative Sector

The investment and speculative sector includes both private and professional investors who trade Chainlink as an asset. Many participants in the Chainlink market engage in speculative trading, buying and selling Chainlink to profit from market fluctuations. While institutional involvement is limited compared to more established assets, the Chainlink market continues to grow in popularity among retail investors, especially with Chainlink’ increased presence in digital asset trading platforms and rising interest in memecoins.

Retail Sector

The retail sector consists of users who engage in direct peer-to-peer Chainlink transactions. These users send Chainlink over the network to pay for goods or services. While Chainlink is not yet a widely accepted form of payment, and may never become one, there could be interest from consumers and businesses adopting Chainlink for various types of transactions, including online payments and tipping. However, its use as a mainstream payment method remains limited compared to other cryptocurrencies like Bitcoin.

Service Sector

The service sector includes companies that provide a variety of services related to Chainlink, such as buying, selling, payment processing, and custodial services. Major cryptocurrency exchanges, such as Coinbase, Kraken, and Binance, allow users to trade Chainlink. Additionally, there are custodial services that allow users to store Chainlink securely. As the Chainlink Network continues to grow in popularity, it is expected that more service providers will emerge, offering a wider range of services and expanding the overall ecosystem.

Competition

As of February 11, 2026, more than 17,000 other digital assets, as tracked by CoinGecko, have been developed since the inception of bitcoin, which is currently the most developed digital asset because of the length of time it has been in existence, the investment in the infrastructure that supports it, and the network of individuals and entities that are using bitcoin in transactions. While Chainlink has enjoyed some success in its limited history, the aggregate value of outstanding Chainlink is smaller than that of bitcoin and ether and may be eclipsed by the more rapid development of other digital assets.

The Trust and Chainlink Prices

10

Overview of the Trust

The Trust’s primary investment objective is to seek to provide exposure to the value of Chainlink held by the Trust, less the expenses of the Trust’s operations. In seeking to achieve its primary investment objective, the Trust will hold Chainlink and will value its net assets and the Shares daily based on the Pricing Benchmark. Chainlink will be the only digital asset held by the Trust.

The Sponsor believes that the Trust will provide a cost-efficient way for investors to implement strategic and tactical asset allocation strategies that use Chainlink by investing in the Shares rather than purchasing, holding and trading Chainlink directly. The latter alternative would require an investor to acquire Chainlink by selecting a digital asset trading platform and opening an account or arranging a private transaction, and initiating a fiat transaction to initiate or settle such acquisition. An investor would then also be required to custody such Chainlink by selecting a retail or institutional custodial platform or establishing a personal computer or hardware security module-based system capable of transacting directly on the blockchain, and incurring the risk associated with cybersecurity and maintaining a private key that is irrecoverable if lost, among other difficulties.

Purchase and Sale of Chainlink

When the Trust conducts Cash Creations or Cash Redemptions, it is responsible for purchasing and selling Chainlink. The Trust may also be required to sell Chainlink to pay certain extraordinary, non-recurring expenses that are not assumed by the Sponsor.

Under such circumstances, the Sponsor, on behalf of the Trust, will typically seek to buy and sell Chainlink at a price as close to the Pricing Benchmark as practical. When choosing between potential counterparties, the Sponsor may consider factors other than simply the most favorable price. However, the most favorable price will be the predominant factor in determining the counterparty with which the Sponsor effectuates the contemplated transaction. Other factors that the Sponsor may consider include the size of the proposed order, as well as a counterparty’s execution capabilities, reliability and responsiveness.

The Trust’s purchase and sale of Chainlink may be conducted pursuant to either of two models: (i) the “Trust-Directed Trade Model”; or the (ii) the “Agent Execution Model.” The Trust intends to utilize the Trust-Directed Trade Model for all purchases and sales of Chainlink and will only utilize the Agent Execution Model in the event that no Chainlink Trading Counterparty is able or willing to effectuate the Trust’s purchase or sale of Chainlink.

Trust-Directed Trade Model

Under the Trust-Directed Trade Model, the Sponsor, on behalf of the Trust, is responsible for acquiring Chainlink from a Chainlink trading counterparty that has been approved by the Sponsor (each, a “Chainlink Trading Counterparty”). The Sponsor has entered into contractual agreements with the Chainlink Trading Counterparties, and these agreements set forth the general parameters under which a transaction in Chainlink will be effectuated, should any transaction with a Chainlink Trading Counterparty occur. These agreements do not require the Sponsor to utilize any particular Chainlink Trading Counterparty, and do not create any contractual obligations on the part of any Chainlink Trading Counterparty to participate in cash orders for creations or redemptions. All transactions between the Sponsor, on behalf of the Trust, and a Chainlink Trading Counterparty will be done on an arm’s-length basis.

While it is expected and intended that the Chainlink Trading Counterparties are unaffiliated third-parties, it is possible that a Chainlink Trading Counterparty may on any given day be or become considered an affiliate of the Trust if it acquires Shares in an amount that would cause it to become considered an affiliate of the Trust, as the Shares are publicly traded. Chainlink Trading Counterparties are not required to have a custody account with the Chainlink Custodian. When seeking to purchase or sell Chainlink on behalf of the Trust, the Sponsor will typically seek to buy and sell Chainlink at a price as close to the Pricing Benchmark as practical from any of the approved Chainlink Trading Counterparties. Upon notification that the Trust needs to purchase or sell Chainlink, the Sponsor will obtain indicative prices from multiple Chainlink Trading Counterparties at which they would be willing to execute the contemplated transaction. The Sponsor then determines the Chainlink Trading Counterparty with which it wishes to transact and records the rationale for that determination. Once agreed upon, the transaction will generally occur on an “over-the-counter” basis. Transfers of Chainlink to and from the Trust Chainlink Account to the Chainlink Trading Counterparty are “on-chain” transactions represented on the Ethereum Blockchain. Transfer fees with respect to this on-chain transfer of Chainlink will be paid by the Chainlink Custodian. The Chainlink Custodian will not pay such transfer fees with the Trust’s assets.

11

The Sponsor maintains a process for approving and monitoring Chainlink Trading Counterparties, which is overseen by the Bitwise Portfolio Oversight Committee, which is responsible for investment activities and related risk, as well as counterparty risk. All Chainlink Trading Counterparties must be approved by the Bitwise Portfolio Oversight Committee before the Sponsor, on behalf of the Trust, will engage in transactions with the entity. The Bitwise Portfolio Oversight Committee continuously reviews all approved Chainlink Trading Counterparties at its quarterly meetings and will reject the approval of any previously approved Chainlink Trading Counterparty if new information arises regarding the entity that puts the appropriateness of that entity as an approved Chainlink trading counterparty in doubt. In considering which Chainlink Trading Counterparties to approve, the Bitwise Portfolio Oversight Committee has instituted rigorous policies and procedures that include, but are not limited to, (i) a review of all sanctioned entities, including, but not limited to, the various categories of sanctioned persons and entities identified by the Office of Foreign Assets Control; (ii) a review of all publicly available information regarding the entity, including a review of all information that has been filed pursuant to the requirements of U.S. or non-U.S. regulators, with a particular emphasis on the identity of the entity’s owners, disclosure events and reports of disciplinary action; and (iii) a review of the entity’s policies and procedures regarding various topics, including, but not limited to, anti-money laundering and “know-your-customer” requirements, trade surveillance, auditing and testing and cybersecurity capabilities.

As of January 5, 2026, Nonco LLC and Virtu Americas LLC have been approved as Chainlink Trading Counterparties.

Agent Execution Model

In the event that every Chainlink Trading Counterparty is either unable or unwilling to effectuate the Trust’s purchase or sale of Chainlink, the Sponsor, on behalf of the Trust, may execute the trade using the Agent Execution Model.

Under the Agent Execution Model, the Prime Execution Agent, an affiliate of the Chainlink Custodian, acting in an agency capacity, conducts Chainlink purchases and sales on behalf of the Trust with third parties through its Coinbase Prime service pursuant to the Prime Execution Agreement. To avoid having to pre-fund purchases or sales of Chainlink, the Trust may borrow Chainlink or cash as Trade Credit from the Trade Credit Lender on a short-term basis pursuant to the Trade Financing Agreement. As the Trust intends to conduct nearly all purchases and sales of Chainlink pursuant to the Trust-Directed Trade Model, under normal conditions, it expects to keep very little or no Chainlink in the Trading Balance with the Prime Execution Agent.

In the case of a purchase of Chainlink, the extension of Trade Credits allows the Trust to purchase Chainlink through the Prime Execution Agent on the date the Trust wishes to effectuate the transaction (for instance, on the evening of the day when an order to create Shares is received), with such Chainlink being deposited in the Trust’s Trading Balance. On the day following a trade when Trade Credits have been utilized, the Trust uses cash (for instance, from the Authorized Participant who submitted the creation order) to repay the Trade Credits borrowed from the Trade Credit Lender. The Chainlink purchased by the Trust is then swept from the Trust’s Trading Balance with the Prime Execution Agent to the Trust Chainlink Account with the Chainlink Custodian pursuant to a regular end-of-day sweep process. Transfers of Chainlink into the Trust’s Trading Balance are off-chain transactions and transfers from the Trust’s Trading Balance to the Trust Chainlink Account are “on-chain” transactions represented on the Ethereum Blockchain. Any financing fee owed to the Trade Credit Lender is deemed part of trade execution costs and embedded in the trade price for each transaction.

In the case of a sale of Chainlink, the Trust enters into a transaction to sell Chainlink through the Prime Execution Agent for cash. The Trust’s Trading Balance with the Prime Execution Agent may not be funded with Chainlink on the date the Trust wishes to effectuate the transaction (for instance, on the evening a day when an order to redeem Shares is received) because the Chainlink remains in the Trust Chainlink Account with the Chainlink Custodian. In those circumstances the Trust may borrow Trade Credits in the form of Chainlink from the Trade Credit Lender, which allows the Trust to sell Chainlink through the Prime Execution Agent at the desired time, and the cash proceeds are deposited in the Trust’s Trading Balance with the Prime Execution Agent. On the business day following the trade, the Trust will use the Chainlink that is moved from the Trust Chainlink Account with the Chainlink Custodian to the Trading Balance with the Prime Execution Agent to repay the Trade Credits borrowed from the Trade Credit Lender. Transfers of Chainlink from the Trust Chainlink Account to the Trust’s Trading Balance are “on-chain” transactions represented on the Ethereum Blockchain. Any financing fee owed to the Trade Credit Lender is deemed part of trade execution costs and embedded in the trade price for each transaction.

The CME CF Chainlink–Dollar Reference Rate – New York Variant

The net assets of the Trust and its Shares are valued on a daily basis with reference to the CME CF Chainlink–Dollar Reference Rate – New York Variant, the Pricing Benchmark, a standardized reference rate published by CF Benchmarks

12

Ltd., the Benchmark Provider, that is designed to reflect the performance of Chainlink in U.S. dollars. The Pricing Benchmark was created to facilitate financial products based on Chainlink. It serves as a once-a-day benchmark rate of the U.S. dollar price of Chainlink (USD/Chainlink), calculated as of 4:00 p.m. ET. The Pricing Benchmark aggregates the trade flow of several major Chainlink trading venues, during an observation window between 3:00 p.m. and 4:00 p.m. ET into the U.S. dollar price of one Chainlink at 4:00 p.m. ET. The Pricing Benchmark currently uses substantially the same methodology as the CRR, including utilizing the same constituent Chainlink exchanges, except that the Pricing Benchmark is calculated as of 4:00 p.m. ET, whereas the CRR is calculated as of 4:00 p.m. London time.

The Pricing Benchmark is designed based on the IOSCO Principals for Financial Benchmarks. The Trust uses the Pricing Benchmark to calculate its NAV, which is the aggregate U.S. dollar value of Chainlink in the Trust, based on the Pricing Benchmark, less its liabilities and expenses. “NAV per Share” is calculated by dividing NAV by the number of Shares currently outstanding. NAV and NAV per Share are not measures calculated in accordance with GAAP. NAV is not intended to be a substitute for the Trust’s Principal Market NAV calculated in accordance with GAAP, and NAV per Share is not intended to be a substitute for the Trust’s Principal Market NAV per Share calculated in accordance with GAAP.

The Sponsor, in its sole discretion, may cause the Trust to price its portfolio based upon an index, benchmark or standard other than the Pricing Benchmark at any time, with prior notice to the Shareholders, if investment conditions change or the Sponsor believes that another index, benchmark or standard better aligns with the Trust’s investment objectives and strategies. The Sponsor may make this decision for a number of reasons, including, but not limited to, a determination that the Pricing Benchmark price of Chainlink differs materially from the global market price of Chainlink and/or that third parties are able to purchase and sell Chainlink on public or private markets not included among the Constituent Platforms, and such transactions may take place at prices materially higher or lower than the Pricing Benchmark price. The Sponsor, however, is under no obligation whatsoever to make such changes in any circumstance. In the event that the Sponsor intends to establish the Trust’s NAV by reference to an index, benchmark or standard other than the Pricing Benchmark, it will provide Shareholders with notice in a current report on Form 8-K or in the Trust’s annual or quarterly reports.

Pricing Benchmark Methodology

The Pricing Benchmark is calculated based on the “Relevant Transactions” (as defined below) of all of its Constituent Platforms as follows:

•
All Relevant Transactions are added to a joint list, recording the time of execution, trade price and size for each transaction.

•
The list is partitioned by timestamp into twelve (12) equally sized time intervals of five (5) minutes in length.

•
For each partition separately, the volume-weighted median trade price is calculated from the trade prices and sizes of all Relevant Transactions, i.e., across all Constituent Platforms. A volume-weighted median differs from a standard median in that a weighting factor, in this case trade size, is factored into the calculation.

•
The Pricing Benchmark is then determined by the equally weighted average of the volume medians of all partitions.

As of August 29, 2025, the Constituent Platforms included in the Pricing Benchmark are Bitstamp, Coinbase, Crypto.com, Gemini and Kraken.

•
Bitstamp: Bitstamp is a Luxembourg-headquartered trading venue, regulated in the EU and operating under MiCA, with additional licenses in the US and UK. In April 2016, Bitstamp Europe SA was granted a license by the Luxembourg Finance Ministry as a Payment Institution, passportable across the EU’s 28 member states. Additionally, Bitstamp is registered as a Crypto-Asset Service Provider under the EU’s Markets in Crypto Assets (MiCa) regime. Through Bitstamp USA, Inc., the firm also holds a BitLicense and Virtual Currency Business Activity license from the New York State Department of Financial Services ("NYDFS"). Bitstamp was acquired by Robinhood, a US firm, in June 2025.

•
Coinbase: A U.S.-based exchange registered as an MSB with FinCEN and licensed as a virtual currency business under the NYDFS BitLicense as well as a money transmitter in various U.S. states. Subsidiaries operating internationally are further regulated as e-money providers (Republic of Ireland, Central Bank of Ireland) and Major Payment Institutions (Singapore, Monetary Authority of Singapore).

•
Crypto.com: A Singapore-based trading platform that has entities registered as MSBs with FinCEN, and that is licensed as a money transmitter in various U.S. states and chartered as a non-depository trust company by the New Hampshire Banking Department. Crypto.com does not hold a BitLicense.

13

•
Gemini: A U.S.-based exchange that is licensed as a virtual currency business under the NYDFS BitLicense. It is also registered with FinCEN as an MSB and is licensed as a money transmitter in various U.S. states. It is also registered with the FCA as a Crypto Asset Business.

•
Kraken: A U.S.-based exchange that is registered as an MSB with FinCEN in various U.S. states, Kraken is registered with the FCA as a Crypto Asset Business and is authorized by the Central Bank of Ireland as a Virtual Asset Service Provider. Kraken also holds a variety of other licenses and regulatory approvals, including from the Canadian Securities Administrators.

An oversight function is implemented by the Benchmark Provider in seeking to ensure the Pricing Benchmark is administered through codified policies for index integrity. This framework includes a comprehensive conflicts-of-interest policy, a control framework, an accountability framework, and an input data policy. The Pricing Benchmark is subject to the U.K. Benchmarks Regulation (U.K. BMR), and as of January 2026, continues to operate under the supervision of the Financial Conduct Authority (FCA). Compliance with these regulations is subject to an annual Limited Assurance Audit under the ISAE 3000 standard; The most recent audit was completed for the period ending September 2025 and is publicly available.

The Pricing Benchmark is subject to oversight by the CME CF Oversight Committee. The CME CF Oversight Committee shall be comprised of at least five members, including at least: (i) two who are representatives of CME; (ii) one who is a representative of CF Benchmarks Ltd.; and (iii) two who bring expertise and industry knowledge relating to benchmark determination, issuance and operations. The CME CF Oversight Committee meets no less frequently than quarterly. The CME CF Oversight Committee’s Founding Charter and quarterly meeting minutes are publicly available.

In the event that there are errors or irregularities in the calculation and publication of the Pricing Benchmark, including delayed, missing data or erroneous data, the Benchmark Provider will apply the “Contingency Calculation Rules” as they relate to the Pricing Benchmark that are set forth on the Benchmark Provider’s website. The use of the Contingency Calculation Rules could negatively impact the NAV of the Trust. Such rules dictate how the Benchmark Provider will calculate the Pricing Benchmark, depending upon the type of error or irregularity. For instance, in the event that no Relevant Transaction occurs on a Constituent Platform on a given day, or one or more Relevant Transactions do occur on the Constituent Platform but cannot be retrieved by the Benchmark Provider, the Constituent Platform is disregarded in the calculation of the Pricing Benchmark for that day. In addition, all Relevant Transactions are subject to automated screening for erroneous data. Relevant Transactions that have been flagged as erroneous pursuant to the automated screening and the Contingency Calculation Rules are disregarded in the calculation of the Pricing Benchmark for a given day. If, for whatever reason, the Benchmark Provider is unable to calculate and publish the Pricing Benchmark by the stipulated dissemination time, it shall publish a notification on its website informing Pricing Benchmark users, including the Trust, the calculation and publication have been delayed.

Pricing Benchmark data and the description of the Pricing Benchmark are based on information made publicly available by the Benchmark Provider on its website at https://www.cfbenchmarks.com. None of the information on the Benchmark Provider’s website is incorporated by reference into this Annual Report.

The Sponsor, in its sole discretion, may cause the Trust to price its portfolio based upon an index, benchmark or standard other than the Pricing Benchmark at any time, with prior notice to the Shareholders, if investment conditions change or the Sponsor believes that another index, benchmark or standard better aligns with the Trust’s investment objective and strategy. The Sponsor may make this decision for a number of reasons, including, but not limited to, a determination that the Pricing Benchmark price of ether differs materially from the global market price of ether and/or that third parties are able to purchase and sell ether on public or private markets not included among the Constituent Platforms, and such transactions may take place at prices materially higher or lower than the Pricing Benchmark price. The Sponsor, however, is under no obligation whatsoever to make such changes in any circumstance. In the event that the Sponsor intends to establish the Trust’s NAV by reference to an index, benchmark or standard other than the Pricing Benchmark, it will provide Shareholders with notice in a prospectus supplement and/or through a Current Report on Form 8-K or in the Trust’s annual or quarterly reports.

Calculation of Net Asset Value ("NAV")

Under normal circumstances, the Trust’s only asset will be Chainlink and, under limited circumstances, cash. The Trust’s Chainlink is carried, for financial statement purposes, at fair value, as required by the U.S. generally accepted accounting principles (“GAAP”). The Trust’s NAV will be determined by the Administrator once each Exchange trading day at 4:00 p.m. ET, or as soon thereafter as practicable. The NAV for a normal trading day will be released after 4:00 p.m. ET. Trading during the core trading session on the Exchange typically closes at 4:00 p.m. ET. However, NAVs are not officially struck until later in the day (often by 5:30 p.m. and almost always by 8:00 p.m.). The pause between 4:00 p.m. and 5:30 p.m. (or

14

later) provides an opportunity for the Sponsor to algorithmically detect, flag, investigate, and correct unusual pricing should it occur.

The Administrator will calculate the NAV of the Trust by multiplying the number of Chainlink held by the Trust by the Pricing Benchmark for such day, adding any additional receivables and subtracting the accrued but unpaid expenses and liabilities of the Trust. The Trust’s NAV per Share is calculated by dividing the Trust’s NAV by the number of Shares then outstanding. The Administrator will determine the price of the Trust’s Chainlink by reference to the Pricing Benchmark, which is published between 4:00 p.m. and 4:30 p.m. ET on every calendar day. The methodology used to calculate the Pricing Benchmark price to value Chainlink in determining the NAV of the Trust may not be deemed consistent with GAAP. To the extent the methodology used to calculate the Pricing Benchmark is deemed inconsistent with GAAP, the Trust will utilize an alternative GAAP-consistent pricing source for purposes of the Trust’s periodic financial statements.

The Trust’s periodic financial statements may not utilize the NAV of the Trust determined by reference to the Pricing Benchmark to the extent the methodology used to calculate the Pricing Benchmark is deemed not to be consistent with GAAP. The Trust’s periodic financial statements are prepared in accordance with the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 820, “Fair Value Measurements and Disclosures” (“ASC Topic 820”) and utilize an exchange-traded price from the Trust’s principal market for Chainlink on the Trust’s financial statement measurement date.

The Sponsor determines in its sole discretion the valuation sources and policies used to prepare the Trust’s financial

statements in accordance with GAAP. The Trust has engaged a third-party vendor to obtain a price from a principal market

for Chainlink, which is determined and designated by such third-party vendor daily based on its consideration of several

exchange characteristics, including oversight, and the volume and frequency of trades. Under GAAP, such a price is

expected to be deemed a Level 1 input in accordance with the ASC Topic 820 because it is expected to be a quoted price in active markets for identical assets or liabilities. The Trust's NAV and NAV per share are presented in this Annual Report on Form 10-K and are reconciled against GAAP metrics in the financial statements as set forth in Item 8. Financial Statements and Supplementary Data.

Calculation and Dissemination of ITV

The Trust utilizes the CME Chainlink Real Time Price to calculate an Indicative Trust Value (“ITV”). The ITV is

disseminated on a Per-Share basis every 15 seconds during regular Exchange trading hours of 9:30 a.m. to 4:00 p.m. EST. The ITV will be disseminated on a per-Share basis every 15 seconds during regular Exchange core trading session hours of 9:30 a.m. ET to 4:00 p.m. ET. The Exchange will disseminate the ITV value through the facilities of CTA/CQ High Speed Lines that allow for high-speed data transmission. In addition, the ITV will be published on the Exchange’s website and will be available through online information services such as Bloomberg and Reuters. The ITV (which is based upon the CME Chainlink Real Time Price) may differ from the NAV (which is based upon the Pricing Benchmark) due to differences in how the CME Chainlink Real Time Price and Pricing Benchmark are calculated. While the Pricing Benchmark is calculated as described in the section above entitled “THE TRUST AND CHAINLINK PRICES—–The CME CF Chainlink–Dollar Reference Rate – New York Variant,” the CME Chainlink Real Time Price is calculated once per second, in real time by utilizing the order books of Chainlink—U.S. dollar trading pairs operated by all Constituent Platforms. An “order book” is a list of buy and sell orders with associated limit prices and sizes that have not yet been matched, that is reported and disseminated by CF Benchmarks Ltd., as the CME Chainlink Real Time Price calculation agent. The order books are aggregated into one consolidated order book by the CME Chainlink Real Time Price calculation agent and the bid-price volume curve, ask-price volume curve, mid-price volume curve and mid-spread volume curve are calculated. The mid-price volume curve is the average of the bid-price volume curve (which maps transaction volume to the marginal price per cryptocurrency unit a seller is required to accept in order to sell this volume to the consolidated order book) and the ask-price volume curve (which maps a transaction volume to the marginal price per cryptocurrency unit a buyer is required to pay in order to purchase this volume from the consolidated order book). The mid-price volume curve is weighted by the normalized probability density of the exponential distribution up to the utilized depth (utilized depth being calculated as the maximum cumulative volume for which the mid-spread volume curve does not exceed a certain percentage deviation from the mid-price). The CME Chainlink Real Time Price is then given by the sum of the weighted mid-price volume curve obtained in the previous step.

Dissemination of the ITV provides additional information that is not otherwise available to the public and may be useful to investors and market professionals in connection with the trading of the Shares on the Exchange. Investors and market professionals will be able throughout the trading day to compare the market price of the Trust and the ITV. If the market price of the Shares diverges significantly from the ITV, market professionals will have an incentive to execute arbitrage

15

trades. For example, if the Trust appears to be trading at a discount compared to the ITV, a market professional could buy the Shares on the Exchange and sell short futures contracts. Such arbitrage trades can tighten the tracking between the market price of the Trust and the ITV and thus can be beneficial to all market participants.

Creation and Redemption of Shares

When the Trust creates or redeems its Shares, it will do so only in Baskets (blocks of 10,000 Shares) based on the quantity of Chainlink attributable to each Share of the Trust (net of accrued but unpaid expenses and liabilities) multiplied by the number of Shares comprising a Basket (10,000). This is called the “Basket Amount.” The Basket Amount required to create each Basket changes from day to day. On each day that the Exchange is open for regular trading, the Administrator adjusts the quantity of Chainlink constituting the Basket Amount as appropriate to reflect accrued expenses and any loss of Chainlink that may occur. The computation is made by the Administrator each business day prior to the commencement of trading on the Exchange. The Administrator determines the Basket Amount for a given day by dividing the number of Chainlink held by the Trust as of the opening of business on that business day, adjusted for the amount of Chainlink constituting estimated accrued but unpaid fees and expenses of the Trust as of the opening of business on that business day, by the quotient of the number of Shares outstanding at the opening of business, multiplied by 10,000. Fractions of Chainlink smaller than 0.00000001 are disregarded for purposes of the computation of the Basket Amount. The Basket Amount so determined is communicated via electronic mail message to all Authorized Participants and made available on the Sponsor’s website for the Shares. The Exchange also publishes the Basket Amount determined by the Administrator as indicated above.

The Trust may either create and redeem Shares in-kind for Chainlink (In-Kind Creations and In-Kind Redemptions, respectively) or for cash (Cash Creations and Cash Redemptions, respectively). When the Trust creates or redeems its Shares, it does so in blocks of 10,000 Shares (each, a Basket) based on the quantity of Chainlink attributable to each Share of the Trust (net of accrued but unpaid expenses and liabilities) multiplied by the number of Shares (10,000) comprising a Basket (the Basket Amount).

In connection with an In-Kind Creation Order, an Authorized Participant shall deliver or cause to be delivered by an Authorized Participant Designee to the Chainlink Custodian the amount of Chainlink represented by the Basket Amount. In connection with a Cash Creation Order, an Authorized Participant shall deliver to the Transfer Agent the amount of U.S. dollars needed to purchase the Basket Amount of Chainlink, as well as the per-order transaction fee.

In connection with a Redemption Order, an Authorized Participant shall deliver to the Trust’s account at DTC the Basket(s) to be redeemed. To the extent such order is an In-Kind Redemption Order, the Sponsor shall arrange for a Basket Amount of Chainlink to be distributed to a Chainlink account designated by the Authorized Participant or Authorized Participant Designee. To the extent such order is a Cash Redemption Order, the Sponsor shall arrange for the Basket Amount of Chainlink to be sold and the resulting U.S. dollars to be distributed to the Authorized Participant.

Authorized Participants

Authorized Participants are the only persons that may place orders to create and redeem Baskets. Authorized Participants must be (1) registered broker-dealers or other securities market participants, such as banks and other financial institutions, that are not required to register as broker-dealers to engage in securities transactions described below, and (2) DTC Participants. To become an Authorized Participant, a person must enter into an Authorized Participant Agreement. The Authorized Participant Agreement provides the procedures for the creation and redemption of Baskets and for the delivery of the Chainlink, cash or Shares required for such creation and redemptions. The Authorized Participant Agreement and the related procedures attached thereto may be amended by the Trust, without the consent of any Shareholder or Authorized Participant. Authorized Participants must pay the Transfer Agent a non-refundable fee for each Creation Order and Redemption Order they place. The transaction fee may be waived, reduced, increased or otherwise changed by the Sponsor in its sole discretion. Authorized Participants who make deposits with the Trust in exchange for Baskets receive no fees, commissions or other form of compensation or inducement of any kind from either the Trust or the Sponsor, and no such person will have any obligation or responsibility to the Sponsor or the Trust to effect any sale or resale of Shares.

Each Authorized Participant will be required to be registered as a broker-dealer under the Exchange Act and a member in good standing with FINRA, or exempt from being or otherwise not required to be licensed as a broker-dealer or a member of FINRA, and will be qualified to act as a broker or dealer in the states or other jurisdictions where the nature of its business so requires. Certain Authorized Participants may also be regulated under federal and state banking laws and regulations. Each Authorized Participant has its own set of rules and procedures, internal controls and information barriers as it determines is appropriate in light of its own regulatory regime.

16

Under the Authorized Participant Agreement, the Sponsor, and the Trust under limited circumstances, have agreed to indemnify the Authorized Participants against certain liabilities, including liabilities under the 1933 Act, and to contribute to the payments the Authorized Participants may be required to make in respect of those liabilities.

Creation Procedures

On any business day, an Authorized Participant may create Shares by placing a Creation Order to purchase one or more Baskets with the Transfer Agent through the Marketing Agent in exchange for Chainlink or cash. For purposes of processing Creation Orders and Redemption Orders, a “business day” means any day other than a day when the Exchange is closed for regular trading. Creation Orders must be placed by 3:59 p.m., ET or the close of regular trading on the Exchange, whichever is earlier, for In-Kind Creation Orders, or 2:00 p.m., ET, or two hours before the close of regular trading on the Exchange, whichever is earlier, for Cash Creation Orders (the “Order Cut-Off Time”). The Order Cut-Off time may be modified by the Sponsor in its sole discretion. The day on which a Creation Order is accepted by the Transfer Agent is considered the “Creation Order Date.”

The Sponsor may in its sole discretion limit the number of Shares created pursuant to Creation Orders on any specified day without notice to the Authorized Participants and may direct the Marketing Agent to reject any Creation Orders in excess of such capped amount. The Sponsor may choose to limit the number of Shares created pursuant to Creation Orders when it deems so doing to be in the best interest of Shareholders. It may choose to do so when it believes the market is too volatile to execute a Chainlink transaction, when it believes the price of Chainlink is being inconsistently, irregularly, or discontinuously published from Chainlink trading venues and other data sources, or when it believes other similar circumstances may create a scenario in which accepting Creation Orders would not be in the best interests of the Shareholders. The Sponsor does not believe that the Trust’s ability to arrive at such a determination will have a significant impact on the Shares in the secondary market because it believes that the ability to create Shares would be reinstated shortly after such determination is made, and any entity desiring to create Shares would be able to do so once the ability to create Shares is reinstated. However, it is possible that such a determination would cause the Shares to trade at premiums or discounts relative to the Trust’s NAV on the secondary market if arbitrageurs believe that there is risk that the creation and redemption process is not available, as this process is a component of keeping the price of the Shares on the secondary market closely aligned to the Trust’s NAV. The manner by which creations are made is dictated by the terms of the Authorized Participant Agreement.

By placing an In-Kind Creation Order, an Authorized Participant agrees to facilitate (either directly or through an Authorized Participant Designee) the deposit of Chainlink with the Chainlink Custodian. An Authorized Participant who places an In-Kind Creation Order is responsible for facilitating the delivery of the required amount of Chainlink to a Trust Chainlink Account at the Chainlink Custodian by 3:00 p.m. ET, on the business day following the Creation Order Date. The Authorized Participant or Authorized Participant Designee will normally send the required Chainlink in an “on chain” transaction over the Ethereum Blockchain. Such on chain transactions are subject to the risks associated with Ethereum Blockchain transactions, including the irreversibility of transactions made in error or unavoidable delays due to Ethereum Blockchain congestion. Upon receipt of the required amount of Chainlink in a Trust Chainlink Account at the Chainlink Custodian, the Sponsor will notify the Transfer Agent that the Chainlink has been deposited. The Transfer Agent will then direct DTC to credit the number of Shares created to the Authorized Participant’s DTC account.

17

By placing a Cash Creation Order, an Authorized Participant agrees to deposit, or cause the deposit of, cash with the Trust in an equivalent amount of cash equal to the required amount of Chainlink as described above, multiplied by the Pricing Benchmark price, plus any additional cash required to account for the price at which the Trust agrees to purchase the requisite amount of Chainlink to the extent it is greater than the Pricing Benchmark price on each Creation Order Date. On each Creation Order Date, the Administrator will communicate to the Authorized Participant the full cash amount required to settle the transaction. Authorized Participants may not withdraw a Creation Order. If an Authorized Participant fails to consummate the foregoing, the Creation Order will be cancelled. The Sponsor causes to be published each night the amount of Chainlink that will be acquired in exchange for each Creation Order, from which can be computed the estimated amount of cash required to create each Basket, prior to accounting for any additional cash required to acquire the requisite amount of Chainlink if the price paid by the Trust is in excess of the Pricing Benchmark on each Creation Order Date. If the amount of cash required to acquire the requisite amount of Chainlink is less than the amount deposited by the Authorized Participant, the full amount of cash deposited by the Authorized Participant will be returned to the Authorized Participant (at the Authorized Participant’s expense) and the Authorized Participant will then re-send the correct amount.

An Authorized Participant who places a Cash Creation Order is responsible for facilitating the delivery of the required amount of cash to the Cash Custodian by 3:00 p.m. ET, on the business day following the Creation Order Date. Pursuant to a Cash Creation, the Trust is responsible for acquiring Chainlink, which it may do pursuant to two different models: (i) the “Trust-Directed Trade Model,” and the (ii) the “Agent Execution Model.”

Under the Trust-Directed Trade Model, the Sponsor, on behalf of the Trust, is responsible for acquiring Chainlink from an approved Chainlink Trading Counterparty in an amount equal to the Basket Amount. When seeking to purchase Chainlink on behalf of the Trust, the Sponsor will seek to purchase Chainlink at a price as close to the Pricing Benchmark as practical. Once the trade has been agreed upon with a Chainlink Trading Counterparty, the transaction will generally occur on an “over-the-counter” basis. Transfers of Chainlink from the Chainlink Trading Counterparty to a Trust Chainlink Account are “on-chain” transactions represented on the Ethereum Blockchain. Upon receipt of the deposit amount of Chainlink in a Trust Chainlink Account at the Chainlink Custodian from the Chainlink Trading Counterparty, the Chainlink Custodian will notify the Sponsor that the Chainlink has been received. The Sponsor will then notify the Transfer Agent that the Chainlink has been received, and the Transfer Agent will direct DTC to credit the number of Shares ordered to the Authorized Participant’s DTC account and will wire the cash previously sent by the Authorized Participant to the Chainlink Trading Counterparty to complete settlement of the Cash Creation Order and the acquisition of the Chainlink by the Trust. If the Chainlink Trading Counterparty fails to deliver the Chainlink to the Chainlink Custodian, no cash is sent from the Cash Custodian to the Chainlink Trading Counterparty, no Shares are transferred to the Authorized Participant’s DTC account, the cash is returned to the Authorized Participant, and the Cash Creation Order is cancelled.

Under the Agent Execution Model, the Prime Execution Agent, acting in an agency capacity, conducts Chainlink purchases on behalf of the Trust with third parties through its Coinbase Prime service pursuant to the Prime Execution Agreement. On the evening of the Creation Order Date, the Trust enters into a transaction to buy Chainlink through the Prime Execution Agent for cash. Because the Trust’s Trading Balance may not be funded with cash on the Creation Order Date for the purchase of Chainlink in connection with the Cash Creation Order under the Agent Execution Model, the Trust may borrow Trade Credits in the form of cash from the Trade Credit Lender pursuant to the Trade Financing Agreement or may require the Authorized Participant to deliver the required cash for the Cash Creation Order on the Creation Order Date. The extension of Trade Credits on the Creation Order Date allows the Trust to purchase Chainlink through the Prime Execution Agent on the Creation Order Date, with such Chainlink being deposited in the Trust’s Trading Balance. On the day following the Creation Order Date, the “Creation Order Settlement Date,” the Trust delivers Shares to the Authorized Participant’s DTC account in exchange for cash received from the Authorized Participant. Where applicable, the Trust uses the cash to repay the Trade Credits borrowed from the Trade Credit Lender. On the Creation Order Settlement Date for a Cash Creation Order utilizing the Agent Execution Model, the Chainlink associated with the Creation Order and purchased on the Creation Order Date is swept from the Trust’s Trading Balance with the Prime Execution Agent to a Trust Chainlink Account with the Chainlink Custodian pursuant to a regular end-of-day sweep process. Transfers of Chainlink into the Trust’s Trading Balance are off-chain transactions and transfers from the Trust’s Trading Balance to a Trust Chainlink Account are “on-chain” transactions represented on the Ethereum Blockchain. Any financing fee owed to the Trade Credit Lender is deemed part of trade execution costs and embedded in the trade price for each transaction. Accordingly, such costs are borne by the Authorized Participant.

18

As between the Trust and the Authorized Participant, the expense and risk of the difference between the value of Chainlink calculated by the Administrator for daily valuation using the Pricing Benchmark and the price at which the Trust acquires the Chainlink will be borne solely by the Authorized Participant to the extent that the Trust pays more for Chainlink than the price used by the Trust for daily valuation. Any such additional cash amount will be included in the amount of cash calculated by the Administrator on the Creation Order Date, communicated to the Authorized Participant on the Creation Order Date, and wired by the Authorized Participant to the Cash Custodian on the Creation Order Settlement Date.

Rejection of Creation Orders

The Sponsor or its designee has the absolute right, but does not have any obligation, to reject any Creation Order or deposit of cash or Chainlink for any reason, including if the Sponsor determines that:

•
the Creation Order is not in proper form;

•
it would not be in the best interest of the Shareholders;

•
the acceptance of the Creation Order would have adverse tax consequences to the Trust or its Shareholders;

•
the acceptance or receipt of which would, in the opinion of counsel to the Sponsor, be unlawful; or

•
circumstances outside the control of the Trust, the Sponsor, the Marketing Agent, the Transfer Agent, the Cash Custodian or the Chainlink Custodian make it, for all practical purposes, not feasible to process Baskets (including if the Sponsor determines that the investments available to the Trust at that time will not enable it to meet its investment objectives).

None of the Sponsor, the Marketing Agent, the Cash Custodian or the Chainlink Custodian will be liable for the rejection of any Creation Order.

Redemption Procedures

On any business day, an Authorized Participant may place an order for a Redemption Order with the Transfer Agent through the Marketing Agent to redeem one or more Baskets. Redemption Orders must be placed by 3:59 p.m., ET or the close of regular trading on the Exchange, whichever is earlier, for In-Kind Redemption Orders, or 2:00 p.m., ET, or the close of regular trading on the Exchange, whichever is earlier, for Cash Redemption Orders (the “Redemption Order Cut-Off Time”), which. The Redemption Order Cut-Off Time may be modified by the Sponsor in its sole discretion. A Redemption Order will be effective on the date it is accepted by the Transfer Agent (“Redemption Order Date”). The redemption distribution from the Trust in exchange for a redemption of Shares consists of a movement of the Basket Amount of Chainlink or cash representing the Basket Amount of Chainlink, less any trading expenses incurred by the Trust in liquidating the Chainlink, to the redeeming Authorized Participant or its designee. An Authorized Participant may not withdraw a Redemption Order without the prior consent of the Sponsor in its discretion.

In the case of an In-Kind Redemption Order, the redemption distribution from the Trust consists of a movement of Chainlink to the designated wallet address of the Authorized Participant or Authorized Participant Designee. The Authorized Participant must deliver the Shares represented by the Basket to be redeemed to the Trust’s DTC account by end of day ET on the business day following the Redemption Order Date (the “Redemption Order Settlement Date”). Once the Authorized Participant has delivered the Shares represented by the Basket to be redeemed to the Trust’s DTC account and the Transfer Agent has notified the Sponsor that the Shares have been deposited, the Sponsor will cause the transfer of the requisite amount of Chainlink to the Authorized Participant or Authorized Participant Designee. This transfer of Chainlink from the Trust to the Authorized Participant or Authorized Participant Designee will normally be done pursuant to an “on chain” transaction over the Ethereum Blockchain. Such on chain transactions are subject to the risks associated with Ethereum Blockchain transactions, including the irreversibility of transactions made in error or unavoidable delays due to Ethereum Blockchain congestion.

Under the Trust-Directed Trade Model pursuant to a Cash Redemption Order, the procedures by which an Authorized Participant can redeem one or more Baskets mirror the procedures for the creation of Baskets under the Trust-Directed Trade Model with an additional safeguard on Chainlink being removed from a Trust Chainlink Account, which will not occur until cash has been received by the Cash Custodian in an amount equal to the Basket Amount of Chainlink multiplied by the price at which the Trust agrees with the Chainlink Trading Counterparty to sell the Chainlink on the Redemption Order Date. When seeking to sell Chainlink on behalf of the Trust, the Sponsor will seek to sell Chainlink at a price as close to the Pricing Benchmark as practical. Once the trade has been agreed upon with a Chainlink Trading Counterparty, the transaction will

19

generally occur on an “over-the-counter” basis. Transfers of Chainlink from a Trust Chainlink Account to the Chainlink Trading Counterparty are “on-chain” transactions represented on the Ethereum Blockchain. The Authorized Participant must deliver the Shares represented by the Basket to be redeemed to the Trust’s DTC account by end of day ET on the Redemption Order Settlement Date. The Chainlink Custodian will not send the Basket Amount of Chainlink from a Trust Chainlink Account to the Chainlink Trading Counterparty until the Cash Custodian has received the cash from the Chainlink Trading Counterparty and is instructed by the Sponsor to make such transfer. Once the Chainlink Trading Counterparty has sent the cash to the Cash Custodian in an agreed-upon amount to settle the agreed upon sale of the Basket Amount of Chainlink, the Transfer Agent will notify the Sponsor. The Sponsor will then notify the Chainlink Custodian to transfer the Chainlink to the Chainlink Trading Counterparty, and the Transfer Agent will facilitate the redemption of Shares in exchange for cash. Once the Authorized Participant has delivered the Shares represented by the Basket to be redeemed to the Trust’s DTC account, the Cash Custodian will wire the requisite amount of cash to the Authorized Participant. Transfers of Chainlink from a Trust Chainlink Account to the Chainlink Trading Counterparty are “on-chain” transactions represented on the Ethereum Blockchain. In the event that by the end of the day on the Redemption Order Settlement Date, the Trust’s account at DTC shall not have been credited with the total number of Shares corresponding to the total number of Baskets to be redeemed pursuant to such Redemption Order the Transfer Agent shall send to the Authorized Participant and the Sponsor via fax or electronic mail message notice of such fact and the Authorized Participant shall have two (2) business days following receipt of such notice to correct such failure. If such failure is not cured within such two (2) business day period, the Transfer Agent (in consultation with the Sponsor) will cancel such Redemption Order and will send via fax or electronic mail message notice of such cancellation to the Authorized Participant, and the Authorized Participant will be solely responsible for all costs incurred by the Trust, the Transfer Agent, the Sponsor or the Chainlink Custodian related to the cancelled Redemption Order.

Under the Agent Execution Model pursuant to a Cash Redemption Order, the Authorized Participant may be required to submit a Redemption Order by an earlier than normal order cutoff time (the “Redemption Early Order Cutoff Time”). The Redemption Early Order Cutoff Time may be as early as 5:00 p.m. ET on the business day prior to the Redemption Order Date. Once a Redemption Order is received, the Sponsor instructs the Chainlink Custodian to prepare to transfer the Chainlink associated with the Redemption Order from a Trust Chainlink Account with the Chainlink Custodian to the Trust’s Trading Balance with the Prime Execution Agent. For a Redemption Order utilizing the Agent Execution Model, on the evening of the Redemption Order Date, the Prime Execution Agent, acting in an agency capacity, conducts Chainlink sales on behalf of the Trust with third parties through its Coinbase Prime service in exchange for cash. The Trust’s Trading Balance with the Prime Execution Agent may not be funded with Chainlink on the evening of the Redemption Order Date at the time of the intended execution of the sale of Chainlink in connection with the Redemption Order because such Chainlink is still in a Trust Chainlink Account at the Chainlink Custodian. In those circumstances the Trust may borrow Trade Credits in the form of Chainlink from the Trade Credit Lender, which allows the Trust to sell Chainlink through the Prime Execution Agent on the evening of the Redemption Order Date, and the cash proceeds are deposited in the Trust’s Trading Balance with the Prime Execution Agent. Such cash is then transferred to the Cash Custodian. The Trust will subsequently transfer the Basket Amount of Chainlink from a Trust Chainlink Account to the Trust’s Trading Balance with the Prime Execution Agent. Once the Authorized Participant has delivered the Shares represented by the Basket to be redeemed to the Trust’s DTC account, the Cash Custodian will then wire the requisite amount of cash to the Authorized Participant. In the event Trade Credits were used, the Trust will use the Chainlink that is moved from a Trust Chainlink Account with the Chainlink Custodian to the Trading Balance with the Prime Execution Agent to repay the Trade Credits borrowed from the Trade Credit Lender. Transfers of Chainlink from a Trust Chainlink Account to the Trust’s Trading Balance are “on-chain” transactions represented on the Ethereum Blockchain.

Suspension or Rejection of Redemption Orders

The Sponsor may, in its discretion, suspend the right of creation or redemption or may postpone the Redemption Order Settlement Date, for (1) any period during which the Exchange is closed other than customary weekend or holiday closings, or trading on the Exchange is suspended or restricted, (2) any period during which an emergency exists as a result of which the fulfillment of a creation order or the redemption distribution is not reasonably practicable (for example, as a result of an interruption in services or availability of the Prime Execution Agent, Chainlink Custodian, Cash Custodian, Administrator, or other service providers to the Trust, act of God, catastrophe, civil disturbance, government prohibition, war, terrorism, strike or other labor dispute, fire, force majeure, interruption in telecommunications, internet services, or network provider services, unavailability of Fedwire, SWIFT or banks’ payment processes, significant technical failure, bug, error, disruption or fork of the Ethereum Blockchain or Chainlink Network, hacking, cybersecurity breach, or power, internet, or Ethereum Blockchain or Chainlink Network outage, or similar event), or (3) such other period as the Sponsor determines to be necessary for the protection of the Shareholders of the Trust (for example, where acceptance of the U.S. dollars needed to create each Basket would have certain adverse tax consequences to the Trust or its Shareholders). For example, the Sponsor may determine that it is necessary to suspend redemptions to allow for the orderly liquidation of the Trust’s assets. In the event

20

that the Sponsor suspends the right of creation or redemption of Baskets, it shall notify Shareholders on the Trust’s website, in a current report on Form 8-K. Suspension of creation and redemption privileges may adversely impact how the Shares are traded and arbitraged in the secondary market, which could cause Shares to trade at levels materially different (premiums and discounts) from the value of their underlying Chainlink.

If the Sponsor has difficulty liquidating the Trust’s positions (e.g., because of a market disruption event), it may be appropriate to suspend redemptions until such time as such circumstances are rectified. None of the Sponsor, the person authorized to take Redemption Orders in the manner provided in the Authorized Participant Agreement, the Chainlink Custodian or the Cash Custodian will be liable to any person or in any way for any loss or damages that may result from any such suspension or postponement.

In the event that the Sponsor suspends the right of creation or redemption of Baskets, it shall notify Shareholders on the Trust’s website, in a current report on Form 8-K. Suspension of creation and redemption privileges may adversely impact how the Shares are traded and arbitraged in the secondary market, which could cause Shares to trade at levels materially different (premiums and discounts) from the value of their underlying Chainlink.

Redemption Orders must be made in whole Baskets. The Sponsor acting by itself or through the person authorized to take Redemption Orders in the manner provided in the Authorized Participant Agreement may, in its sole discretion, reject any Redemption Order (1) the Sponsor determines not to be in proper form, (2) the fulfillment of which its counsel advises may be illegal under applicable laws and regulations, or (3) if circumstances outside the control of the Sponsor, the person authorized to take redemption orders in the manner provided in the Authorized Participant Agreement or the Chainlink Custodian make it for all practical purposes not feasible for the Shares to be delivered under the Redemption Order. The Sponsor may also reject a Redemption Order if the number of Shares being redeemed would reduce the remaining outstanding Shares to 100,000 Shares (i.e., ten Baskets) or fewer.

Creation and Redemption Transaction Fee

To compensate the Transfer Agent for expenses incurred in connection with the creation and redemption of Baskets, an Authorized Participant is required to pay a transaction fee to the Transfer Agent to create or redeem Baskets, which does not vary in accordance with the number of Baskets in such order. The transaction fee may be reduced, increased or otherwise changed by the Sponsor. No costs or transaction fees associated with creations and redemptions are payable by the Trust.

Tax Responsibility

Authorized Participants are responsible for any transfer tax, sales or use tax, stamp tax, recording tax, value added tax or similar tax or governmental charge applicable to the creation or redemption of Baskets, regardless of whether or not such tax or charge is imposed directly on the Authorized Participant, and agree to indemnify the Sponsor and the Trust if they are required by law to pay any such tax, together with any applicable penalties, additions to tax and interest thereon.

21

Secondary Market Transactions

As discussed above, Authorized Participants are the only persons that may place Creation Orders and Redemption Orders. Authorized Participants must be registered broker-dealers or other securities market participants, such as banks and other financial institutions that are not required to register as broker-dealers to engage in securities transactions. An Authorized Participant is under no obligation to create or redeem Baskets, and an Authorized Participant is under no obligation to offer to the public Shares of any Basket it does create.

Authorized Participants that do offer to the public Shares from the Basket they create will do so at per-Share offering prices that are expected to reflect, among other factors, the trading price of the Shares on the Exchange, the NAV of the Trust at the time the Authorized Participant purchased the Baskets, the NAV of the Shares at the time of the offer of the Shares to the public, the supply of and demand for Shares at the time of sale, and the liquidity of Chainlink or other portfolio investments. Baskets are generally expected to be redeemed when the price per Share is at a discount to the NAV per Share. Shares initially comprising the same Basket but offered by Authorized Participants to the public at different times may have different offering prices. An order for one or more Baskets may be placed by an Authorized Participant on behalf of multiple clients. Authorized Participants who make deposits of Chainlink or cash with the Trust in exchange for Baskets receive no fees, commissions or other forms of compensation or inducement of any kind from either the Trust or the Sponsor, and no such person has any obligation or responsibility to the Sponsor or the Trust to effect any sale or resale of Shares.

Shares are expected to trade in the secondary market on the Exchange. Shares may trade in the secondary market at prices that are lower or higher relative to their NAV per Share. The amount of the discount or premium in the trading price relative to the NAV per Share may be influenced by various factors, including the number of investors who seek to purchase or sell Shares in the secondary market and the liquidity of Chainlink.

The Trust’s Fees and Expenses

The Trust will pay the unitary Sponsor Fee of 0.34% per annum of the Trust’s Chainlink holdings. For a 3-month period commencing on the day the Shares are initially listed on the Exchange, the Sponsor has agreed to waive the entire Sponsor Fee on the first $500 million of Trust assets.

The Sponsor Fee is paid by the Trust to the Sponsor as compensation for services performed under the Trust Agreement and Sponsor Agreement. Except during periods in which all or a portion of the Sponsor Fee is being waived, the Sponsor Fee will accrue daily and will be payable in Chainlink monthly in arrears. The Administrator will calculate the Sponsor Fee on a daily basis by applying a 0.34% annualized rate to the Trust’s total Chainlink holdings, and the amount of Chainlink payable in respect of each daily accrual shall be determined by reference to the Pricing Benchmark.

The NAV of the Trust is reduced each day by the amount of the Sponsor Fee calculated each day. On or about the last day of each month, an amount of Chainlink will be transferred from the Trust Chainlink Account to the Sponsor Chainlink Account equal to the sum of all daily Sponsor Fees accrued for the month in U.S. dollars divided by the Pricing Benchmark on the last day of the month. The Trust is not responsible for paying any fees or costs associated with the transfer of Chainlink to the Sponsor. In exchange for the Sponsor Fee, the Sponsor has agreed to assume and pay the normal operating expenses of the Trust, which include the Trustee’s monthly fee and out-of-pocket expenses, the fees of the Trust’s regular service providers (Cash Custodian, Chainlink Custodian, Prime Execution Agent, Marketing Agent, Transfer Agent and Administrator), exchange listing fees, tax reporting fees, SEC registration fees, printing and mailing costs, audit fees and up to $500,000 per annum in ordinary legal fees and expenses. The Sponsor may determine in its sole discretion based upon prevailing circumstances to assume legal fees and expenses of the Trust in excess of $500,000 per annum. The Sponsor will also pay the costs of the Trust’s organization.

The additional Chainlink generated by the Trust’s future staking program will be subject to fees shared among the Staking Agent(s) and the Sponsor. The amounts owed or paid to the Staking Agent(s) and the Sponsor are collectively referred to as the Staking Expenses. The Staking Expenses will reduce the amount of Chainlink generated from the staking of the Trust’s Chainlink that is ultimately retained by the Trust. The Trust’s NAV will reflect the amount of Chainlink the Trust is entitled to under its staking program after deduction of all Staking Expenses.

22

The Trust may incur certain extraordinary, non-recurring expenses that are not assumed by the Sponsor, including, but not limited to, taxes and governmental charges, any applicable brokerage commissions, financing fees, expenses and costs of any extraordinary services performed by the Sponsor (or any other service provider) on behalf of the Trust to protect the Trust or the Shareholders (including, for example, in connection with any fork of the Ethereum Blockchain or Chainlink Network, any Incidental Rights (as defined below) and any IR Asset (as defined below)), any indemnification of the Cash Custodian, Chainlink Custodian, Prime Execution Agent, Transfer Agent, Administrator or other agents, service providers or counterparties of the Trust, and extraordinary legal fees and expenses, including any legal fees and expenses incurred in connection with litigation, regulatory enforcement or investigation matters.

The Sponsor, from time to time, may temporarily waive all or a portion of the Sponsor Fee in its sole discretion. The Sponsor may notify Shareholders of its intent to commence, or cease, waiving the Sponsor Fee on the Trust’s website, in a current report on Form 8-K and/or in the Trust’s annual or quarterly reports.

In addition, the Sponsor may, in its sole discretion, agree to rebate all or a portion of the Sponsor Fee attributable to Shares held by certain large investors or entities. Any such rebate will be subject to negotiation and written agreement between the Sponsor and the investor/entity on a case-by-case basis. The Sponsor is under no obligation to provide any rebates of the Sponsor Fee. Neither the Trust nor the Trustee will be a party to any Sponsor Fee rebate arrangements negotiated by the Sponsor.

The Administrator and/or the Sponsor will direct the Chainlink Custodian to transfer Chainlink from the Trust Chainlink Account to the Sponsor Chainlink Account to pay the Sponsor Fee and any other Trust expenses not assumed by the Sponsor. To pay for expenses not assumed by the Sponsor that are denominated in U.S. dollars, the Sponsor, on behalf of the Trust, may sell the Trust’s Chainlink as necessary to pay such expenses. The Sponsor, on behalf of the Trust, will typically seek to buy and sell Chainlink at a price as close to the Pricing Benchmark as practical. Such sales will be undertaken pursuant to the Trust-Directed Trade Model unless no Chainlink Trading Counterparty is willing or able to effectuate the trade. Transfers of Chainlink from the Trust Chainlink Account to the Sponsor Chainlink Account, and from the Sponsor Chainlink Account to the Chainlink Trading Counterparty are “on-chain” transactions represented on the Ethereum Blockchain. Transfer fees with respect to this on-chain transfer of Chainlink will be paid by the Chainlink Custodian. The Chainlink Custodian will not pay such transfer fees with the Trust’s assets. The cash proceeds of the sale will be sent to the Sponsor, which will use such proceeds to pay the expenses. Any remaining cash will be distributed back to the Cash Custodian. To the extent that the Trust must utilize the Agent Execution Model to undertake Chainlink sales to pay for expenses not assumed by the Sponsor, the Prime Execution Agent, acting in an agency capacity, would conduct the sale on behalf of the Trust with third parties through its Coinbase Prime service pursuant to the Prime Execution Agreement. Transfers of Chainlink from the Trust Chainlink Account to the Trust’s Trading Balance in connection with such sales are “on-chain” transactions represented on the Ethereum Blockchain. Each delivery or sale of Chainlink by the Trust to pay the Sponsor Fee or other Trust expenses will be a taxable event to Shareholders. See “United States Federal Income Tax Consequences.”

The Trust does not engage in any activity designed to derive a profit from changes in the price of Chainlink. Chainlink not needed to redeem Baskets, or to cover the Sponsor Fee and Trust expenses not assumed by the Sponsor, is held by the Chainlink Custodian or Prime Execution Agent. As a result of the recurring deliveries of Chainlink necessary to pay the Sponsor Fee and potential sales of Chainlink to pay in cash the Trust expenses not assumed by the Sponsor, the NAV of the Trust and, correspondingly, the amount of Chainlink represented by each Share will decrease proportionately over the life of the Trust. New deposits of Chainlink, purchased with the cash received in connection with Cash Creations of Baskets, will not reverse this trend.

Forks

In the event of a hard fork in the Ethereum Blockchain or Chainlink Network, the Sponsor will, pursuant to the terms of the Trust Agreement, use its discretion to determine which blockchain should properly be considered the issuer of the Chainlink digital asset for the Trust’s purposes. The Sponsor will base its determination on a range of relevant factors at the time, including, but not limited to, the Sponsor’s views regarding the expectations of Chainlink core developers, users, service providers, businesses, validators, and other stakeholders, as well as the actual ongoing acceptance of, validation support for, and community engagement with the Ethereum Blockchain or Chainlink Network. There is no assurance that the Sponsor will select the fork or version of Chainlink that ultimately proves to be the most valuable, and this decision could negatively impact the value of the Shares. Additionally, the Sponsor may have a differing view from Shareholders, the Chainlink

23

Custodian, security vendors, or the Benchmark Provider as to what is generally accepted as Chainlink and should therefore be considered “Chainlink” for the Trust’s purposes, which could also adversely affect the value of the Shares.

Distributions

Pursuant to the terms of the Trust Agreement, the Trust may make distributions on the Shares in cash or in kind.

If the Trust is required to terminate and liquidate, or the Sponsor determines in accordance with the terms of the Trust Agreement that it is appropriate to terminate and liquidate the Trust, the Sponsor will sell the Trust’s Chainlink and will distribute to the Shareholders any amounts of the cash proceeds of the liquidation remaining after the satisfaction of all outstanding liabilities of the Trust and the establishment of reserves for applicable taxes, other governmental charges and contingent or future liabilities as the Sponsor will determine. Under no circumstances will the Trust distribute Chainlink to Shareholders.

Brokerage Fees and Trust Expenses

The Trust pays all of the brokerage commissions, financing fees, Chainlink network fees and similar transaction fees in connection with the Trust’s Chainlink trading activities.

Employees

The Trust has no employees.

Emerging Growth Company Status

The Trust is an “emerging growth company” as that term is used in the Jumpstart Our Business Startups Act (the “JOBS Act”) and, as such, may elect to comply with certain reduced reporting requirements. For as long as the Trust is an emerging growth company, unlike other public companies, it will not be required to:

•
provide an auditor’s attestation report on management’s assessment of the effectiveness of its system of internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act of 2002;

•
comply with any new requirements adopted by the Public Company Accounting Oversight Board (“PCAOB”) requiring mandatory auditor rotation or a supplement to the auditor’s report in which the auditor would be required to provide additional information about the audit and the financial statements of the issuer;

•
comply with any new audit rules adopted by the PCAOB after April 5, 2012, unless the SEC determines otherwise;

•
provide certain disclosure regarding executive compensation required of larger public companies; or

•
obtain shareholder approval of any golden parachute payments not previously approved.

The Trust will cease to be an “emerging growth company” upon the earliest of (i) when it has $1.235 billion or more in total annual gross revenues during its most recently completed fiscal year; (ii) when it is deemed to be a large accelerated filer under Rule 12b-2 promulgated pursuant to the Securities Exchange Act of 1934, as amended; (iii) when it has issued more than $1.0 billion of non-convertible debt over a three-year period; or (iv) the last day of the fiscal year following the fifth anniversary of its initial public offering.

In addition, Section 107 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended, for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies; however, the Trust is choosing to “opt out” of such extended transition period, and as a result, the Trust will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for non-emerging growth companies. Section 107 of the JOBS Act provides that the Trust’s decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable.

24