Axonic Alternative Income Fund
(exact name of registrant as specified in charter)

520 Madison Avenue, 42^nd Floor
New York, NY 10022
(Address of principal executive offices) (Zip code)

Clayton DeGiacinto, President
c/o Axonic Capital LLC
520 Madison Avenue, 42^nd Floor
New York, NY 10022
(Name and Address of Agent for Service)

Jeffrey Skinner
Kilpatrick Townsend & Stockton LLP
1001 West Fourth Street
Winston-Salem, NC 27101

Electronic Report Disclosure Beginning on November 1, 2021, as permitted by regulations adopted by the U.S. Securities and Exchange Commission, paper copies of the Fund’s annual and semi-annual shareholder reports will no longer be sent by mail, unless you specifically request paper copies of the reports from the Fund or from your financial intermediary, such as a broker-dealer or bank. Instead, the reports will be made available on the Fund’s website www.axonicfunds.com, and you will be notified by mail each time a report is posted and provided with a website link to access the report.

If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. You may elect to receive shareholder reports and other communications from the Fund electronically by calling the Fund at (833) 429-6642, or submit a signed letter of instruction requesting paperless reports to PO Box 219445, Kansas City, MO 64121. If you own these shares through a financial intermediary, you may contact your financial intermediary to request your shareholder reports electronically.

You may elect to receive all future reports in paper free of charge. You can inform the Fund that you wish to continue receiving paper copies of your shareholder reports by calling the Fund at (833) 429-6642, or by submitting a signed letter of instruction requesting paper reports to PO Box 219445, Kansas City, MO 64121. If you own these shares through a financial intermediary, contact the financial intermediary to request paper copies. Your election to receive reports in paper will apply to all funds held with the fund complex or your financial intermediary.

The performance data quoted above represents past performance. Past performance is not a guarantee of future results. Investment return and value of the Fund shares will fluctuate so that an investor’s shares, when repurchased, may be worth more or less than their original cost. Performance may be lower or higher than performance data quoted. Fund performance current to the most recent month-end is available by calling (833) 429-6642 or by visiting www.axonicfunds.com.

Excludes adjustments in accordance with accounting principles generally accepted in the United States of America and as such, the net asset value and total return for shareholder transactions reported to the market may differ from the net asset value for financial reporting purposes.

Performance data quoted represents past performance, which is not a guarantee of future results. Current performance may be lower or higher than the performance quoted. The principal value and investment return of an investment will fluctuate so that your shares, if repurchased, may be worth more or less than their original cost. Total return measures net investment income and capital gain or loss from portfolio investments. All performance shown assumes reinvestment of dividends and capital gains distributions. For the most current month-end performance please call 1-833-429-6642 (833-4Axonic) or download one at www.axonicfunds.com.

The Axonic Alternative Income Fund (the “Fund”) is a continuously offered, non-diversified, closed-end management investment company that is operated as an interval fund. The Fund is suitable only for investors who can bear the risks associated with the Fund’s limited liquidity and should be viewed as a long-term investment. The Fund’s shares have no history of public trading, nor is it intended that our shares will be listed on a national securities exchange at this time, if ever. Investing in the Fund’s shares may be speculative and involves a high degree of risk, including the risks associated with leverage. Investing in the Fund involves risk, including the risk that shareholders may receive little or no return on their investment or that shareholders may lose part or all of their investment.

The graph shown above represents historical performance of a hypothetical investment of $10,000 in the Fund since inception. Past performance does not guarantee future results. All returns reflect reinvested dividends, but do not reflect the deduction of taxes that a shareholder would pay on Fund distributions or the repurchase of Fund shares.

All agreements can be terminated by either party on demand at value plus accrued interest.

Axonic Alternative Income Fund (the “Fund”) is registered under the Investment Company Act of 1940, as amended (“1940 Act”), as a non-diversified, closed-end management investment company. The Fund was organized as a Delaware statutory trust on September 26, 2018 pursuant to a Declaration of Trust governed by the laws of the State of Delaware. The Fund engages in a continuous offering of shares and operates as an interval fund and makes quarterly offers to repurchase its shares at their net asset value (the “NAV”) in accordance with Rule 23c-3 under the 1940 Act. Axonic Capital LLC (the “Adviser”) acts as the Fund’s investment adviser. The Adviser is a registered investment adviser and is responsible for making the investment decisions for the Fund’s portfolio. The Fund’s investment objective is to seek total return. The Fund’s portfolio will be deemed to be non-diversified under the 1940 Act, meaning it may invest a greater percentage of its assets in a single or limited number of issuers than a diversified fund. Under normal circumstances, the Fund will concentrate its investments (i.e., invest 25% or more of its total assets (measured at the time of purchase)) in mortgage-related assets issued by government agencies or other governmental entities or by private originators or issuers.

The Fund currently offers a single class of common shares of beneficial interest (“Shares”), which commenced operations on December 31, 2018. Shares are offered at NAV per share and are not subject to sales charges, though the Fund may, in the future, impose sales charges. The Fund may offer additional classes of shares in the future. The Fund has received exemptive relief from the Securities and Exchange Commission (“SEC”) that permits the Fund to issue multiple classes of shares. However, until the Fund registers a new share class, the Fund will only offer one class of shares.

The following is a summary of significant accounting policies followed by the Fund in preparation of its financial statements. These policies are in conformity with accounting principles generally accepted in the United States of America (“GAAP”). The Fund is considered an investment company for financial reporting purposes under GAAP. The Fund follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification (“ASC”) Topic 946 “Financial Services – Investment Companies”. The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses for the period. Actual results could differ from those estimates.

Securities Valuation – The Fund’s Board of Trustees (the “Board”) has approved pricing policies and procedures and fair valuation policies and procedures pursuant to which the Fund will value its investments. The Adviser has appointed an independent Administrator of the Fund, pursuant to the administration agreement, under which the Administrator independently calculates the daily Net Asset Value per share (“NAV”) of the Fund. In doing so, the Administrator, on a daily basis, in compliance with the policies and procedures described above, independently values the investment positions within the Fund’s portfolio. The Administrator, at its discretion, may notify the Fund or the Board of any valuation conflicts and/or non-compliance with the policies and procedures. The Administrator and the Adviser include in quarterly written reports to the Board, confirmation that the policies and procedures provide fair and accurate prices. Securities listed on an exchange, including common stocks, are valued at the last reported sale price at the close of the regular trading session of the exchange on the business day the value is being determined. Investments in shares of funds, including money market funds, that are not traded on an exchange, are valued at the end of day net asset value (“NAV”) per share of such fund.

Structured credit and other similar debt securities including, but not limited to, asset-backed securities, collateralized debt obligations, collateralized loan obligations, collateralized mortgage obligations, mortgage-backed securities, commercial mortgage-backed security, and other securitized investments backed by certain debt or other receivables (collectively, “Structured Credit Securities”), are valued on the basis of valuations provided by independent pricing services and /or dealers in those instruments recommended by the Adviser and approved by the Board. In determining fair value, pricing services and dealers will generally use information with respect to transactions in the securities being valued, quotations from other dealers, market transactions in comparable securities, analyses and evaluations of various relationships between securities, and yield to maturity information. The Adviser will, based on its reasonable judgment, select the pricing services or dealer quotations that most accurately reflect the fair market value of the Structured Credit Security while taking into account the information utilized by the pricing services or dealers to formulate the quotation in addition to any other relevant factors.

When price quotations for certain securities are not readily available, or if the available quotations are not believed to be reflective of market value by the Adviser, those securities will be valued at “fair value” as determined in good faith by the Adviser’s Valuation Committee using the fair valuation policies and procedures adopted by, and under the supervision of, the Board. There can be no assurance that the Fund could purchase or sell a portfolio security at the price used to calculate the Fund’s NAV.

The fair valuation policies and procedures may be used to value a substantial portion of the assets of the Fund. The Fund may use the fair value of a security to calculate its NAV when, for example, (1) a portfolio security is not traded in a public market or the principal market in which the security trades is closed, (2) trading in a portfolio security is suspended and has not resumed prior to the normal market close, (3) a portfolio security is not traded in significant volume for a substantial period, or (4) the Adviser determines that the quotation or price for a portfolio security provided by an independent pricing service and broker-dealer is inaccurate.

The “fair value” of securities may be difficult to determine and thus judgment plays a greater role in the valuation process. The fair valuation methodology may include or consider the following guidelines, as appropriate: (1) evaluation of all relevant factors, including but not limited to, pricing history, current market level and supply and demand of the respective security; (2) comparison to the values and current pricing of securities that have comparable characteristics; (3) knowledge of historical market information with respect to the security; and (4) other factors relevant to the security which would include, but not be limited to, duration, yield, fundamental analytical data, the Treasury yield curve and credit quality.

Fair Value Measurements – A three-tier hierarchy has been established to classify fair value measurements for disclosure purposes. Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including assumptions about risk. Inputs may be observable or unobservable. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability that are developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs are inputs that reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability that are developed based on the best information available. In accordance with the authoritative guidance on fair value measurements and disclosure under GAAP, the Fund discloses the fair value of its investments in a hierarchy that prioritizes the inputs to valuation techniques used to measure the fair value.

Various inputs are used in determining the value of the Fund’s investments as of the reporting period end. These inputs are categorized in the following hierarchy under applicable financial accounting standards:

The availability of observable inputs can vary from security to security and is affected by a wide variety of factors, including, for example, the type of security, whether the security is new and not yet established in the marketplace, the liquidity of markets and other characteristics particular to the security. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised in determining fair value is greatest for instruments categorized in Level 3.

An investment level within the fair value hierarchy is based on the lowest level input, individually or in the aggregate, that is significant to fair value measurement. To the extent practicable, the Adviser generally endeavors to maximize the use of observable inputs and minimize the use of unobservable inputs by requiring that the most observable inputs are to be used when available.

Axonic Alternative Income Fund	Notes to Financial Statements
	April 30, 2021 (Unaudited)

The inputs or methodologies used for valuing securities are not necessarily an indication of the risk or liquidity associated with investing in those securities. The following is a summary of the inputs used in valuing the Fund’s investments as of April 30, 2021:

Investments in Securities at Value^(a)(b)	Level 1 - Quoted Prices		Level 2 - Other Significant Observable Inputs		Level 3 - Significant Unobservable Inputs		Total
Asset-Backed Securities	$	–	$	1,503,023	$	–	$	1,503,023
Commercial Mortgage-Backed Securities		–		11,488,524		–		11,488,524
Convertible Corporate Bond		–		1,960,000		–		1,960,000
Corporate Bonds		–		501,036		–		501,036
Residential Mortgage-Backed Securities		–		2,760,813		–		2,760,813
Short Term Investments		4,355,295		–		–		4,355,295
Total	$	4,355,295	$	18,213,396	$	–	$	22,568,691

^(a)	For detailed descriptions of industries, see the accompanying Schedule of Investments.
^(b)	For liabilities arising from reverse repurchase agreements, the carrying amount approximates fair value due to the relatively short-term maturity of these financial instruments.

Securities Transactions and Investment Income – Investment security transactions are accounted for on a trade date basis. Cost is determined and gains and losses are based upon the specific identification method for both financial statement and federal income tax purposes. Dividend income is recorded on the ex-dividend date and interest income is recorded on the accrual basis. Dividend income from REITs is recognized on the ex-dividend date. It is common for distributions from REITs to exceed taxable earnings and profits, resulting in the excess portion of such dividends being designated as a return of capital. The calendar year-end amounts of ordinary income, capital gains, and return of capital included in distributions received from the Fund’s investment in REITs are reported to the Fund after the end of the calendar year; accordingly, the Fund estimates these amounts for accounting purposes until the characterization of REIT distributions is reported to the Fund after the end of the calendar year. Estimates are based on the most recent REIT distribution information available.

Premium and Discount Amortization/Paydown Gains and Losses – All premiums and discounts on fixed-income securities are amortized/accreted over the estimated lives of such securities for financial statement purposes using the effective interest method. Gains and losses realized on principal payments of mortgage-backed securities (paydown gains and losses) are classified as part of interest income.

Concentration of Credit Risk – The Fund places its cash with one banking institution, which is insured by Federal Deposit Insurance Corporation (“FDIC”). The FDIC limit is $250,000. At various times throughout the year, the amount on deposit may exceed the FDIC limit and subject the Fund to a credit risk. The Fund does not believe that such deposits are subject to any unusual risk associated with investment activities.

Federal and Other Taxes – No provision for income taxes is included in the accompanying financial statements, as the Fund intends to distribute to shareholders all taxable investment income and realized gains and otherwise comply with Subchapter M of the Internal Revenue Code of 1986, as amended, applicable to regulated investment companies.

The Fund evaluates tax positions taken (or expected to be taken) in the course of preparing the Fund’s tax provisions to determine whether these positions meet a “more-likely-than-not” standard that, based on the technical merits, have a more than fifty percent likelihood of being sustained by a taxing authority upon examination. A tax position that meets the “more-likely-than-not” recognition threshold is measured to determine the amount of benefit to recognize in the financial statements.

As of and during the period ended April 30, 2021, the Fund did not have a liability for any unrecognized tax benefits. The Fund files U.S. federal, state and local tax returns as required. The Fund’s tax returns are subject to examination by the relevant tax authorities until expiration of the applicable statute of limitations which is generally three years after the filing of the tax return for federal purposes and four years for most state returns. Tax returns for all tax years since inception have incorporated no uncertain tax positions that require a provision for income taxes.

Distributions to Shareholders – Distributions from the Fund’s net investment income were accrued daily and paid quarterly through February 28, 2021. Effective March 1, 2021, distributions are accrued daily and paid monthly. However, there can be no assurances that the Fund will achieve any level of distribution to its Shareholders. The Fund intends to make sufficient distributions of its ordinary taxable income and capital gain net income prior to the end of each calendar year to avoid liability for the excise tax. The character of income and gains to be distributed is determined in accordance with income tax regulations, which may differ from GAAP.

Semi-Annual Report | April 30, 2021

Indemnification – The Fund indemnifies its officers and trustees for certain liabilities that may arise from the performance of their duties to the Fund. Additionally, in the normal course of business, the Fund enters into contracts that contain a variety of representations and warranties which provide general indemnities. The Fund’s maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Fund that have not yet occurred. However, the Fund expects the risk of loss due to these warranties and indemnities to be remote.

The Fund may engage in reverse repurchase agreements. Reverse repurchase agreements are agreements that involve the sale of securities held by the Fund to financial institutions such as banks and broker-dealers, with an agreement that the Fund will repurchase the securities at an agreed upon price and date. During the reverse repurchase agreement period, the Fund continues to receive interest and principal payments on the securities sold. The Fund may employ reverse repurchase agreements (i) for temporary emergency purposes or to meet repurchase requests so as to avoid liquidating other portfolio securities during unfavorable market conditions; (ii) to cover short-term cash requirements resulting from the timing of trade settlements; or (iii) to take advantage of market situations where the interest income to be earned from the investment of the proceeds of the transaction is greater than the interest expense of the transaction.

Reverse repurchase agreements involve the risk that the market value of securities to be purchased by the Fund may decline below the price at which the Fund is obligated to repurchase the securities, or that the other party may default on its obligation, so that the Fund is delayed or prevented from completing the transaction. At the time the Fund enters into a reverse repurchase agreement, it will segregate, and maintain, liquid assets having a dollar value equal to the repurchase price. In the event the buyer of securities under a reverse repurchase agreement files for bankruptcy or becomes insolvent, the Fund’s use of the proceeds from the sale of the securities may be restricted pending a determination by the other party, or its trustee or receiver, whether to enforce the Fund’s obligations to repurchase the securities. Reverse repurchase agreements are considered borrowings by the Fund under the 1940 Act.

Cash received in exchange for securities delivered plus accrued interest payments to be made by the Fund to counterparties are reflected as a liability on the Statement of Assets and Liabilities. Interest payments made by the Fund to counterparties are recorded as a component of interest expense on the Statement of Operations. In periods of increased demand for the security, the Fund may receive a fee for use of the security by the counterparty, which may result in interest income to the Fund. The Fund will segregate assets determined to be liquid to cover its obligations under reverse repurchase agreements. The segregated assets are found on the Fund’s Statement of Investments as full or partially pledged securities. The total amount of securities pledged at April 30, 2021 was $4,559,882. As all agreements can be terminated by either party on demand, face value approximates fair value at April 30, 2021. This fair value is based on Level 2 inputs under the three-tier fair valuation hierarchy described above. For the period ended April 30, 2021 the average amount of reverse repurchase agreements outstanding was $3,189,000, at a weighted average interest rate of 1.85%.

The following table indicates the total amount of reverse repurchase agreements, reconciled to gross liability as of April 30, 2021:

Offsetting Arrangements: Reverse repurchase agreements are executed under standardized netting agreements. A netting arrangement creates an enforceable right of set-off that becomes effective, and affects the realization of settlement on individual assets, liabilities and collateral amounts, only following a specified event of default or early termination. Default events may include the failure to make payments or deliver securities timely, material adverse changes in financial condition or insolvency, the breach of minimum regulatory capital requirements, or loss of license, charter or other legal authorization necessary to perform under the contract. These agreements mitigate counterparty credit risk by providing for a single net settlement with a counterparty of all financial transactions covered by the agreement in an event of default as defined under such agreement.

Advisory Fees – Pursuant to the investment advisory agreement by and between the Fund and the Adviser (the “Investment Advisory Agreement”), and in consideration of the advisory services provided by the Adviser to the Fund, the Adviser is entitled to a management fee equal to 1.25% of the Fund’s average daily net assets. For the period ended April 30, 2021, the Fund incurred $94,886 in Advisory Fees.

The Adviser has contractually agreed to waive its fees and/or reimburse certain expenses (inclusive of organizational and offering costs, but exclusive of any taxes, interest on borrowings, dividends on securities sold short, brokerage commissions, 12b-1 fees, acquired fund fees and expenses, expenses incurred in connection with any merger or reorganization and extraordinary expenses) to limit the Fund’s expenses after Fee Waiver/Expense Reimbursement to 2.00% of the Fund’s average daily net assets (the “Expense Limit”) through February 28, 2022. The Expense Limit excludes certain expenses and, consequently, the Fund’s expenses after Fee Waiver/Expense Reimbursement may be higher than the Expense Limit. The contractual waiver and expense reimbursement may be changed or eliminated at any time by the Board of Trustees, on behalf of the Fund, upon 60 days’ written notice to the Adviser. The contractual fee waiver and expense reimbursement may not be terminated by the Adviser without the consent of the Board. The Adviser may recoup from the Fund any waived amount or reimbursed expenses pursuant to this agreement if such recoupment does not cause the Fund to exceed the current Expense Limit or the Expense Limit in place at the time of the waiver or reimbursement (whichever is lower) and the recoupment is made within three years after the end of the month in which the Adviser incurred the expense. During the period ended April 30, 2021, the Adviser reimbursed expenses of $77,036 and the Fund repayed the Adviser previously waived fees and expenses of $32,817.

As of April 30, 2021, the following amounts were available for recoupment by the Adviser based upon their potential expiration dates:

Chief Compliance Officer ("CCO")/Compliance Services –The CCO is an affiliate of the Fund. For the period ended April 30, 2021, the total related amounts paid by the Fund for CCO fees are reflected in Chief Compliance Officer fees on the Fund’s Statement of Operations.

Fund Accounting and Administration Fees and Expenses – ALPS Fund Services, Inc. (“ALPS”) serves as the Fund’s administrator and accounting agent (the “Administrator”) and receives customary fees from the Fund for such services.

Axonic Alternative Income Fund	Notes to Financial Statements
	April 30, 2021 (Unaudited)

Transfer Agent – DST Systems Inc., an affiliate of ALPS, serves as transfer, dividend paying and shareholder servicing agent for the Fund (“Transfer Agent”).

Distributor – The Fund has entered into a distribution agreement with ALPS Distributors, Inc. (the “Distributor”) to provide distribution services to the Fund. There are no fees paid to the Distributor pursuant to the distribution agreement.

The Distributor acts as the Fund’s principal underwriter in a continuous public offering of the Fund’s shares. The Distributor is an affiliate of ALPS. During the period ended April 30, 2021, no fees were retained by the Distributor.

Trustees – Officers of the Trust and the Trustees who are ‘interested persons’ of the Trust or the Adviser receive no salary from the Trust. The Independent Trustees also serve as independent trustees on the Board of Trustees of Axonic Funds, an open-end investment company for which Axonic Capital LLC also serves as the investment adviser. As of January 1, 2021 for their service on the Board and the Board of Trustees of Axonic Funds, the Independent Trustees receive the following fees, which are split between the Fund and the Axonic Funds pro rata based on assets under management: $25,000 annual retainer for each Independent Trustee, $3,000 annually for each of the Valuation Committee Chair, Audit Committee Chair and Nominating and Governance Committee Chair, $5,000 for each quarterly meeting, and $1,000 for each special meeting. Prior to January 1, 2021 the Trustees received an annual retainer of $4,000 and a fee of $2,000 for each Board meeting attended in person and $1,000 for each Board meeting attended by telephone. The Fund reimburses each Trustee and officer of the Trust for his or her travel and other expenses relating to attendance at Board or committee meetings.

5. INVESTMENT TRANSACTIONS

The cost of purchases and proceeds from the sale of securities, other than short-term securities, for the period ended April 30, 2021, amounted to $11,049,260 and $4,856,460, respectively.

6. TAX BASIS INFORMATION

Distributions are determined in accordance with federal income tax regulations, which differ from GAAP, and, therefore, may differ significantly in amount or character from net investment income and realized gains for financial reporting purposes. Financial reporting records are adjusted for permanent book/tax differences to reflect tax character but are not adjusted for temporary differences. The amounts and characteristics of tax basis distributions and composition of distributable earnings/(accumulated losses) are finalized at fiscal year-end. Accordingly, tax basis balances have not

been determined as of the date of the semi-annual report.

As of April 30, 2021, net unrealized appreciation/(depreciation) of investments based on the federal tax cost were as follows:

Cost of investments for income tax purposes	$	22,078,101
Gross appreciation (excess of value over tax cost)	$	1,055,663
Gross depreciation (excess of tax cost over value)		(565,073	)
Net unrealized appreciation	$	490,590

7. REPURCHASE OFFERS

Pursuant to Rule 23c-3 under the 1940 Act, the Fund offers shareholders on a quarterly basis the option of redeeming shares, at NAV, of no less than 5% and no more than 25% of its issued and outstanding shares as of the close of regular business hours on the New York Stock Exchange on the Repurchase Pricing Date. If shareholders tender for repurchase more than the Repurchase Offer Amount for a given repurchase offer, the Fund may, but is not required to, repurchase an additional amount of Shares not to exceed 2.00% of the outstanding shares on the Repurchase Request Deadline. If the Fund determines not to repurchase more than the Repurchase Offer Amount, or if Shareholders tender Shares in an amount exceeding the Repurchase Offer Amount plus 2.00% of the outstanding Shares on the Repurchase Request Deadline, the Fund will repurchase Shares on a pro rata basis. However, the Fund may accept all Shares tendered for repurchase by Shareholders who own less than one hundred Shares and who tender all of their Shares, before prorating other amounts tendered. There can be no assurance that the Fund will be able to repurchase all shares that each shareholder has tendered, even if all of the shares in a shareholder’s account are tendered. In the event of an oversubscribed offer, you may not be able to tender all shares that you wish to tender and you may have to wait until the next quarterly repurchase offer to tender the remaining shares, subject to any proration. Subsequent repurchase requests will not be given priority over other shareholder requests.

14	www.axonicfunds.com

Axonic Alternative Income Fund	Notes to Financial Statements
	April 30, 2021 (Unaudited)

During the period ended April 30, 2021, the Fund completed two quarterly repurchase offers. The results of the repurchase offers were as follows:

	Repurchase Offer	Repurchase Offer
Commencement Date	November 18, 2020	February 22, 2021
Repurchase Request Deadline	December 18, 2020	March 24, 2021
Repurchase Pricing Date	December 18, 2020	March 24, 2021

Net Asset Value as of Repurchase Offer Date:	$21.91	$22.31

Amount Repurchased:	$143,790	$508,762

8. SIGNIFICANT SHAREHOLDERS

The beneficial ownership, either directly or indirectly, of more than 25% of the voting securities of a Fund creates a presumption of control of the Fund under Section 2(a)(9) of the 1940 Act. As of April 30, 2021, the following entities owned beneficially more than 25% of the Fund’s outstanding shares. The shares may be held under omnibus accounts (whereby the transactions of two or more shareholders are combined and carried in the name of the originating broker rather than designated separately). Any transaction by these investors could have a material impact on the share class.

Name	Percentage
Pershing LLC	94.24%

9. SUBSEQUENT EVENTS

Subsequent events after the date of the Statement of Assets and Liabilities have been evaluated through the date the financial statements were issued.

The Fund completed a quarterly repurchase offer on June 21, 2021 which resulted in 2,479 shares being repurchased for $55,287.

Management has determined that there were no other subsequent events to report through the issuance of these financial statements.

Semi-Annual Report | April 30, 2021

A description of the policies and procedures that the Fund uses to vote proxies relating to portfolio securities is available without charge upon request by calling toll-free 888-926-2688, or on the SEC’s website at http://www.sec.gov. Information regarding how the Fund voted proxies relating to its portfolio securities during the most recent 12-month period ended June 30th is available without charge upon request by calling toll-free 833-429-6642 (833-4Axonic), or on the SEC’s website at http://www.sec.gov.

The Fund files its complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year as an exhibit to its reports on Form N-PORT; the Fund’s Form N-PORT reports are available on the Fund’s website at https://www.axonicfunds.com and the SEC’s Website at http://www.sec.gov.

Pursuant to Section 15(c) of the Investment Company Act of 1940, as amended (the “1940 Act”), at a meeting held on December 10, 2020 (the “Meeting”), the Board of Trustees (the “Board”) of Axonic Alternative Income Fund (the “Fund”) considered the approval of the continuance of the Investment Advisory Agreement (the “Advisory Agreement” or the “Agreement”) between the Fund and Axonic Capital LLC (the “Adviser” or “Axonic”) for an additional one year period. The relevant provisions of the 1940 Act specifically provide that it is the duty of the Board to request and evaluate such information as the Board determines is necessary to allow it to properly consider the renewal of the Advisory Agreement, and it is the duty of the Adviser to furnish the Trustees with information that is responsive to their request.

Accordingly, in determining whether to approve the continuance of the Advisory Agreement between the Adviser and the Fund, the Board requested, and the Adviser provided, information and data relevant to the Board’s consideration. This included materials prepared by the Adviser that provided the Board with information regarding, among other things, the estimated fees and expenses of the Fund, as compared to other similar funds.

Following their review and consideration, the Board, including those Trustees who are not considered to be “interested persons” of the Fund, as that term is defined in the 1940 Act (the “Independent Trustees”), unanimously approved the continuance of the Advisory Agreement for a one year period. In reaching their decision, the Trustees requested and obtained from the Adviser such information as they deemed reasonably necessary to evaluate the Advisory Agreement. The Trustees also carefully considered the profitability data and comparative fee and expense information prepared by Fund management. The following summary does not identify all the matters considered by the Board, but provides a summary of the principal matters the Board considered.

The nature, extent and quality of the advisory services provided. The Trustees received and considered information regarding the nature, extent and quality of services provided to the Fund under the Advisory Agreement. This information included, among other things, the nature and quality of services provided to the Fund, the professional qualifications and experience of each of the portfolio managers of the Fund, Axonic’s compliance procedures and practices, its efforts to promote the Fund and assist in its distribution, and Axonic’s investment and management oversight processes. After reviewing the foregoing information and further information in the Adviser’s memorandum (e.g., description of its business and Form ADV), the Board concluded that the quality, extent, and nature of the services provided by the Adviser to the Fund were satisfactory and adequate.

The past performance of the Fund. In this regard, the Board compared the performance of the Fund with the performance of its benchmark index and custom peer group. The Board noted that the Fund had underperformed relative to its custom peer group and benchmark for the one-year and since inception periods. The Board indicated that the Adviser had satisfactorily explained its performance results for the Fund. The Board also considered the consistency of the Adviser’s management with the Fund’s investment objective and policies. Following additional discussion of the investment performance of the Fund; the Adviser’s experience in managing registered funds, private funds, and separate accounts; the Adviser’s historical investment performance; and other factors, the Board concluded that the investment performance of the Fund has been satisfactory.

The cost of advisory services provided and the level of profitability. The Board considered Axonic’s staffing; methods of operating; the education and experience of its personnel; its compliance program, policies and procedures; its financial condition and the level of commitment to the Fund and, generally, the Adviser’s advisory business; the asset level of the Fund; the overall expenses of the Fund, including the advisory fee; and the differences in fees and services to Axonic’s other similar clients. The Board considered its discussion with the Adviser regarding the expense limitation agreement (“ELA”), and considered the Adviser’s past fee reductions and expense reimbursements for the Fund. The Board further took into account Axonic’s willingness to continue the ELA for the Fund until at least February 28, 2022.

The Board also considered potential benefits for Axonic in managing the Fund, including promotion of Axonic’s name. The Board compared the Fund’s advisory fee and overall expense ratio to the average and median advisory fees and expense ratios for its custom peer group and fees charged to Axonic’s other client accounts. In considering the comparison in fees and expense ratios between the Fund and other comparable funds, the Board looked at the differences in types of funds being compared, the style of investment management, the size of the Fund, and the nature of the investment strategies. The Board also considered Axonic’s commitment to limit the Fund’s expenses under the ELA. The Board noted that the advisory fee for the Fund was below the average for the custom peer group. The Board further noted that the overall expense ratio was lower than the average expense ratio for the custom peer group. The Board further considered the investment strategy and style used by Axonic in managing the portfolio of the Fund. Following these comparisons and considerations and upon further consideration and discussion of the foregoing, the Board concluded that the advisory fee to be paid to Axonic by the Fund is reasonable.

The extent to which economies of scale may be realized as the Fund grows and whether the advisory fee reflects possible economies of scale. While it was noted that the Fund’s investment advisory fee will not decrease as the Fund’s assets grow because it is not subject to investment advisory fee breakpoints, the Trustees concluded that the Fund’s investment advisory fee is appropriate in light of the size of the Fund and appropriately reflects the current economic environment for Axonic and the competitive nature of the closed-end interval fund market. The Trustees then noted that they will periodically reexamine whether the Fund has achieved economies of scale and the appropriateness of the investment advisory fee payable to Axonic with respect to the Fund, in the future, at which time the implementation of fee breakpoints on the Fund could be considered and that Axonic had indicated a willingness to consider the implementation of fee breakpoints in the future as economies of scale are reached.

Benefits to Axonic from its relationship with the Fund (and any corresponding benefits to the Fund). The Trustees concluded that other benefits derived by Axonic from its relationship with the Fund are reasonable and consistent with industry practice and the best interests of the Fund and its shareholders.

Other Considerations. In approving the Advisory Agreement, the Trustees determined that Axonic has made a commitment to the recruitment and retention of high quality personnel and maintains the financial, compliance and operational resources reasonably necessary to manage the Fund in a professional manner that is consistent with the best interests of the Fund and its shareholders. The Trustees also concluded that Axonic has made a significant entrepreneurial commitment to the management and success of the Fund, which entails a substantial financial and professional commitment. The Board also considered matters with respect to the brokerage practices of Axonic, including its best-execution procedures, and noted that these were reasonable and consistent with standard industry practice. The Board also considered the possibility for conflicts of interest to arise with respect to Axonic’s management of the Fund and in that respect the Board considered such matters as the experience and abilities of the advisory personnel assigned to the Fund; Axonic’s process for allocating trades among the Fund and its other clients; and the substance and administration of Axonic’s Code of Ethics. Following further consideration and discussion, the Board found for the Fund that Axonic’s standards and practices relating to the identification and mitigation of potential conflicts of interests were satisfactory.

In reaching their conclusion with respect to the approval of the Advisory Agreement and the level of fees paid under the Agreement, the Trustees did not identify any one single factor as being controlling, rather, the Trustees took note of a combination of factors that had influenced their decision making process.

The shareholders of the Fund, pursuant to a written consent to action, elected Mr. Joshua M. Barlow, Mr. Charles D. Mires and Mr. Thomas S. Vales to the Board of Trustees of the Trust effective April 15, 2020. The Board is responsible for the oversight of the management of the Fund, including general supervision and review of the service providers that perform the investment activities of the Fund. The Board, in turn, elects the officers of the Fund, who are responsible for administering the day-to-day operations of the Fund. Unless otherwise indicated in the table below, the address of each Trustee and officer of the Fund is c/o Axonic Capital LLC, 520 Madison Avenue, 42nd Floor, New York, New York 10022. Information about the Trustees and officers of the Fund is provided in the table below. Additional information about members of the Board of Trustees and Officers of the Trust is available in the Statement of Additional Information, which is available, without charge, upon request, by calling the Funds (toll-free) at 1-833-429-6642 (833-4Axonic).

Axonic Alternative Income Fund (the “Fund”) has in effect the following policy (the “Data Privacy Policy”) with respect to nonpublic personal information about its customers.

The Fund collects nonpublic personal information about its customers¹ from the following sources:

In addition, the Fund may obtain consumer information about its customers from consumer reports.

The Fund will not release nonpublic personal or consumer information about its customers or their accounts unless one of the following conditions is met:

The Fund does not give or sell nonpublic personal or consumer information about its customers or their fund accounts to any other company, individual, or group.

The Fund will only use nonpublic personal or consumer information about its customers and their accounts to attempt to better serve their investment needs or to suggest services or educational materials that may be of interest to them.

The Fund restricts access to nonpublic personal and consumer information about customers to those employees who need to know that information in order to provide products or services. The Fund may also share personal information with companies that it hires to provide support services. When the Fund or its Transfer Agent shares nonpublic personal or consumer information with other service providers, it protects that information with a strict confidentiality agreement. The Fund also maintains reasonable physical, electronic and procedural safeguards that comply with federal standards to protect against unauthorized access to and properly dispose of customers’ nonpublic personal and consumer information.

The Fund will adhere to the policies and practices described in this notice for current and former shareholders of the Fund.

The following includes a list of the primary physical, electronic and procedural safeguards employed by the Transfer Agent to ensure against unauthorized access and proper disposal of customers’ nonpublic personal and consumer information.

The Nominating and Governance Committee, comprised of all the Independent Trustees, is responsible for seeking and reviewing candidates for consideration as nominees for Trustees. The Committee has a policy in place for considering Trustee candidates recommended by shareholders. Nomination submissions must be accompanied by all information relating to the recommended nominee that is required to be disclosed in solicitations or proxy statements for the election of Trustees, as well as information sufficient to evaluate the individual’s qualifications. Nomination submissions must be accompanied by all information relating to the recommended nominee that is required to be disclosed in solicitations or proxy statements for the election of Trustees, as well as information sufficient to evaluate the individual’s qualifications. Nomination submissions should be sent to:

Secretary, Axonic Alternative Income Fund
c/o Axonic Capital LLC
520 Madison Avenue, 42nd Floor
New York, NY 10022

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

	1 Month	Quarter	6 Month	YTD	1 Year	Since Inception*
Axonic Alternative Income Fund - NAV	0.39%	0.67%	9.90%	3.74%	17.38%	0.26%
Bloomberg Barclays US Aggregate Bond Index^(a)	0.79%	-1.91%	-1.52%	-2.61%	-0.27%	5.81%

Top Ten Holdings (as a % of Net Assets)*

FRESB Mortgage Trust, Series 2020-SB81, Class B	16.90%
FREMF Mortgage Trust, Series 2020-KF86, Class C	14.57%
HSI Asset Loan Obligation Trust, Series 2007-WF1, Class A2	11.76%
Granite Point Mortgage Trust, Inc.	11.32%
FRESB Mortgage Trust, Series 2021-SB83, Class X1	10.38%
FRESB Mortgage Trust, Series 2020-SB74, Class B	8.53%
GKN Subordinated CTL Pass-Through Trust/Auburn MI	7.16%
Thunderbolt III Aircraft Lease, Ltd., Series 2019-1, Class B	4.92%
FRESB Mortgage Trust, Series 2017-SB38, Class B	4.19%
Horizon Aircraft Finance II, Ltd., Series 2019-1, Class C	3.76%
Top Ten Holdings	93.49%

Portfolio Composition (as a % of Net Assets)*

Commercial Mortgage-Backed Securities	66.34%
Residential Mortgage-Backed Securities	15.94%
Convertible Corporate Bond	11.32%
Asset-Backed Securities	8.68%
Corporate Bonds	2.89%
Cash Equivalents & Other Net Assets	-5.17%
	100.00%

	Rate		Maturity Date	Principal Amount		Value
ASSET-BACKED SECURITIES (8.68%)
Horizon Aircraft Finance II, Ltd., Series 2019-1, Class C^(a)		6.90%	07/15/26	$	860,282	$	651,070
Thunderbolt III Aircraft Lease, Ltd., Series 2019-1, Class B^(a)		4.75%	11/15/26		939,102		851,953

TOTAL ASSET-BACKED SECURITIES
(Cost $1,191,784)							1,503,023

COMMERCIAL MORTGAGE-BACKED SECURITIES (66.34%)
BMD2 Re-Remic Trust, Series 2019-FRR1, Class 7A1^(a)		2.87%	05/25/52		24,975		24,870
BMD2 Re-Remic Trust, Series 2019-FRR1, Class 7A^(a)(b)		4.16%	05/25/52		125,091		125,003
FREMF Mortgage Trust, Series 2020-KF86, Class C^(a)(b)(c)		1M US L + 9.00%	08/25/27		2,476,891		2,523,705
FRESB Mortgage Trust, Series 2017-SB38, Class B^(a)(b)		3.92%	08/25/27		842,063		725,690
FRESB Mortgage Trust, Series 2020-SB74, Class B^(a)(b)		7.50%	04/25/30		1,627,606		1,476,890
FRESB Mortgage Trust, Series 2020-SB76, Class B^(a)(b)		7.50%	05/25/30		497,786		449,103
FRESB Mortgage Trust, Series 2020-SB81, Class B^(a)(b)		7.50%	10/25/30		3,253,843		2,926,831
FRESB Mortgage Trust, Series 2021-SB83, Class X1^(b)(d)		0.98%	12/25/30		25,824,619		1,797,393
GKN Subordinated CTL Pass-Through Trust/Auburn MI^(a)(b)		0.00%	03/15/30		2,280,172		1,240,186
Wells Fargo Re-REMIC Trust, Series 2013-FRR1, Class BK26^(a)(e)		0.00%	12/27/22		209,716		198,853

TOTAL COMMERCIAL MORTGAGE-BACKED SECURITIES
(Cost $10,901,196)							11,488,524

CONVERTIBLE CORPORATE BOND (11.32%)
Granite Point Mortgage Trust, Inc.		6.38%	10/01/23		2,000,000		1,960,000

TOTAL CONVERTIBLE CORPORATE BOND
(Cost $1,960,000)							1,960,000

CORPORATE BONDS (2.89%)
Ambac LSNI LLC^(a)(b)		3M US L + 5.00%	02/12/23		498,543		501,036

TOTAL CORPORATE BONDS
(Cost $486,786)							501,036

RESIDENTIAL MORTGAGE-BACKED SECURITIES (15.94%)
Countrywide Alternative Loan Trust, Series 2006-20CB, Class A6^(b)		1M US L + 0.50%	07/25/36		101,610		38,953
Countrywide Alternative Loan Trust, Series 2006-24CB, Class A19^(b)		1M US L + 0.50%	08/25/36		82,001		43,246
Countrywide Alternative Loan Trust, Series 2006-21CB, Class A7^(b)		1M US L + 0.70%	07/25/36		90,274		49,543
Countrywide Home Loans Mortgage Pass-Through Trust, Series 2006-21, Class A6^(b)		1M US L + 0.37%	02/25/37		87,988		43,290
HSI Asset Loan Obligation Trust, Series 2007-WF1, Class A2^(b)(c)		0.21%	12/25/36		5,287,051		2,036,176
Lehman Mortgage Trust, Series 2007-5, Class 4A2^(b)		1M US L + 0.32%	08/25/36		241,673		176,282
MASTR Asset Securitization Trust, Series 2006-1, Class 2A1^(b)		1M US L + 0.45%	05/25/36		126,170		30,336
Merrill Lynch Mortgage Investors Trust, Series 2006-RM2, Class A1B^(b)		1M US L + 0.47%	05/25/37		1,429,735		75,046
Residential Accredit Loans, Inc. Trust, Series 2006-QS5, Class A7^(b)		1M US L + 0.30%	05/25/36		55,243		41,077
Residential Asset Mortgage Products, Inc. Trust, Series 2006-RS2, Class M1^(b)		1M US L + 0.59%	03/25/36		100,000		87,380
Saxon Asset Securities Trust, Series 2004-2, Class MF4^(f)		3.28%	08/25/35		147,556		139,484

TOTAL RESIDENTIAL MORTGAGE-BACKED SECURITIES
(Cost $3,183,040)							2,760,813

	7-Day Yield		Shares		Value
SHORT TERM INVESTMENTS - COMMON SHARES (25.14%)
JPMorgan US Treasury Plus Money Market Fund		0.02%		4,355,295	$	4,355,295

TOTAL SHORT TERM INVESTMENTS
(Cost $4,355,295)						4,355,295

TOTAL INVESTMENTS (130.31%)
(Cost $22,078,101)					$	22,568,691

Liabilities in Excess of Other Assets (-30.31%)						(5,250,172	)
NET ASSETS (100.00%)					$	17,318,519

Counterparty	Interest Rate		Acquisition Date	Maturity Date	Amount
Royal Bank of Canada		1.426%	04/23/2021	07/26/2021	$	1,686,000
Royal Bank of Canada		2.334%	04/27/2021	07/28/2021		1,503,000
					$	3,189,000

Portfolio Update	1
Schedule of Investments	3
Statement of Assets and Liabilities	5
Statement of Operations	6
Statements of Changes in Net Assets	7
Financial Highlights	8
Notes to Financial Statements	9
Additional Information	16
Board Consideraions Regarding Approval of Investment Advisory and Sub-Advisory Agreements	17
Trustees and Officers	19
Privacy Policy	21

ASSETS:
Investments, at fair value (Cost $22,078,101)	$	22,568,691
Interest receivable		78,646
Receivable for shares sold		56,796
Prepaid expenses and other assets		12,136
Total Assets		22,716,269

LIABILITIES:
Payable for investment securities purchased		1,971,333
Payable for reverse repurchase agreements		3,189,000
Interest payable on reverse repurchase agreements		626
Income distribution payable		111,913
Accrued legal and audit fees payable		67,364
Due to Adviser		16,610
Accrued fund accounting and administration fees payable		10,070
Accrued Chief Compliance Officer fee payable		2,031
Accrued Trustees' fees payable		54
Other payables and accrued expenses		28,749
Total Liabilities		5,397,750
Net Assets	$	17,318,519

COMPOSITION OF NET ASSETS:
Paid-in capital	$	16,228,452
Total distributable earnings		1,090,067
Net Assets	$	17,318,519

PRICING OF SHARES:
Net Assets	$	17,318,519
Shares of beneficial interest outstanding (unlimited number of shares, no par value common share authorized)		781,857
Net Asset Value and redemption price per share	$	22.15

INVESTMENT INCOME:
Dividends	$	162
Interest		957,080
Total Investment Income		957,242

EXPENSES:
Fund accounting and administration fees (Note 4)		7,123
Legal fees		7,860
Audit and tax fees		17,917
Insurance expenses		9,549
Transfer agent fees (Note 4)		16,665
Advisory fees (Note 4)		94,886
Custodian fees		8,675
Trustees' fees and expenses (Note 4)		797
Printing expenses		5,314
Registration expenses		11,732
Recoupment of previously waived fees		32,817
Chief Compliance Officer fee (Note 4)		12,447
Interest on reverse repurchase agreements		626
Other expenses		3,391
Total expenses before waiver/reimbursement (Note 4)		229,799
Expense waiver/reimbursement (Note 4)		(77,036	)
Net expenses		152,763
Net Investment Income		804,479

REALIZED AND UNREALIZED GAIN/(LOSS) ON INVESTMENTS:
Net realized gain on investments		496,387
Net change in unrealized appreciation on investments		78,396
Net Realized and Unrealized Gain on Investments		574,783

Net Increase in Net Assets from Operations	$	1,379,262

	For the Six Months Ended April 30, 2021 (Unaudited)			For the Year Ended October 31, 2020
FROM OPERATIONS:
Net investment income	$	804,479		$	168,964
Net realized gain/(loss)		496,387			(62,904	)
Net change in unrealized appreciation		78,396			422,224
Net Increase in Net Assets from Operations		1,379,262			528,284

DISTRIBUTIONS TO SHAREHOLDERS:
From distributable earnings		(664,444	)		(194,674	)
Decrease in Net Assets from Distributions to Shareholders		(664,444	)		(194,674	)

CAPITAL SHARE TRANSACTIONS:
Proceeds from sale of shares of beneficial interest		4,068,556			11,742,290
Distributions reinvested		318,916			131,803
Disbursements for redemption of shares of beneficial interest		(652,552	)		(1,126,328	)
Net Increase from Capital Share Transactions		3,734,920			10,747,765
Net Increase in Net Assets		4,449,738			11,081,375

NET ASSETS:
Beginning of period		12,868,781			1,787,406
End of period	$	17,318,519		$	12,868,781

OTHER INFORMATION:
CAPITAL SHARE TRANSACTIONS:
Beginning shares		612,145			69,574
Issued		184,641			591,073
Distributions reinvested		14,438			5,791
Redeemed		(29,367	)		(54,293	)
Net increase in capital shares		169,712			542,571
Ending shares		781,857			612,145

	For the Six Months Ended April 30, 2021 (Unaudited)			For the Year Ended October 31, 2020			For the Period December 31, 2018 (Commencement of Operations) to October 31, 2019
OPERATING PERFORMANCE:
Net asset value - beginning of period	$	21.02		$	25.69		$	25.00
INCOME/(LOSS) FROM INVESTMENT OPERATIONS:
Net investment income^(a)		1.16			0.53			0.74
Net realized and unrealized gain on investments^(b)		0.91			(3.80	)		0.63
Total Income/(Loss) from Investment Operations		2.07			(3.27	)		1.37

DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income		(0.94	)		(0.76	)		(0.68	)
From net realized gains		–			(0.64	)		–
Total Distributions to Shareholders		(0.94	)		(1.40	)		(0.68	)

Net asset value - end of period	$	22.15		$	21.02		$	25.69

Total Investment Return - Net Asset Value^(c)		9.90	%^(d)		(13.22	%)		5.52	%^(d)

RATIOS AND SUPPLEMENTAL DATA:
Net assets end of period (000s)	$	17,319		$	12,869		$	1,787
Including Interest Expense
Ratio of expenses to average net assets excluding reimbursement^(e)		3.02	%^(f)		N/A			N/A
Ratio of expenses to average net assets including reimbursement^(e)		2.01	%^(f)		N/A			N/A
Excluding Interest Expense
Ratio of expenses to average net assets excluding reimbursement^(e)		3.01	%^(f)		12.00	%		60.30	%^(f)
Ratio of expenses to average net assets including reimbursement^(e)		2.00	%^(f)		2.00	%		2.00	%^(f)
Ratio of net investment income to average net assets^(e)		10.58	%^(f)		2.55	%		3.49	%^(f)
Portfolio turnover rate		34	%^(d)		56	%		48	%^(d)

	Overnight & Continuous	Up to 30 days		30-90 days		Greater than 90 days	Total
Commercial Mortgage-Backed Securities		$	–	$	1,503,000		$	1,503,000
Residential Mortgage-Backed Securities			–		1,686,000			1,686,000
Gross Amount of unrecognized liabilities for reverse repurchase agreements		$	–	$	3,189,000		$	3,189,000

							Gross Amounts Not Offset in the Statements of Assets and Liabilities
	Gross Amounts of Recognized Liabilities		Gross Amounts Offset in the Statements of Assets and Liabilities		Net Amounts Presented in the Statements of Assets and Liabilities		Financial Instruments Available for Offset^(a)			Cash Collateral Pledged^(a)		Net Amount Payable
Axonic Alternative Income Fund
Reverse repurchase agreements	$	3,189,000	$	–	$	3,189,000	$	(3,189,000	)	$	–	$	–
Total	$	3,189,000	$	–	$	3,189,000	$	(3,189,000	)	$	–	$	–

	Expires		Expires		Expires
Fund	2022		2023		2024		Total
Axonic Alternative Income Fund	$	809,420	$	663,354	$	77,036	$	1,549,810

	Board Considerations Regarding Approval of
Axonic Alternative Income Fund	Investment Advisory and Sub-Advisory Agreements
	April 30, 2021 (Unaudited)

Name and Year of Birth	Position with the Fund	Term of Office and Length of Time Served	Principal Occupation(s) During Past 5 Years	Number of Portfolios in Fund Complex* Overseen by Trustee	Other Directorships Held During the Past 5 Years
INDEPENDENT TRUSTEES OF THE FUND
Joshua M. Barlow 1978	Independent Trustee	Indefinite Term; Since April 15, 2020	Managing Director, Valhalla Fiduciary (June 2018 – present); Head of Operational Due Diligence and Accounting and other positions, PAAMCO (Pacific Alternative Asset Management Company, LLC) (March 2006 – June 2018).	2	Axonic Funds
Charles D. Mires 1960	Independent Trustee	Indefinite Term; Since April 15, 2020	Director CIB Marine Bancshares, Inc. (2010 – present); Retired from full time employment December, 2015; Director of Fixed Income, Alternative Strategies, and Third Party Mandates, Franklin Street Partners (2011- 2015).	2	Axonic Funds; CIB Marine Bancshares, Inc.
Thomas S. Vales 1964	Independent Trustee	Indefinite Term; Since April 15, 2020	Chief Executive Officer, TMC Bonds LLC (an alternative trading system for fixed income) (2000 – 2019); Member, FINRA Fixed Income Advisory Committee (2016-2018).	2	Axonic Funds
INTERESTED TRUSTEE OF THE FUND^**
Clayton DeGiacinto** 1972	Trustee, President (Principal Executive Officer)	Indefinite Term; Since Inception	Managing Member and Chief Investment Officer, Axonic Capital LLC (2010 – present).	2	Axonic Funds

By:	/s/ Clayton DeGiacinto
	Clayton DeGiacinto (Principal Executive Officer)
	Chief Executive Officer and President

Date:	July 2, 2021

By:	/s/ John R. Kelly
	John R. Kelly (Principal Financial Officer)
	Treasurer and Chief Financial Officer

Date:	July 2, 2021

By:	/s/ Clayton DeGiacinto
	Clayton DeGiacinto (Principal Executive Officer)
	President and Chief Executive Officer

Date:	July 2, 2021

Dated:	July 2, 2021

By:	/s/ Clayton DeGiacinto
	Clayton DeGiacinto (Principal Executive Officer)
	President and Chief Executive Officer