SecProbe.io

CORRESP
1
filename1.htm

December 22, 2023

Peter J. Shea

Peter.Shea@klgates.com

T +1 212 536 3988

F +1 212 536 3901

Via
EDGAR

U.S. Securities and Exchange Commission

Division of Corporation Finance

Office of Crypto Assets

100 F Street, N.E.

Washington, DC 20549

    Re:

    Tidal Commodities Trust I

    Hashdex Bitcoin ETF

    Filing of Registration Statement on Form S-1 &

    Comment Response to Prior Submission of Draft Registration
    Statement on Form S-1 ((File No. 377-06858)

 Dear Ladies and Gentlemen:

On behalf of our client,
Tidal Commodities Trust I, a Delaware statutory trust (the “Registrant”), which will operate as a separate series of
the Registrant the Hashdex Bitcoin ETF (the “Fund”), we are filing together with this correspondence, the Registrant’s
registration statement on Form S-1 (“Registration Statement”). The Registration Statement and this correspondence provide
the Registrant’s responses to comments of the staff (the “Staff”) of the Securities and Exchange Commission (the
“Commission”) presented in the Staff’s comment letter dated December 13, 2023 (“Comment Letter”),
addressing the Registrant’s Amendment No. 1 to the confidential, non-public draft registration statement on Form S-1 that was submitted
on November 14, 2023 (File No. 377-06858).

Each of the Staff’s
comments from the Comment Letter is repeated below in italics and followed by the Registrant’s response. Capitalized terms used,
but not defined, herein are used with the same meaning given to them in the Amendment. Any disclosure changes made in response to the
Staff’s comments, as set forth below, in one place are also made in other applicable places of the prospectus contained in the Amendment.

Amendment No. 1 to Draft Registration Statement
on Form S-1

General

 1. Please revise to describe the AML and KYC procedures conducted by the Fund and any applicable service
providers.

RESPONSE:

Disclosure of AML and KYC procedures
for the Fund and any applicable service providers is included in the prospectus contained in the Registration Statement (the “Prospectus”)
under the caption “The Fund’s Operating Risks – Anonymity and illicit financing risk”.

K&L
GATES LLP

599 LEXINGTON AVENUE NEW YORK NY 10022-6030

T +1 212 536 3900 F +1 212 536 3901 klgates.com

2.
To the extent that you intend to use an updated fact sheet, please provide a copy for our review.

RESPONSE:

The Registrant has provided supplementally
with this correspondence a draft copy of the updated fact sheet.

3.
Please provide us with an update on the status of any review being conducted by the NFA and provide us with copies of any comments
issued and your responses to those comments. Please also tell us whether there are any limitations, conditions or other restrictions on
your activities as a commodity pool as it relates to your intentions to hold a mix of bitcoin and bitcoin futures.

RESPONSE:

Contemporaneously with the filing
of the Registration Statement, the Registrant has submitted the Registration Statement to the NFA for review. There are no limitations,
conditions or other restrictions on the Fund’s activities as a commodity pool as it relates to the Fund’s portfolio of bitcoin,
Bitcoin Futures Contracts and cash and cash equivalents beyond those already disclosed in the Prospectus.

Prospectus Summary

4.
Please revise to disclose here whether the Fund is a passive or active investment vehicle. Please also disclose, if true, that
the Fund, the Sponsor and the service providers will not loan or pledge the Fund's assets, nor will the Fund's assets serve as collateral
for any loan or similar arrangement.

RESPONSE:

The suggested revisions and disclosures
appear under the caption “Prospectus Summary – The Fund’s Investment Objective”.

5.
Please revise your disclosure here to provide quantitative information that demonstrates the volatility of the price of bitcoin
and Bitcoin Futures Contracts.

RESPONSE:

The suggested disclosure revisions
have been made under the caption “Prospectus Summary – Principal Investment Risk of an Investment in the Fund”.

6.
Please revise your disclosure here to address the risks associated with the competition you will face in launching and sustaining
your product, including the risk that your timing in reaching the market and your fee structure relative to other bitcoin-related ETPs
could have a detrimental effect on the scale and sustainability of your product.

RESPONSE:

A summary discussion of principal
risks related to competition and its effects on scale and sustainability of the Fund have been added under the caption “Prospectus
Summary – Principal Investment Risk of an Investment in the Fund”.

    2

7.
Please revise to disclose here to provide quantitative information that summarizes the historical range between the NAV per share
and price of Shares in the secondary market. Similarly, please revise to provide quantitative information that summarizes the historical
range between the Benchmark and the NAV of the Fund.

RESPONSE:

Quantitative information that
summarizes the historical range between the NAV per share and price of Shares in the secondary market has been added as a new caption
entitled “Share Price Premium and Discount” in the “Prospectus Summary” as suggested.

Please be advised that the Fund
and the Predecessor Fund currently do not use the Benchmark for any purpose, and the Fund does not have information comparing its and
the Predecessor Fund’s performance to the Benchmark. The Fund and the Predecessor Fund invest only in Bitcoin Futures Contracts,
cash and cash equivalents at this time and currently benchmark their performance against an index that reflects only the CME closing settlement
prices of certain Bitcoin Futures Contracts. Consequently, a presentation of data summarizing the historical range between the Benchmark
and NAV of the Fund would be misleading, and the Registrant declines to provide this information in the Prospectus. When the Fund is able
to implement the investment strategy described in the Prospectus, it will undertake to provide periodically such comparative data on its
website and in future filings with the Commission.

The Benchmark Methodology

8.
We note your disclosure on page 2 that the CIOC approves any material changes to the methodology and reviews the Benchmark methodology
at least on an annual basis. Please revise to disclose whether Shareholders will be notified of any material changes to the Benchmark,
and, if so, how. In addition, please identify the Core Exchanges of the Benchmark here. In this regard, we note that you identify the
Constituent Exchanges of the CF Bitcoin Reference Rate on page 4 but do not identify the Benchmark Core Exchanges.

RESPONSE:

The suggested disclosure regarding
notice to Shareholders in the event of material changes to the Benchmark has been made in the Prospectus Summary. In addition, the suggested
Core Exchanges information have been added as well.

Bitcoin Future Contracts

9.
We note your disclosure on page 3 that you will invest in bitcoin, BTC Contracts and MBT Contracts "to the extent necessary"
to achieve exposure to the bitcoin futures market. Please clarify here what you mean by "to the extent necessary." In addition,
please clarify what you mean by your statement that there is a December CME Bitcoin Futures Contract "if there is only one contract
expiring in December at that point in time."

RESPONSE:

The phrase “to the extent
necessary” has been deleted as surplusage, and the related disclosures have been clarified as suggested.

    3

The Fund's Investment Strategies

10.
Please revise to disclose the number of BTC Contracts, MBT Contracts, bitcoin, cash and cash equivalents that you hold as of the
most recent practicable date, and revise to describe your policies regarding (i) how you determine the percentage of Bitcoin Futures Contracts
and the percentage of bitcoin held by the Fund, (ii) the amount of cash and cash equivalents held by the Fund and (iii) how often you
engage in transactions to rebalance the percentage of Bitcoin Futures Contracts and bitcoin held.

RESPONSE:

The suggested disclosure revisions
have been made in the Prospectus Summary under the caption “The Fund’s Investment Strategies”.

11.
Please revise to disclose the CME dynamic price fluctuation limits for Bitcoin Future Contracts, and discuss how frequently such
limits have historically been imposed. In addition, we note your disclosure on page 6 that "[i]f the CME halted trading in Bitcoin
Futures Contracts for other reasons, including if trading were halted for an entire trading day or several trading days, the Fund would
value its Bitcoin Futures Contracts by using the settlement price that the CME publishes." Please describe the price that the CME
would publish if the trading of Bitcoin Futures Contracts is halted.

RESPONSE:

The suggested revisions have been
made under the caption “Prospectus Summary – The Fund’s Investment Strategies”.

The Fund's Investments in Bitcoin

12.
Please revise to describe the "Investment Restrictions on Spot Bitcoin" and disclose your Spot Bitcoin Limits, including
quantification in dollars of those limits in recent periods in order to provide context around how those limits may impact the composition
of your assets. In addition, please revise to summarize here and describe in greater detail on page 53 the mechanics of how you purchase
and sell bitcoin and Bitcoin Futures Contracts in EFP transactions, including (i) whether you sell and purchase first to expire or second
to expire BTC Contracts and/or MBT Contracts, (ii) whether you use the CME's daily settlement prices from the prior day as the reference
price for the Bitcoin Futures Contracts sold or purchased in the EFP transactions, and, if not, how and when you calculate the reference
price of the Bitcoin Futures Contracts, (iii) how and when you calculate the reference price of the bitcoin sold or purchased in the EFP
transactions, (iv) whether you use the Direct Request for Quote available in the CME Direct, (v) the mechanics of how the bitcoin is transferred
in connection with the EFP transactions and (vi) how the CME ensures that the EFP transactions are executed at "commercially reasonable
prices," including a description of what is deemed to be a commercially reasonable price. In this regard, we note your disclosure
that you use the FBSP as the reference price for the bitcoin and the settlement price as the reference for the Futures Contracts and that
all purchases or sales of bitcoin are settled on-chain.

RESPONSE:

The Sponsor has determined that
the Fund’s previously stated portfolio investment restrictions on bitcoin holdings are commercially unwarranted. Consequently, all
prior discussions about such Sponsor-imposed Investment Restrictions on Spot Bitcoin have been removed from the Prospectus.

    4

The suggested revisions concerning
EFP transactions by the Fund have been included in the Prospectus.

13.
Please describe how the Investment Restrictions on Spot Bitcoin mitigate the risk of manipulation of the Shares of the Fund and
the bitcoin spot market, and clarify how a change of the SEC's view of the CME Bitcoin Futures market as a regulated market of significant
size, the NAV of the Fund and the prevailing trading conditions on the Core Exchanges of the Benchmark impact the Investment Restrictions
on Spot Bitcoin.

RESPONSE:

The requested disclosure is no
longer applicable because all descriptions of the Investment Restrictions on Spot Bitcoin have been removed from the Prospectus. See response
to Comment No. 12.

14.
We note your reference here to executing bitcoin transactions in a "regulated environment." Please revise to clarify,
if true, that these transactions do not take place on a regulated exchange, and balance your disclosure by describing the relevant risks
involved.

RESPONSE:

The phrase “regulated environment”
has been omitted in lieu of a more complete description of how the Fund uses the RFQ and EFP processes and associated risks.

The Offering, page 12

15.
Your disclosure on page 13 that "[t]he Sponsor determines the value of the spot bitcoin held by the Fund based on a methodology
that is entirely derived from the settlement prices of Bitcoin Futures Contracts on the CME and that [the Sponsor] considers all available
facts and all available information on the valuation date" is inconsistent with your disclosure regarding the Benchmark methodology.
Please revise for clarity here so that investors understand how the spot bitcoin holdings and Bitcoin Futures Holdings of the Fund are
calculated for the purpose of determining the NAV and the NAV per Share of the Fund in connection with creations and redemptions.

RESPONSE:

The Prospectus Summary now contains
a summary description of how the Fund’s bitcoin and Bitcoin Futures Contracts are valued for purposes of determining Fund NAV and
NAV per Share. Please be advised that the Benchmark may only play a role in determining the NAV of the Fund when the Futures-Based Spot
Price methodology is unavailable and the Sponsor determines that the Benchmark will be used as a fair value measure of the Fund’s
bitcoin.

16.
Please revise to disclose whether any of the expenses paid by the Sponsor are capped. In addition, your disclosure on page 13
that the "[g]eneral expenses of the Trust will be allocated among the Fund and any future series of the Trust as determined by the
Sponsor in its discretion" and your disclosure on page 37 that the Sponsor has the authority to "allocate expenses to and between
the funds of the Trust" is inconsistent with your disclosure on page 12 that "[t]he Trust has been formed and will be operated
with the goal that the Fund and any other series of the Trust will be liable only for obligations of such series, and a series will not
be responsible for or affected by any liabilities or losses of or claims against any other series." Please revise for clarity and
consistency.

    5

RESPONSE:

Revised disclosure regarding the
lack of expense caps and the Sponsor’s ability to allocate Trust expenses is included in the Prospectus.

17.
Please expand your summary of the Bitcoin Custodian to disclose the proportion of private keys that will be held in hot or cold
storage, whether the assets stored by the Bitcoin Custodian will be commingled with assets of other customers and whether and to what
extent the Custodian carries insurance for any losses of the Fund's custodied bitcoin.

RESPONSE:

The suggested disclosure revisions
have been made in the Prospectus.

What are the Risk Factors Involved with an Investment
in the Fund

Risks Related to Bitcoin and the Bitcoin Network

18.
Please add risk factors addressing front-running and wash trading in the spot bitcoin markets.

RESPONSE:

The suggested risk disclosures have
been added in the Prospectus as suggested.

"Forks" in the Bitcoin Network could
have adverse effects

19.
Please revise to disclose the Fund's policies related to forks and air drops, the terms of the Bitcoin Custodian's agreement that
address forks and airdrops and whether the Sponsor has provided any instructions to the Bitcoin Custodian regarding forks and air drops.

RESPONSE:

The suggested disclosure revisions
have been made in the Prospectus.

Rewards for mining bitcoin are designed to decline
over time

20.
Please expand this risk factor to describe the halving of bitcoin mining rewards, including the timing of the halving events and
quantitative information related to the historical, current and future size of the bitcoin mining rewards.

RESPONSE:

The suggested disclosure revisions
have been made in the Prospectus.

    6

Environmental risks from Bitcoin mining

21.
 Please expand this risk factor to address the reasons why bitcoin mining may implicate different risks than other crypto asset
mining such as the differences in proof-of-work and proof-of-stake, and discuss the regulations that U