Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the Franklin Bitcoin ETF, 48016-48018 [2024-12144]
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48016
Federal Register / Vol. 89, No. 108 / Tuesday, June 4, 2024 / Notices
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange believes that the
proposal will not impose any burden on
competition that is not necessary or
appropriate in furtherance of the
purposes of Section 6(b)(8) of the Act.13
The proposed change would not affect
competition among national securities
exchanges or among members of the
Exchange. The proposed rule change is
not designed to address any competitive
issues but rather to enhance the clarity
and transparency of the Fee Schedule
and alleviate possible customer
confusion that may arise. The proposed
rule change would have no impact on
pricing or existing services. Rather, the
changes would clarify the Fee Schedule,
making it easier to understand and
alleviating any possible market
participant confusion.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
No written comments were solicited
or received with respect to the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
The Exchange has filed the proposed
rule change pursuant to Section
19(b)(3)(A)(iii) of the Act 14 and Rule
19b–4(f)(6) thereunder.15 Because the
proposed rule change does not: (i)
significantly affect the protection of
investors or the public interest; (ii)
impose any significant burden on
competition; and (iii) become operative
prior to 30 days from the date on which
it was filed, or such shorter time as the
Commission may designate, if
consistent with the protection of
investors and the public interest, the
proposed rule change has become
effective pursuant to Section 19(b)(3)(A)
of the Act and Rule 19b–4(f)(6)(iii)
thereunder.16
A proposed rule change filed under
Rule 19b–4(f)(6) 17 normally does not
become operative prior to 30 days after
the date of the filing. However, pursuant
to Rule 19b–4(f)(6)(iii),18 the
ddrumheller on DSK120RN23PROD with NOTICES1
13 15
U.S.C. 78f(b)(8).
14 15 U.S.C. 78s(b)(3)(A)(iii).
15 17 CFR 240.19b–4(f)(6).
16 17 CFR 240.19b–4(f)(6)(iii). In addition, Rule
19b–4(f)(6) requires a self-regulatory organization to
give the Commission written notice of its intent to
file the proposed rule change at least five business
days prior to the date of filing of the proposed rule
change, or such shorter time as designated by the
Commission. The Exchange has satisfied this
requirement.
17 17 CFR 240.19b–4(f)(6).
18 17 CFR 240.19b–4(f)(6)(iii).
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Commission may designate a shorter
time if such action is consistent with the
protection of investors and the public
interest. The Exchange has asked the
Commission to waive the 30-day
operative delay so that the proposal may
become operative immediately upon
filing.
The Commission agrees with the
Exchange that waiver of the 30-day
operative delay would be consistent
with the protection of investors and the
public interest because it would allow
the Exchange to implement this
proposed change immediately, ensuring
that Users could benefit from the 30-day
testing period for the existing service for
a wireless connection of MEMX Memoir
Depth data. Investors and the public
interest would also benefit from the
increased clarity and transparency the
other amendments would provide to the
Fee Schedule. The Commission
therefore believes that waiver of the 30day operative delay is appropriate.
At any time within 60 days of the
filing of such proposed rule change, the
Commission summarily may
temporarily suspend such rule change if
it appears to the Commission that such
action is necessary or appropriate in the
public interest, for the protection of
investors, or otherwise in furtherance of
the purposes of the Act. If the
Commission takes such action, the
Commission shall institute proceedings
under Section 19(b)(2)(B) 19 of the Act to
determine whether the proposed rule
change should be approved or
disapproved.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
Comments may be submitted by any of
the following methods:
Electronic Comments:
• Use the Commission’s internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include file number
SR–NYSECHX–2024–19 on the
subject line.
Paper Comments
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE,
Washington, DC 20549–1090.
All submissions should refer to file
number SR–NYSECHX–2024–19. This
file number should be included on the
subject line if email is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
internet website (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for website viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE,
Washington, DC 20549, on official
business days between the hours of 10
a.m. and 3 p.m. Copies of the filing also
will be available for inspection and
copying at the principal office of the
Exchange. Do not include personal
identifiable information in submissions;
you should submit only information
that you wish to make available
publicly. We may redact in part or
withhold entirely from publication
submitted material that is obscene or
subject to copyright protection. All
submissions should refer to file number
SR–NYSECHX–2024–19 and should be
submitted on or before June 25, 2024.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.20
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024–12141 Filed 6–3–24; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–100245; File No. SR–
CboeBZX–2024–040]
Self-Regulatory Organizations; Cboe
BZX Exchange, Inc.; Notice of Filing
and Immediate Effectiveness of a
Proposed Rule Change To Amend the
Franklin Bitcoin ETF
May 29, 2024.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934
(‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on May 16,
2024, Cboe BZX Exchange, Inc.
(‘‘Exchange’’) filed with the Securities
and Exchange Commission
20 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
19 15
PO 00000
U.S.C. 78s(b)(2)(B).
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Federal Register / Vol. 89, No. 108 / Tuesday, June 4, 2024 / Notices
(‘‘Commission’’) the proposed rule
change as described in Items I and II
below, which Items have been prepared
by the Exchange. The Exchange filed the
proposal as a ‘‘non-controversial’’
proposed rule change pursuant to
Section 19(b)(3)(A)(iii) of the Act 3 and
Rule 19b–4(f)(6) thereunder.4 The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
Cboe BZX Exchange, Inc. (‘‘BZX’’ or
the ‘‘Exchange’’) is filing with the
Securities and Exchange Commission
(‘‘Commission’’ or ‘‘SEC’’) a proposed
rule change to amend the Franklin
Bitcoin ETF (the ‘‘Fund’’), shares of
which are listed and traded on the
Exchange pursuant to BZX Rule
14.11(e)(4), to amend the time at which
purchase orders for cash transaction
creation baskets must be placed.
The text of the proposed rule change
is also available on the Exchange’s
website (https://markets.cboe.com/us/
equities/regulation/rule_filings/bzx/), at
the Exchange’s Office of the Secretary,
and at the Commission’s Public
Reference Room.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
Exchange included statements
concerning the purpose of and basis for
the proposed rule change and discussed
any comments it received on the
proposed rule change. The text of these
statements may be examined at the
places specified in Item IV below. The
Exchange has prepared summaries, set
forth in sections A, B, and C below, of
the most significant aspects of such
statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
ddrumheller on DSK120RN23PROD with NOTICES1
1. Purpose
The Commission approved the listing
and trading of shares of the Fund (the
‘‘Shares’’) on the Exchange pursuant to
Exchange Rule 14.11(e)(4), CommodityBased Trust Shares, on January 10,
2024.5 Exchange Rule 14.11(e)(4)
3 15
U.S.C. 78s(b)(3)(A)(iii).
CFR 240.19b–4(f)(6).
5 See Securities Exchange Act Release No. 99306
(January 10, 2024) 89 FR 3008 (January 17, 2024)
(File Nos. SR–NYSEARCA–2021–90; SR–
NYSEARCA–2023–44; SRNYSEARCA–2023–58;
4 17
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17:15 Jun 03, 2024
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governs the listing and trading of
Commodity-Based Trust Shares, which
means a security (a) that is issued by a
trust (‘‘Trust’’) that holds (1) a specified
commodity deposited with the Trust, or
(2) a specified commodity and, in
addition to such specified commodity,
cash; (b) that is issued by such Trust in
a specified aggregate minimum number
in return for a deposit of a quantity of
the underlying commodity and/or cash;
and (c) that, when aggregated in the
same specified minimum number, may
be redeemed at a holder’s request by
such Trust which will deliver to the
redeeming holder the quantity of the
underlying commodity and/or cash. The
Shares are issued by the Fund, a series
of Franklin Templeton Digital Holdings
Trust (the ‘‘Trust’’). The Trust was
formed as a Delaware statutory trust on
September 6, 2023.
The Exchange proposes to amend a
representation set forth in the
Exchange’s previous rule filing to list
and trade Shares of the Fund.6
Specifically, Amendment No. 1
represented that purchase orders for
cash transaction creation baskets must
be placed by 3:00 p.m. Eastern Time, or
the close of regular trading on the
Exchange, whichever is earlier. Now,
the Exchange proposes to amend the
time purchase orders for cash
transaction creation baskets must be
placed to 2:00 p.m. Eastern Time, the
close of regular trading on the Exchange,
or another time determined by the
Sponsor.7 The proposed change would
provide additional flexibility for the
Sponsor in determining the cut-off time
for submitting purchase orders for cash
transaction creation baskets.
Furthermore, at least one other issuer of
spot bitcoin exchange-traded products
(‘‘ETPs’’) has similarly provided for
flexibility to the sponsor in determining
the cut-off time for submitting such
purchase orders.8
SR–NASDAQ–2023–016; SR–NASDAQ–2023–019;
SR–CboeBZX–2023–028; SR–CboeBZX–2023–038;
SR–CboeBZX–2023–040; SR–CboeBZX–2023–042;
SRCboeBZX–2023–044; SR–CboeBZX–2023–072)
(Order Granting Accelerated Approval of Proposed
Rule Changes, as Modified by Amendments
Thereto, to List and Trade Bitcoin-Based
Commodity-Based Trust Shares and Trust Units)
(the ‘‘Approval Order’’).
6 See supra note 5 and see also Securities
Exchange Act Release No. 99286 (January 8, 2024)
89 FR 2372 (January 12, 2024) (SR–CboeBZX–2023–
072) (Notice of Filing of Amendment No. 1 to a
Proposed Rule Change to List and Trade Shares of
Franklin Bitcoin ETF Under BZX Rule 14.11(e)(4),
Commodity-Based Trust Shares)) (‘‘Amendment No.
1’’).
7 The sponsor of the Fund is Franklin Holdings,
LLC (the ‘‘Sponsor’’).
8 For example, the proposal to list and trade
shares of the ARK 21Shares Bitcoin ETF provided
for that purchase orders must be placed by 12:00
p.m. Eastern Time, the close of regular trading on
PO 00000
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48017
Except for the above change, all other
representations in Amendment No. 1
and the Approval Order remain
unchanged and will continue to
constitute continuing listing
requirements. In addition, the Fund will
continue to comply with the terms of
Amendment No. 1, the Approval Order,
and the requirements of Rule
14.11(e)(4).
2. Statutory Basis
The Exchange believes the proposed
rule change is consistent with the Act
and the rules and regulations
thereunder applicable to the Exchange
and, in particular, the requirements of
Section 6(b) of the Act.9 Specifically,
the Exchange believes the proposed rule
change is consistent with the Section
6(b)(5) 10 requirements that the rules of
an exchange be designed to prevent
fraudulent and manipulative acts and
practices, to promote just and equitable
principles of trade, to foster cooperation
and coordination with persons engaged
in regulating, clearing, settling,
processing information with respect to,
and facilitating transactions in
securities, to remove impediments to
and perfect the mechanism of a free and
open market and a national market
system, and, in general, to protect
investors and the public interest.
The Exchange believes the proposed
rule change is designed to remove
impediments to and perfect the
mechanism of a free and open market
and, in general, to protect investors and
the public interest because it would
update a representation in Amendment
No. 1 regarding the time at which
purchase orders for cash transaction
creation baskets must be placed. As
described above, the proposed change
would provide additional flexibility to
the Sponsor in determining the cut-off
time for such purchase orders. The
Exchange believes the proposal will
remove impediments to and perfect the
mechanism of a free and open market
because it would provide additional
flexibility to the creation and
redemption of Shares, which may result
in tighter spreads and a more efficient
market, to the benefit of all market
participants. Specifically, allowing for a
later cut-off time would provide
additional time for market participants
the Exchange, or another time determined by the
Sponsor. See Securities Exchange Act No. 99288
(January 8, 2024) 89 FR 2387 (January 12. 2024)
(SR–CboeBZX–2023–028) (Notice of Filing of
Amendment No. 5 to a Proposed Rule Change to
List and Trade Shares of the ARK 21Shares Bitcoin
ETF under BZX Rule 14.11(e)(4), Commodity-Based
Trust Shares). See also the Approval Order.
9 15 U.S.C. 78f(b).
10 15 U.S.C. 78f(b)(5).
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48018
Federal Register / Vol. 89, No. 108 / Tuesday, June 4, 2024 / Notices
to submit purchase orders which may
result in additional creation and/or
redemption units on the day, which
may in turn lead to tighter spreads and
a more efficient market, and conversely,
an earlier cut-off time may provide
additional time for the trust to manage
creation and redemptions, which may
be necessary due to unforeseen
circumstances. The Exchange believes
permitting this flexibility to the Sponsor
regarding the time at which purchase
orders for cash transaction creation
baskets must be placed, consistent with
at least one other issuer of spot bitcoin
ETP,11 would perfect the mechanism of
a free and open market, and is therefore,
consistent with section 6(b)(5) of the
Act.
B. Self-Regulatory Organization’s
Statement on Burden on Competition
The Exchange does not believe that
the proposed rule change will impose
any burden on competition that is not
necessary or appropriate in furtherance
of the purposes of the Act. As noted
above, the proposed amendment is
intended to change the time at which
purchase orders for cash transaction
creation baskets must be placed. The
Exchange believes that this change will
not impose any burden on competition.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
The Exchange neither solicited nor
received comments on the proposed
rule change.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
ddrumheller on DSK120RN23PROD with NOTICES1
Pursuant to Section 19(b)(3)(A) of the
Act 12 and Rule 19b–4(f)(6) 13
thereunder, the Exchange has
designated this proposal as one that
effects a change that: (i) does not
significantly affect the protection of
investors or the public interest; (ii) does
not impose any significant burden on
competition; and (iii) by its terms, does
not become operative for 30 days after
the date of the filing, or such shorter
time as the Commission may designate
if consistent with the protection of
investors and the public interest.14
11 Supra
note 7.
12 15 U.S.C. 78s(b)(3)(A).
13 17 CFR 240.19b–4(f)(6).
14 In addition, Rule 19b–4(f)(6) requires a selfregulatory organization to give the Commission
written notice of its intent to file the proposed rule
change at least five business days prior to the date
of filing of the proposed rule change, or such
shorter time as designated by the Commission. The
Exchange has satisfied this requirement.
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A proposed rule change filed
pursuant to Rule 19b–4(f)(6) under the
Act normally does not become operative
for 30 days after the date of its filing.
However, Rule 19b–4(f)(6)(iii) 15 permits
the Commission to designate a shorter
time if such action is consistent with the
protection of investors and the public
interest. The Exchange requested that
the Commission waive the 30-day
operative delay so that the proposal may
become operative immediately upon
filing. As discussed in greater detail
above, the Exchange represents that the
proposal would provide additional
flexibility to the Sponsor in determining
the cut-off time for submitting purchase
orders for cash transaction creation
baskets, which may result in tighter
spreads and a more efficient market.
Furthermore, at least one other issuer of
spot bitcoin ETPs has similarly
provided for flexibility to the sponsor in
determining the cut-off time for
submitting purchase orders.16 The
Exchange further represents that except
for the change discussed herein, all
other representations in Amendment
No. 1 and the Approval Order remain
unchanged and will continue to
constitute continuing listing
requirements, and the Fund will
continue to comply with the terms of
Amendment No. 1, the Approval Order,
and the requirements of Rule
14.11(e)(4). The proposed rule change
thus raises no novel legal or regulatory
issues. Therefore, the Commission
believes that waiver of the 30-day
operative delay is consistent with the
protection of investors and the public
interest. Accordingly, the Commission
hereby waives the 30-day operative
delay and designates the proposed rule
change operative upon filing.17
At any time within 60 days of the
filing of the proposed rule change, the
Commission summarily may
temporarily suspend such rule change if
it appears to the Commission that such
action is necessary or appropriate in the
public interest, for the protection of
investors, or otherwise in furtherance of
the purposes of the Act.
IV. Solicitation of Comments
Interested persons are invited to
submit written data, views, and
arguments concerning the foregoing,
including whether the proposed rule
change is consistent with the Act.
15 17
CFR 240.19b–4(f)(6)(iii).
supra note 8.
17 For purposes only of waiving the 30-day
operative delay, the Commission has also
considered the proposed rule’s impact on
efficiency, competition, and capital formation. See
15 U.S.C. 78c(f).
16 See
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Comments may be submitted by any of
the following methods:
Electronic Comments
• Use the Commission’s internet
comment form (https://www.sec.gov/
rules/sro.shtml); or
• Send an email to rule-comments@
sec.gov. Please include file number SR–
CboeBZX–2024–040 on the subject line.
Paper Comments
• Send paper comments in triplicate
to Secretary, Securities and Exchange
Commission, 100 F Street NE,
Washington, DC 20549–1090.
All submissions should refer to file
number SR–CboeBZX–2024–040. This
file number should be included on the
subject line if email is used. To help the
Commission process and review your
comments more efficiently, please use
only one method. The Commission will
post all comments on the Commission’s
internet website (https://www.sec.gov/
rules/sro.shtml). Copies of the
submission, all subsequent
amendments, all written statements
with respect to the proposed rule
change that are filed with the
Commission, and all written
communications relating to the
proposed rule change between the
Commission and any person, other than
those that may be withheld from the
public in accordance with the
provisions of 5 U.S.C. 552, will be
available for website viewing and
printing in the Commission’s Public
Reference Room, 100 F Street NE,
Washington, DC 20549, on official
business days between the hours of 10
a.m. and 3 p.m. Copies of the filing also
will be available for inspection and
copying at the principal office of the
Exchange. Do not include personal
identifiable information in submissions;
you should submit only information
that you wish to make available
publicly. We may redact in part or
withhold entirely from publication
submitted material that is obscene or
subject to copyright protection. All
submissions should refer to file number
SR–CboeBZX–2024–040 and should be
submitted on or before June 25, 2024.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.18
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024–12144 Filed 6–3–24; 8:45 am]
BILLING CODE 8011–01–P
18 17
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CFR 200.30–3(a)(12), (59).
04JNN1
]]>Agencies
[Federal Register Volume 89, Number 108 (Tuesday, June 4, 2024)]
[Notices]
[Pages 48016-48018]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-12144]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-100245; File No. SR-CboeBZX-2024-040]
Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change To Amend
the Franklin Bitcoin ETF
May 29, 2024.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on May 16, 2024, Cboe BZX Exchange, Inc. (``Exchange'') filed with the
Securities and Exchange Commission
[[Page 48017]]
(``Commission'') the proposed rule change as described in Items I and
II below, which Items have been prepared by the Exchange. The Exchange
filed the proposal as a ``non-controversial'' proposed rule change
pursuant to Section 19(b)(3)(A)(iii) of the Act \3\ and Rule 19b-
4(f)(6) thereunder.\4\ The Commission is publishing this notice to
solicit comments on the proposed rule change from interested persons.
---------------------------------------------------------------------------
\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
\3\ 15 U.S.C. 78s(b)(3)(A)(iii).
\4\ 17 CFR 240.19b-4(f)(6).
---------------------------------------------------------------------------
I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
Cboe BZX Exchange, Inc. (``BZX'' or the ``Exchange'') is filing
with the Securities and Exchange Commission (``Commission'' or ``SEC'')
a proposed rule change to amend the Franklin Bitcoin ETF (the
``Fund''), shares of which are listed and traded on the Exchange
pursuant to BZX Rule 14.11(e)(4), to amend the time at which purchase
orders for cash transaction creation baskets must be placed.
The text of the proposed rule change is also available on the
Exchange's website (https://markets.cboe.com/us/equities/regulation/rule_filings/bzx/), at the Exchange's Office of the Secretary, and at
the Commission's Public Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant aspects of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Commission approved the listing and trading of shares of the
Fund (the ``Shares'') on the Exchange pursuant to Exchange Rule
14.11(e)(4), Commodity-Based Trust Shares, on January 10, 2024.\5\
Exchange Rule 14.11(e)(4) governs the listing and trading of Commodity-
Based Trust Shares, which means a security (a) that is issued by a
trust (``Trust'') that holds (1) a specified commodity deposited with
the Trust, or (2) a specified commodity and, in addition to such
specified commodity, cash; (b) that is issued by such Trust in a
specified aggregate minimum number in return for a deposit of a
quantity of the underlying commodity and/or cash; and (c) that, when
aggregated in the same specified minimum number, may be redeemed at a
holder's request by such Trust which will deliver to the redeeming
holder the quantity of the underlying commodity and/or cash. The Shares
are issued by the Fund, a series of Franklin Templeton Digital Holdings
Trust (the ``Trust''). The Trust was formed as a Delaware statutory
trust on September 6, 2023.
---------------------------------------------------------------------------
\5\ See Securities Exchange Act Release No. 99306 (January 10,
2024) 89 FR 3008 (January 17, 2024) (File Nos. SR-NYSEARCA-2021-90;
SR-NYSEARCA-2023-44; SRNYSEARCA-2023-58; SR-NASDAQ-2023-016; SR-
NASDAQ-2023-019; SR-CboeBZX-2023-028; SR-CboeBZX-2023-038; SR-
CboeBZX-2023-040; SR-CboeBZX-2023-042; SRCboeBZX-2023-044; SR-
CboeBZX-2023-072) (Order Granting Accelerated Approval of Proposed
Rule Changes, as Modified by Amendments Thereto, to List and Trade
Bitcoin-Based Commodity-Based Trust Shares and Trust Units) (the
``Approval Order'').
---------------------------------------------------------------------------
The Exchange proposes to amend a representation set forth in the
Exchange's previous rule filing to list and trade Shares of the
Fund.\6\ Specifically, Amendment No. 1 represented that purchase orders
for cash transaction creation baskets must be placed by 3:00 p.m.
Eastern Time, or the close of regular trading on the Exchange,
whichever is earlier. Now, the Exchange proposes to amend the time
purchase orders for cash transaction creation baskets must be placed to
2:00 p.m. Eastern Time, the close of regular trading on the Exchange,
or another time determined by the Sponsor.\7\ The proposed change would
provide additional flexibility for the Sponsor in determining the cut-
off time for submitting purchase orders for cash transaction creation
baskets. Furthermore, at least one other issuer of spot bitcoin
exchange-traded products (``ETPs'') has similarly provided for
flexibility to the sponsor in determining the cut-off time for
submitting such purchase orders.\8\
---------------------------------------------------------------------------
\6\ See supra note 5 and see also Securities Exchange Act
Release No. 99286 (January 8, 2024) 89 FR 2372 (January 12, 2024)
(SR-CboeBZX-2023-072) (Notice of Filing of Amendment No. 1 to a
Proposed Rule Change to List and Trade Shares of Franklin Bitcoin
ETF Under BZX Rule 14.11(e)(4), Commodity-Based Trust Shares))
(``Amendment No. 1'').
\7\ The sponsor of the Fund is Franklin Holdings, LLC (the
``Sponsor'').
\8\ For example, the proposal to list and trade shares of the
ARK 21Shares Bitcoin ETF provided for that purchase orders must be
placed by 12:00 p.m. Eastern Time, the close of regular trading on
the Exchange, or another time determined by the Sponsor. See
Securities Exchange Act No. 99288 (January 8, 2024) 89 FR 2387
(January 12. 2024) (SR-CboeBZX-2023-028) (Notice of Filing of
Amendment No. 5 to a Proposed Rule Change to List and Trade Shares
of the ARK 21Shares Bitcoin ETF under BZX Rule 14.11(e)(4),
Commodity-Based Trust Shares). See also the Approval Order.
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Except for the above change, all other representations in Amendment
No. 1 and the Approval Order remain unchanged and will continue to
constitute continuing listing requirements. In addition, the Fund will
continue to comply with the terms of Amendment No. 1, the Approval
Order, and the requirements of Rule 14.11(e)(4).
2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
the Act and the rules and regulations thereunder applicable to the
Exchange and, in particular, the requirements of Section 6(b) of the
Act.\9\ Specifically, the Exchange believes the proposed rule change is
consistent with the Section 6(b)(5) \10\ requirements that the rules of
an exchange be designed to prevent fraudulent and manipulative acts and
practices, to promote just and equitable principles of trade, to foster
cooperation and coordination with persons engaged in regulating,
clearing, settling, processing information with respect to, and
facilitating transactions in securities, to remove impediments to and
perfect the mechanism of a free and open market and a national market
system, and, in general, to protect investors and the public interest.
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\9\ 15 U.S.C. 78f(b).
\10\ 15 U.S.C. 78f(b)(5).
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The Exchange believes the proposed rule change is designed to
remove impediments to and perfect the mechanism of a free and open
market and, in general, to protect investors and the public interest
because it would update a representation in Amendment No. 1 regarding
the time at which purchase orders for cash transaction creation baskets
must be placed. As described above, the proposed change would provide
additional flexibility to the Sponsor in determining the cut-off time
for such purchase orders. The Exchange believes the proposal will
remove impediments to and perfect the mechanism of a free and open
market because it would provide additional flexibility to the creation
and redemption of Shares, which may result in tighter spreads and a
more efficient market, to the benefit of all market participants.
Specifically, allowing for a later cut-off time would provide
additional time for market participants
[[Page 48018]]
to submit purchase orders which may result in additional creation and/
or redemption units on the day, which may in turn lead to tighter
spreads and a more efficient market, and conversely, an earlier cut-off
time may provide additional time for the trust to manage creation and
redemptions, which may be necessary due to unforeseen circumstances.
The Exchange believes permitting this flexibility to the Sponsor
regarding the time at which purchase orders for cash transaction
creation baskets must be placed, consistent with at least one other
issuer of spot bitcoin ETP,\11\ would perfect the mechanism of a free
and open market, and is therefore, consistent with section 6(b)(5) of
the Act.
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\11\ Supra note 7.
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B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act. As noted above, the proposed
amendment is intended to change the time at which purchase orders for
cash transaction creation baskets must be placed. The Exchange believes
that this change will not impose any burden on competition.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
The Exchange neither solicited nor received comments on the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Pursuant to Section 19(b)(3)(A) of the Act \12\ and Rule 19b-
4(f)(6) \13\ thereunder, the Exchange has designated this proposal as
one that effects a change that: (i) does not significantly affect the
protection of investors or the public interest; (ii) does not impose
any significant burden on competition; and (iii) by its terms, does not
become operative for 30 days after the date of the filing, or such
shorter time as the Commission may designate if consistent with the
protection of investors and the public interest.\14\
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\12\ 15 U.S.C. 78s(b)(3)(A).
\13\ 17 CFR 240.19b-4(f)(6).
\14\ In addition, Rule 19b-4(f)(6) requires a self-regulatory
organization to give the Commission written notice of its intent to
file the proposed rule change at least five business days prior to
the date of filing of the proposed rule change, or such shorter time
as designated by the Commission. The Exchange has satisfied this
requirement.
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A proposed rule change filed pursuant to Rule 19b-4(f)(6) under the
Act normally does not become operative for 30 days after the date of
its filing. However, Rule 19b-4(f)(6)(iii) \15\ permits the Commission
to designate a shorter time if such action is consistent with the
protection of investors and the public interest. The Exchange requested
that the Commission waive the 30-day operative delay so that the
proposal may become operative immediately upon filing. As discussed in
greater detail above, the Exchange represents that the proposal would
provide additional flexibility to the Sponsor in determining the cut-
off time for submitting purchase orders for cash transaction creation
baskets, which may result in tighter spreads and a more efficient
market. Furthermore, at least one other issuer of spot bitcoin ETPs has
similarly provided for flexibility to the sponsor in determining the
cut-off time for submitting purchase orders.\16\ The Exchange further
represents that except for the change discussed herein, all other
representations in Amendment No. 1 and the Approval Order remain
unchanged and will continue to constitute continuing listing
requirements, and the Fund will continue to comply with the terms of
Amendment No. 1, the Approval Order, and the requirements of Rule
14.11(e)(4). The proposed rule change thus raises no novel legal or
regulatory issues. Therefore, the Commission believes that waiver of
the 30-day operative delay is consistent with the protection of
investors and the public interest. Accordingly, the Commission hereby
waives the 30-day operative delay and designates the proposed rule
change operative upon filing.\17\
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\15\ 17 CFR 240.19b-4(f)(6)(iii).
\16\ See supra note 8.
\17\ For purposes only of waiving the 30-day operative delay,
the Commission has also considered the proposed rule's impact on
efficiency, competition, and capital formation. See 15 U.S.C.
78c(f).
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At any time within 60 days of the filing of the proposed rule
change, the Commission summarily may temporarily suspend such rule
change if it appears to the Commission that such action is necessary or
appropriate in the public interest, for the protection of investors, or
otherwise in furtherance of the purposes of the Act.
IV. Solicitation of Comments
Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
Send an email to [email protected]. Please include
file number SR-CboeBZX-2024-040 on the subject line.
Paper Comments
Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
All submissions should refer to file number SR-CboeBZX-2024-040. This
file number should be included on the subject line if email is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (https://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for website viewing and
printing in the Commission's Public Reference Room, 100 F Street NE,
Washington, DC 20549, on official business days between the hours of 10
a.m. and 3 p.m. Copies of the filing also will be available for
inspection and copying at the principal office of the Exchange. Do not
include personal identifiable information in submissions; you should
submit only information that you wish to make available publicly. We
may redact in part or withhold entirely from publication submitted
material that is obscene or subject to copyright protection. All
submissions should refer to file number SR-CboeBZX-2024-040 and should
be submitted on or before June 25, 2024.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\18\
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\18\ 17 CFR 200.30-3(a)(12), (59).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024-12144 Filed 6-3-24; 8:45 am]
BILLING CODE 8011-01-P
