XLM (commonly called “Lumens”) is a digital asset that is created and transmitted through the operations of the Stellar Network, an open-source, decentralized ledger designed to facilitate fast, low-cost cross-border payments and the tokenization of real-world assets.

The Fund is an exchange-traded fund (“ETF”) that seeks to achieve its investment objective primarily though managed exposure to XLM futures contracts that trade only on an exchange registered with the CFTC (“XLM Futures Contracts”), and cash, cash-like instruments or high quality securities that serve as collateral to the Fund’s investments in XLM Futures Contracts (“Collateral Investments”). In this manner, the Fund seeks to provide investment results that correspond to twice the performance of the price of XLM for a single day.

The Fund does not invest directly in XLM. Instead, the Fund seeks to benefit from increases in the price of XLM Futures Contracts. Under normal circumstances, the Fund will invest at least 80% of the value of its net assets (plus borrowings for investment purposes) in XLM-Linked Instruments. For purposes of this policy, “XLM-Linked Instruments” means (i) XLM Futures Contracts; (ii) shares of other XLM-linked exchange-traded investment products not registered under as investment companies (“XLM-Linked ETPs”) under the Investment Company Act of 1940, as amended (the “1940 Act”); (iii) shares of other investment companies registered under the 1940 Act that invest in similar assets to those in which the Fund may invest (“Other Investment Companies”); (iv) exchange traded options on shares of Other Investment Companies or shares of XLM-Linked ETPs; and (v) swap agreement transactions that reference XLM, XLM Futures Contracts, XLM-Linked ETPs, Other Investment Companies, or XLM-referenced indexes. Certain XLM-Linked Instruments, such as XLM-Linked ETPs or options thereon, are currently unavailable for investment, though are expected to become available in the future.

For the purpose of the Fund’s investment objective, under normal circumstances, the Fund will use the price of XLM that is reflected in the next, or second to next, expiring XLM Futures Contract. If the Fund invests in other XLM-Linked Instruments, the value of XLM will be determined by an average of how XLM is valued in the financial instruments in which the Fund invests.

The investment adviser to the Fund and the Subsidiary is Volatility Shares LLC (the “Adviser”). The Adviser oversees the Fund and implements the day-to-day portfolio management responsibilities for the Fund. In serving as investment adviser to the Fund, the Adviser does not conduct conventional investment research or analysis or forecast market movement or trends.

The Fund is classified as a “non-diversified company” under the 1940 Act. The Fund will not concentrate its investments in securities of issuers in any industry or group of industries, as the term “concentrate” is used in the 1940 Act, except that the Fund may invest more than 25% of its total assets in investments that provide exposure to XLM and/or XLM Futures Contracts.

XLM Futures Contracts

In order to obtain 2x daily exposure to XLM, the Fund intends to typically enter into cash-settled XLM Futures Contracts as the “buyer,” except as detailed below. In simplest terms, in a cash-settled futures market the counterparty pays cash to the buyer if the price of a futures contract goes up, and buyer pays cash to the counterparty if the price of the futures contract goes down. In order to maintain its 2x daily exposure to XLM, the Fund intends to exit its futures contracts as they near expiration and replace them with new futures contracts with a later expiration date. Futures contracts with a longer term to expiration may be priced higher than futures contracts

with a shorter term to expiration, a relationship called “contango”. When rolling futures contracts that are in contango the Fund will close its long position by selling the shorter term contract at a relatively lower price and buying a longer-dated contract at a relatively higher price. The presence of contango will adversely affect the performance of the Fund. Conversely, futures contracts with a longer term to expiration may be priced lower than futures contracts with a shorter term to expiration, a relationship called “backwardation”. When rolling long futures contracts that are in backwardation, the Fund will close its long position by selling the shorter term contract at a relatively higher price and buying a longer-dated contract at a relatively lower price. The presence of backwardation may positively affect the performance of the Fund. Further, the returns of the Fund’s XLM Futures Contracts may differ from that of XLM due to the divergence in prices or the costs associated with investing in futures contracts, which may negatively impact the Fund’s returns.

The Fund invests in XLM Futures Contracts indirectly via the Subsidiary. The Subsidiary and the Fund will have the same investment adviser and investment objective. The Subsidiary will also follow the same general investment policies and restrictions as the Fund. Except as noted herein, for purposes of this Prospectus, references to the Fund’s investment strategies and risks include those of the Subsidiary. The Fund complies with the provisions of the 1940 Act governing investment policies and capital structure and leverage on an aggregate basis with the Subsidiary. Furthermore, the Adviser, as the investment adviser to the Subsidiary, complies with the provisions of the 1940 Act relating to investment advisory contracts as it relates to its advisory agreement with the Subsidiary. The Subsidiary also complies with the provisions of the 1940 Act relating to affiliated transactions and custody. Because the Fund intends to qualify for treatment as a RIC under the Code, the size of the Fund’s investment in the Subsidiary will not exceed 25% of the Fund’s total assets at or around each quarter end of the Fund’s fiscal year. At other times of the year, the Fund’s investments in the Subsidiary will significantly exceed 25% of the Fund’s total assets. The Subsidiary’s custodian is U.S. Bank, N.A..

If circumstances occur where market prices for XLM Futures Contracts were not readily available, the Fund would fair value its XLM Futures Contracts in accordance with its pricing and valuation policy and procedures for fair value determinations. Pursuant to those policies and procedures, the Adviser would consider various factors, such as pricing history; market levels prior to price limits or halts; supply, demand, and open interest in XLM Futures Contracts; and comparison to other major digital asset futures, such as bitcoin, ether and XLM prices in the spot market. The Adviser would document its proposed pricing and methodology, detailing the factors that entered into the valuation.

The Stellar Network and XLM

XLM (commonly called “Lumens”) is a digital asset that is created and transmitted through the operations of the Stellar Network, an open-source, decentralized ledger designed to facilitate fast, low-cost cross-border payments and the tokenization of real-world assets. No single entity owns or operates the Stellar Network, the infrastructure of which is collectively maintained by a decentralized network of independent validator nodes. The Stellar Network allows users and institutions to send, receive, and trade digital representations of currencies, securities, and other assets across borders with minimal friction. XLM can be used to pay for goods and services, facilitate currency conversions as a bridge asset between trading pairs, or it can be converted to fiat currencies, such as the U.S. dollar, at rates determined on digital asset exchanges or in individual end-user-to-end-user transactions under a barter system.

The Stellar Network uses the Stellar Consensus Protocol (“SCP”), a unique consensus mechanism based on federated Byzantine agreement. Unlike Proof-of-Work or Proof-of-Stake systems, SCP allows nodes to reach agreement quickly and efficiently without mining or staking. Validators form quorum slices based on trust relationships, enabling decentralized yet fast consensus with low energy usage.

The Stellar Protocol was first conceived by Jed McCaleb and Joyce Kim in 2014. Development of the Stellar Network is supported by the Stellar Development Foundation, a nonprofit organization that administered the original network launch and token distribution and continues to fund ecosystem development.

Although the Stellar Development Foundation continues to exert influence over the direction of the development of XLM and the Stellar Network, the network operates in a decentralized manner and does not require governmental authorities or financial institution intermediaries to create, transmit, or determine the value of XLM.

The price of XLM has historically shown a correlation with the growth and adoption of cross-border payments, remittance solutions, and asset tokenization use cases. Stellar’s infrastructure is integrated into payment corridors, stablecoin issuance platforms, and enterprise settlement systems. Increases in cross-border payment volumes and institutional adoption have generally corresponded with increased demand for Stellar’s network, as XLM is required for transaction fees and often used as a bridge currency. It is important to note that while payments adoption appears to have had a significant impact on the value of XLM, other factors also influence XLM’s price, such as overall market conditions, technological developments, competitive payment solutions, and regulatory changes. As well, the long-term sustainability of this relationship between payments growth and XLM’s price remains uncertain.

As of March 2026, approximately 33billion XLM tokens are in circulation, out of a total supply of approximately 50billion XLM. In November 2019, the Stellar Development Foundation burned approximately 55billion XLM, reducing the original supply of 100billion lumens to its current level. Additionally, a community vote in 2019 eliminated the protocol’s original 1% annual inflation mechanism, meaning no new XLM tokens will be created. Unreleased tokens held by the Stellar Development Foundation may continue to enter circulation over time as they are distributed to fund network development and ecosystem growth.

Collateral Investments

The Fund will invest assets in Collateral Investments. The Collateral Investments may consist of high-quality securities, which include: (1) U.S. Government securities, such as bills, notes and bonds issued by the U.S. Treasury; (2) investment companies registered under the 1940 Act that invest in high-quality securities; and/or (3) corporate debt securities, such as commercial paper and other short-term unsecured promissory notes issued by businesses that are rated investment grade or determined by the Adviser to be of comparable quality. For these purposes, “investment grade” is defined as investments with a rating at the time of purchase in one of the four highest categories of at least one nationally recognized statistical rating organizations (e.g., BBB- or higher from S&P Global Ratings or Baa3 or higher from Moody’s Investors Service, Inc.).

The Collateral Investments are designed to provide liquidity, serve as margin, or otherwise collateralize the Subsidiary’s investments in XLM-Linked Instruments. The Fund expects that it will primarily invest its assets, and that the Subsidiary will primarily invest its assets, in Collateral Investments that are “securities,” as such term is defined under the 1940 Act.

Other Investments

In order to help the Fund meet its daily investment objective by maintaining the daily desired level of leveraged exposure to XLM, maintain its tax status as a regulated investment company on days in and around quarter-end, help the Fund maintain its desired exposure to XLM Futures Contracts when it is approaching or has exceeded position limits or accountability levels, or because of liquidity or other constraints, the Fund may invest in the following:

Reverse Repurchase Agreements

The Fund may invest in reverse repurchase agreements which are a form of borrowing in which the Fund sells portfolio securities to financial institutions and agrees to repurchase them at a mutually agreed-upon date and price that is higher than the original sale price, and use the proceeds for investment purchases.

As a result of the Fund repurchasing the securities at a higher price, the Fund will lose money by engaging in reverse repurchase agreement transactions.

As noted above, because the Fund intends to qualify for treatment as a RIC under the Code, the size of the Fund’s investment in the Subsidiary will not exceed 25% of the Fund’s total assets at or around each quarter end of the Fund’s fiscal year (the “Asset Diversification Test”). At other times of the year, the Fund’s investments in the Subsidiary will significantly exceed 25% of the Fund’s total (or gross) assets.

When the Fund seeks to reduce its total assets exposure to the Subsidiary, it may use the short-term Treasury Bills it owns (and purchase additional Treasury Bills as needed) to transact in reverse repurchase agreement transactions, which are ostensibly loans to the Fund. Those loans will increase the gross assets of the Fund, which the Adviser expects will allow the Fund to meet the Asset Diversification Test. When the Fund enters into a reverse repurchase agreement, it will either (i) be consistent with Section 18 of the 1940 Act and maintain asset coverage of at least 300% of the value of the reverse repurchase agreement; or (ii) treat the reverse repurchase agreement transactions as derivative transactions for purposes of Rule 18f-4 under the 1940 Act (“Rule 18f-4”), including as applicable, the value-at-risk based limit on leverage risk.

XLM-Linked ETPs

The Fund may invest in shares of XLM-Linked ETPs, which are exchange-traded investment products that are not registered under the 1940 Act that derive their value from a basket of spot XLM, and trade intra-day on a national securities exchange. XLM-Linked ETPs are passively managed and do not pursue active management investment strategies, and their sponsors do not actively manage the XLM held by the ETP. This means that the sponsor of the ETP does not sell XLM at times when its price is high or acquire XLM at low prices in the expectation of future price increases. Although the shares of an XLM-Linked ETP are not the exact equivalent of a direct investment in XLM, they provide investors with an alternative that constitutes a relatively cost-effective way to obtain exposure to XLM through the securities market.

XLM-Linked ETPs, though currently unavailable for investment, are expected to become available in the future. XLM-Linked ETPs have not yet been approved by the SEC; accordingly, such ETPs must file a registration statement on Form S-1 and subsequently be declared effective before the XLM-Linked ETPs may become available for investment. Furthermore, the SEC’s Division of Trading and Markets may be required to approve a rule change filed on behalf of securities exchange pursuant to Form 19b-4 permitting the exchange to list and trade shares of the XLM-Linked ETPs before such ETPs become available for investment.

Other Investment Companies

The Fund may invest in shares of Other Investment Companies, that is, shares of investment companies registered under the 1940 Act that invest in similar assets to those in which the Fund may invest.

Exchange-traded option contracts on shares of Other Investment Companies or shares of XLM-Linked ETPs.

The Fund may invest in exchange-listed option contracts on shares of Other Investment Companies or shares of XLM-Linked ETPs, each of which invest in similar assets to those in which the Fund may invest. An option is a contract that gives the purchaser of the option, in return for the premium paid, the right to buy shares of an investment company, from the writer of the option (in the case of a call option), or to sell shares of the investment company to the writer of the option (in the case of a put option) at a designated price during the term of the option. The premium paid by the buyer of an option will reflect, among other things, the relationship of the exercise price to the market price and the volatility of the shares of the investment company, the remaining term of the option, supply, demand, interest rates and/or currency exchange rates. The Fund may utilize “American” style options or “European” style options. American style options are exercisable on any date prior to the expiration date of the option contract. In contrast, European style options are exercisable only on the expiration date of the option contract.

Swaps that reference XLM, XLM Futures Contracts, XLM-Linked ETPs, or Other Investment Companies.

Swap contracts are transactions entered into primarily with major global financial institutions for a specified period ranging from a day to more than one year. In a swap transaction, the Fund and a counterparty will agree to exchange or “swap” payments based on the change in value of an underlying asset or benchmark. For example, the two parties may agree to exchange the return (or differentials in rates of returns) earned or realized on a particular investment or instrument. In the case of the Fund, the reference asset can be XLM, shares of XLM-Linked ETPs, XLM Futures Contracts, or XLM-referenced indexes.