[Self-Regulatory Organizations; Nasdaq ISE, LLC; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Expand its Co- Location Services, 60479-60482 [2024-16299]
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Federal Register / Vol. 89, No. 143 / Thursday, July 25, 2024 / Notices
opportunities for market participants
and improved price transparency.
Greater overall order flow, trading
opportunities, and pricing transparency
benefits all market participants on the
Exchange by enhancing market quality
and continuing to encourage Members
to send orders, thereby contributing
towards a robust and well-balanced
market ecosystem.
Next, the Exchange believes the
proposed rule changes do not impose
any burden on intermarket competition
that is not necessary or appropriate in
furtherance of the purposes of the Act.
As previously discussed, the Exchange
operates in a highly competitive market.
Members have numerous alternative
venues that they may participate on and
direct their order flow, including other
equities exchanges, off-exchange
venues, and alternative trading systems.
Additionally, the Exchange represents a
small percentage of the overall market.
Based on publicly available information,
no single equities exchange has more
than 17% of the market share.21
Therefore, no exchange possesses
significant pricing power in the
execution of order flow. Indeed,
participants can readily choose to send
their orders to other exchange and offexchange venues if they deem fee levels
at those other venues to be more
favorable. Moreover, the Commission
has repeatedly expressed its preference
for competition over regulatory
intervention in determining prices,
products, and services in the securities
markets. Specifically, in Regulation
NMS, the Commission highlighted the
importance of market forces in
determining prices and SRO revenues
and, also, recognized that current
regulation of the market system ‘‘has
been remarkably successful in
promoting market competition in its
broader forms that are most important to
investors and listed companies.’’ 22 The
fact that this market is competitive has
also long been recognized by the courts.
In NetCoalition v. Securities and
Exchange Commission, the D.C. Circuit
stated as follows: ‘‘[n]o one disputes
that competition for order flow is
‘fierce.’ . . . As the SEC explained, ‘[i]n
the U.S. national market system, buyers
and sellers of securities, and the brokerdealers that act as their order-routing
agents, have a wide range of choices of
where to route orders for execution’;
[and] ‘no exchange can afford to take its
market share percentages for granted’
because ‘no exchange possesses a
monopoly, regulatory or otherwise, in
21 Supra
note 2.
Securities Exchange Act Release No. 51808
(June 9, 2005), 70 FR 37496, 37499 (June 29, 2005).
22 See
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the execution of order flow from broker
dealers’. . . .’’.23 Accordingly, the
Exchange does not believe its proposed
fee change imposes any burden on
competition that is not necessary or
appropriate in furtherance of the
purposes of the Act.
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
The foregoing rule change has become
effective pursuant to Section 19(b)(3)(A)
of the Act 24 and paragraph (f) of Rule
19b–4 25 thereunder. 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. If the
Commission takes such action, the
Commission will institute proceedings
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–
CboeEDGA–2024–027 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–CboeEDGA–2024–027. This
file number should be included on the
23 NetCoalition v. SEC, 615 F.3d 525, 539 (D.C.
Cir. 2010) (quoting Securities Exchange Act Release
No. 59039 (December 2, 2008), 73 FR 74770, 74782–
83 (December 9, 2008) (SR–NYSEArca–2006–21)).
24 15 U.S.C. 78s(b)(3)(A).
25 17 CFR 240.19b–4(f).
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60479
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–CboeEDGA–2024–027 and should
be submitted on or before August 15,
2024.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.26
J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2024–16302 Filed 7–24–24; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–100563; File No. SR–ISE–
2024–28]
[Self-Regulatory Organizations;
Nasdaq ISE, LLC; Notice of Filing and
Immediate Effectiveness of Proposed
Rule Change To Expand its CoLocation Services
July 19, 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 July 5,
2024, Nasdaq ISE, LLC (‘‘ISE’’ or
‘‘Exchange’’) filed with the Securities
DATES:
26 17
CFR 200.30–3(a)(12).
U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
1 15
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Federal Register / Vol. 89, No. 143 / Thursday, July 25, 2024 / Notices
and Exchange Commission (‘‘SEC’’ or
‘‘Commission’’) the proposed rule
change as described in Items I, II, and
III, below, which Items have been
prepared by the Exchange. 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
The Exchange proposes to expand its
co-location services.
The text of the proposed rule change
is available on the Exchange’s website at
https://listingcenter.nasdaq.com/
rulebook/ise/rules, at the principal
office of the Exchange, 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
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The Exchange proposes to expand its
co-location services by offering new
cabinet, power, and power distribution
unit options in the Exchange’s
expanded data center.
The Exchange’s current data center
(‘‘NY11’’) in Carteret, NJ is undergoing
an expansion (‘‘NY11–4’’) in response to
demand for power and cabinets. NY11–
4 is not a new or distinct co-location
facility. Instead, NY11–4 is simply an
expansion of the existing NY11 data
center,3 and the Exchange intends to
operate it generally in the same manner
as existing aspects of NY11.4 Client
3 NY11–4 is not a standalone facility. Equinix
considers the site as NY11 with three expansions:
NY11–2, NY11–3, and NY11–4.
4 One aspect of the data center that will be treated
differently in NY11–4 as compared to NY11 at its
outset is telecommunications access and inter-client
connectivity. In NY11–4, connections between
colocated client cabinets and the carrier cage will
be of equal length. Inter-client connectivity will
also be equalized in NY11–4. The Exchange
believes that equalizing telecommunications access
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connections to the matching engine will
be equal across the board, within and
among NY11 and NY11–4.
The Exchange submits this filing to
propose offering new services in NY11–
4, as described below, and to the extent
the Exchange offers additional new
services, whether in the existing NY11
data halls or in the new NY11–4 data
hall, the Exchange will submit
additional filings with the Commission.
NY11–4 Expanded Cabinet Optionality:
Ultra High Density Cabinet
Currently, co-location customers have
the option of obtaining cabinets of
various sizes and power densities. Colocation customers may obtain a Half
Cabinet,5 a Low Density Cabinet with
power density less than or equal to 2.88
kilowatts (‘‘kW’’), a Medium Density
Cabinet with power density greater than
2.88 kW and less than or equal to 5 kW,
a Medium-High Density Cabinet with
power density greater than 5 kW and
less than or equal to 7 kW, a High
Density Cabinet with power density
greater than 7 kW and less than 10 kW,
and a Super High Density Cabinet with
power density greater than 10 kW and
less than or equal to 17.3 kW.
The Exchange proposes to introduce a
new cabinet choice in NY11–4, an
‘‘Ultra High Density Cabinet,’’ with
power density greater than 10 kW and
less than or equal to 15 kW. Based on
demand, the Exchange wishes to
introduce the Ultra High Density
Cabinet as an option for customers
between the High Density Cabinet and
the Super High Density Cabinet. The
Ultra High Density Cabinet option
would only be offered in NY11–4
because of the power configuration
necessary for such cabinets, which is
not possible or available in other
portions of the data center due to
different power distribution. Because of
the addition of the Ultra High Density
Cabinet option in NY11–4, the Super
High Density Cabinet in NY11–4 would
have power density greater than 15 kW
and less than or equal to 17.3 kW.
In addition to the Ultra High Density
Cabinet, the Exchange would offer the
other, existing cabinet options in NY11–
4, with the exception of the Low Density
Cabinet and Half Cabinet due to a lack
of demand for such cabinets. The
cabinets in NY11–4 will include certain
and inter-client connectivity in NY11–4 will
provide a fair solution and avoid market disruption
by avoiding both a race for real estate adjacent to
NY11–4 and for particular space in NY11–4. The
Exchange believes that these actions would
facilitate a fair and orderly market and protect
investors and the public interest, consistent with its
obligations under the Act.
5 Half cabinets are not available to new
subscribers. See General 8, Section 1(a).
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features, including but not limited to:
uniform, wider cabinets 6 (32″ W x 48″
D x 91″ H), cable management, and a
rear split door and combo lock.
NY11–4 Cabinet Power and Power
Distribution Units
The Exchange currently provides
various cabinet power options,
including: 2x20 amp 110 volt, 2x30 amp
110 volt, 2x20 amp 208 volt, 2x30 amp
208 volt, Phase 3 2x 20 amp 208 volt,
Phase 3 2x 30 amp 208 volt, 2x60 amp
208 volt, Phase 3 2x 40 amp 208 volt,
Phase 3 2x 50 amp 208 volt, Phase 3 2x
60 amp 208 volt, and 2x30 amp 48 volt
DC. For NY11–4, the data center
operator is bringing in higher voltage
power options, which are more
consistent with power options used in
other data centers across the globe. The
Exchange proposes to amend General 8,
Section 1(c) to add the cabinet power
options for NY11–4, which include:
Phase 1 20 amp 240 volt, Phase 1 32
amp 240 volt, Phase 1 40 amp 240 volt,
Phase 3 20 amp 415 volt, and Phase 3
32 amp 415 volt. The Exchange also
proposes to specify in its Rules that
these cabinet power options are specific
to NY11–4 and that one of these options
must be selected for cabinets in NY11–
4. Although different cabinet power
options will be offered in NY11 and
NY11–4 due to differing power
configurations, the new cabinet power
options are not inherently preferable to
the existing cabinet power options and
the Exchange does not anticipate
material differences in equipment
performance based on the power
distribution.7 Due to higher voltage
options being offered in NY11–4, the
data center operator is likely to
experience increased power distribution
efficiencies across the data center. As
between the various cabinet power
options, customers choose power based
on their preference and capacity needs.
The Exchange also proposes to offer
power distribution units (‘‘PDUs’’) 8 in
NY11–4 as a convenience to customers.
Rather than sourcing PDUs on a
customer-by-customer basis, as the
Exchange does for customers in NY11,
6 In the existing data halls, clients may bring their
own cabinets or use Exchange-provided cabinets.
Because of the cooling system in NY11–4 (hot aisle
containment), all cabinets must be uniform and
therefore, the Exchange will provide all cabinets.
The existing data halls utilize cold aisle
containment to manage temperatures. Hot aisle
containment is a more effective way to manage heat
in the data center.
7 Customers in NY11–4 will receive comparable
power draw/consumption as compared to NY11.
Any differences between efficiencies in the
customer equipment are negligible.
8 PDUs are devices fitted with multiple outputs
designed to distribute electric power. The
standardized PDUs would only be offered for
NY11–4.
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Federal Register / Vol. 89, No. 143 / Thursday, July 25, 2024 / Notices
the Exchange wishes to simplify and
standardize its PDU offering in NY11–
4 by offering Phase 1 and Phase 3 9
power distribution units. This service is
optional and customers may choose to
provide their own PDUs appropriate for
their power installation choices. The
Exchange also proposes to offer a switch
monitored PDU add on in NY11–4,
which would allow customers to
connect remotely to their PDU and
control the power sockets. With the
switch monitored PDU option,
customers would be able to power cycle
or shut off power remotely. This option
is optional as well and customers may
choose to provide their own switch
monitored PDU, if desired.
Implementation
Although the timing is subject to
change,10 the Exchange anticipates
opening NY11–4 Exchange access on
October 21, 2024 and providing
customers access to the space on or after
August 5, 2024. In concert with this
filing, the Exchange will allow
customers to place orders for NY11–4,
which would not be fee liable until
customers are provided access to the
space.11 The Exchange will submit a fee
filing to establish fees for the services
described herein. Allowing customers to
place orders in advance of opening its
doors will allow the Exchange to plan
ahead for capacity and demand for
services, as well as procure necessary
equipment.
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2. Statutory Basis
The Exchange believes that its
proposal is consistent with Section 6(b)
of the Act,12 in general, and furthers the
objectives of Section 6(b)(5) of the Act,13
in particular, in that it is designed to
promote just and equitable principles of
trade, 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. Today,
9 Phase 1 PDUs would be compatible with the
following power options: Phase 1 20 amp 240 volt,
Phase 1 32 amp 240 volt, and Phase 1 40 amp 240
volt. Phase 3 PDUs would be compatible with the
following power options: Phase 3 20 amp 415 volt
and Phase 3 32 amp 415 volt. Phase 1 and Phase
3 are available in NY11 and NY11–4. Phase 3 PDUs
provide greater power density than Phase 1 PDUs
by delivering power over three wires as opposed to
one wire.
10 The Exchange will announce modifications to
the proposed timing via the Nasdaq Customer
Portal, which is the web portal used for order and
inventory management of colocation services, and
email communication to all colocation customers.
11 Charging customers once access is provided is
consistent with current practice and allows
customers to set up equipment and begin using
power.
12 15 U.S.C. 78f(b).
13 15 U.S.C. 78f(b)(5).
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the Exchange offers various cabinet
choices and power options in the data
center for colocation customers. The
proposal would expand the cabinet and
power options available, by introducing
an additional cabinet option, the Ultra
High Density Cabinet, and new power
choices. The proposal would benefit the
public interest by providing customers
more cabinet and power options to
choose from, thereby enhancing their
ability to tailor their colocation
operations to the requirements of their
business operations. In general, the
proposal is consistent with the Act
because the Exchange’s expansion of the
data center and expansion of available
power and cabinets will enable the
Exchange to meet customer needs and
address demand for both cabinets and
power. In lieu of collocating directly
with the Exchange, market participants
may choose not to collocate at all or to
collocate indirectly through a vendor.
The Exchange also believes that the
proposal will not be unfairly
discriminatory, consistent with the
objectives of Section 6(b)(5) of the Act 14
because the expanded cabinet and
power options in the data center would
be offered equally to all customers.
Although certain optionality is only
offered in NY11–4 because of different
power configurations in NY11–4 as
compared to NY11, NY11–4 is merely
an expansion of the data center, and any
customer may order cabinets and power
in NY11–4 (and across the data center
broadly) on the same terms as any other
customer.
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 not
necessary or appropriate in furtherance
of the purposes of the Act.
Nothing in the proposal imposes any
burden on the ability of other exchanges
to compete. The Exchange operates in a
highly competitive market in which
exchanges and other vendors offer
colocation services as a means to
facilitate the trading and other market
activities of those market participants
who believe that colocation enhances
the efficiency of their operations. As
part of its colocation offering, the
Exchange currently offers similar
cabinets and power, as do other
exchanges.
Nothing in the Proposal burdens
intra-market competition because the
Exchange’s colocation services,
including those proposed herein, are
available to any customer and customers
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14 Id.
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60481
that wish to order cabinets and power
can do so on a non-discriminatory basis.
Use of any colocation service is
completely voluntary, and each market
participant is able to determine whether
to use colocation services based on the
requirements of its business operations.
C. Self-Regulatory Organization’s
Statement on Comments on the
Proposed Rule Change Received From
Members, Participants, or Others
No written comments were either
solicited or received.
III. Date of Effectiveness of the
Proposed Rule Change and Timing for
Commission Action
Because the foregoing 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 for 30 days from the date on
which it was filed, or such shorter time
as the Commission may designate, it has
become effective pursuant to Section
19(b)(3)(A)(iii) of the Act 15 and
subparagraph (f)(6) of Rule 19b–4
thereunder.16
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. If the
Commission takes such action, the
Commission shall institute proceedings
to determine whether the proposed rule
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–
ISE–2024–28 on the subject line.
15 15
U.S.C. 78s(b)(3)(A)(iii).
CFR 240.19b–4(f)(6). 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.
16 17
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Federal Register / Vol. 89, No. 143 / Thursday, July 25, 2024 / Notices
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–ISE–2024–28. 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–ISE–2024–28 and should be
submitted on or before August 15, 2024.
For the Commission, by the Division of
Trading and Markets, pursuant to delegated
authority.17
J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2024–16299 Filed 7–24–24; 8:45 am]
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BILLING CODE 8011–01–P
17 17
CFR 200.30–3(a)(12).
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SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–100567; File Nos. SR–BOX–
2024–07; SR–CBOE–2024–005; SR–ISE–
2024–03; SR–ISE–2024–14; SR–MIAX–2024–
03; SR–NYSEAMER–2024–10; SR–PEARL–
2024–03]
Self-Regulatory Organizations; BOX
Exchange LLC; Cboe Exchange, Inc.;
MIAX International Securities
Exchange LLC; MIAX PEARL LLC;
Nasdaq ISE, LLC; NYSE American
LLC; Notice of Designation of a Longer
Period for Commission Action on
Proceedings To Determine Whether To
Approve or Disapprove Proposed Rule
Changes To Permit the Listing and
Trading of Options on Trusts That Hold
Bitcoin
July 19, 2024.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (‘‘Act’’
or ‘‘Exchange Act’’) 1 and Rule 19b–4
thereunder,2 BOX Exchange LLC
(‘‘BOX’’); Cboe Exchange, Inc. (‘‘Cboe
Options’’); MIAX International
Securities Exchange LLC (‘‘MIAX’’);
MIAX PEARL LLC (‘‘MIAX Pearl’’);
Nasdaq ISE, LLC (‘‘ISE’’); and NYSE
American LLC (‘‘NYSE American’’) filed
with the Securities and Exchange
Commission (‘‘Commission’’) proposed
rule changes to list and trade options on
exchange-traded product shares that
represent interests in either a specified
bitcoin trust or in any trust that holds
bitcoin, as described below (each, a
‘‘Proposal’’ and collectively, the
‘‘Proposals’’). Specifically, ISE proposed
to list and trade options on shares that
represent interests in the iShares Bitcoin
Trust.3 BOX, Cboe Options, MIAX,
MIAX Pearl and, in a second filing, ISE,
proposed to list and trade options on
shares that represent interests in a trust
that holds bitcoin.4 NYSE American
U.S.C. 78s(b)(1).
CFR 240.19b–4.
3 See File No. SR–ISE–2024–03 (‘‘ISE iShares
Proposal’’), filed Jan. 9, 2024. On January 10, 2024,
the Commission approved proposals by NYSE Arca,
Inc., The Nasdaq Stock Market LLC, and Cboe BZX
Exchange, Inc. to list and trade the shares of 11
bitcoin-based commodity-based trust shares and
trust units, including the iShares Bitcoin Trust, the
Grayscale Bitcoin Trust, and the Bitwise Bitcoin
ETF. See Securities Exchange Act Release No.
99306 (Jan. 10, 2024), 89 FR 3008 (Jan. 17, 2024)
(order approving File Nos. SR–NYSEARCA–2021–
90; SR–NYSEARCA–2023–44; SR–NYSEARCA–
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; SR–CboeBZX–2023–044; SR–CboeBZX–
2023–072).
4 See File Nos. SR–BOX–2024–07 (‘‘BOX
Proposal’’), filed Mar. 11, 2024; SR–CBOE–2024–
005 (‘‘Cboe Options Proposal’’), filed Jan. 5, 2024;
SR–ISE–2024–14 (‘‘ISE Trust Proposal’’), filed Mar.
19, 2024; SR–MIAX–2024–03 (‘‘MIAX Proposal’’),
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1 15
2 17
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proposed to list and trade options on
shares that represent interests in the
Bitwise Bitcoin ETF, the Grayscale
Bitcoin Trust, and on any trust that
holds bitcoin.5
On January 25, 2024, the Cboe
Options Proposal,6 the ISE iShares
Proposal,7 the MIAX Proposal,8 and the
MIAX Pearl Proposal 9 were published
for comment in the Federal Register. On
March 6, 2024, pursuant to Section
19(b)(2) of the Act,10 the Commission
designated a longer period within which
to approve these proposals, disapprove
the proposals, or institute proceedings
to determine whether to disapprove the
proposals.11 The NYSE American
Proposal was published for comment in
the Federal Register on February 29,
2024.12 On April 8, 2024, pursuant to
Section 19(b)(2) of the Act,13 the
Commission designated a longer period
within which to approve the proposal,
disapprove the proposal, or institute
proceedings to determine whether to
disapprove the NYSE American
Proposal.14 On March 25, 2024, the BOX
Proposal 15 and the ISE Trust Proposal 16
were published for comment in the
Federal Register. The Commission
received comments addressing the BOX
Proposal,17 the Cboe Options
filed Jan. 12, 2024; SR–PEARL–2024–03 (‘‘MIAX
Pearl Proposal’’), filed Jan. 12, 2024.
5 See File No. SR–NYSEAMER–2024–10 (‘‘NYSE
American Proposal’’), filed Feb. 9, 2024.
6 See Securities Exchange Act Release Nos. 99395
(Jan. 19, 2024), 89 FR 5075.
7 See. Securities Exchange Act Release No. 99396
(Jan. 19, 2024), 89 FR 5047.
8 See Securities Exchange Act Release No. 99397
(Jan. 19, 2024), 89 FR 5079.
9 See Securities Exchange Act Release No. 99394
(Jan. 19, 2024), 89 FR 5058.
10 15 U.S.C. 78s(b)(2).
11 See Securities Exchange Act Release Nos.
99680 (Mar. 6, 2024), 89 FR 17887 (Mar. 12, 2024)
(Cboe Options Proposal); 99682 (Mar. 6, 2024), 89
FR 17887 (Mar. 12, 2024) (MIAX Pearl Proposal);
99684 (Mar. 6, 2024), 89 FR 17887 (Mar. 12, 2024)
(MIAX Proposal); 99681 (Mar. 6, 2024), 89 FR 17886
(Mar. 12, 2024) (ISE iShares Proposal). The
Commission designated April 24, 2024, as the date
by which the Commission shall approve or
disapprove, or institute proceedings to determine
whether to approve or disapprove, the proposed
rule changes.
12 See Securities Exchange Act Release No. 99593
(Feb. 23, 2024), 89 FR 14911.
13 15 U.S.C. 78s(b)(2).
14 See Securities Exchange Act Release No. 99921
(Apr. 8, 2024), 89 FR 25908 (Apr. 12, 2024).
15 See Securities Exchange Act Release No. 99777
(Mar. 19, 2024), 89 FR 20712.
16 See Securities Exchange Act Release No. 99776
(Mar. 19, 2024), 89 FR 20717.
17 Comment letters on the proposed rule change
are available at https://www.sec.gov/comments/srbox-2024-07/srbox202407.htm.
E:\FR\FM\25JYN1.SGM
25JYN1
]]>Agencies
[Federal Register Volume 89, Number 143 (Thursday, July 25, 2024)]
[Notices]
[Pages 60479-60482]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-16299]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-100563; File No. SR-ISE-2024-28]
[Self-Regulatory Organizations; Nasdaq ISE, LLC; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change To Expand its Co-
Location Services
DATES: July 19, 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 July 5, 2024, Nasdaq ISE, LLC (``ISE'' or ``Exchange'') filed with
the Securities
[[Page 60480]]
and Exchange Commission (``SEC'' or ``Commission'') the proposed rule
change as described in Items I, II, and III, below, which Items have
been prepared by the Exchange. The Commission is publishing this notice
to solicit comments on the proposed rule change from interested
persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange proposes to expand its co-location services.
The text of the proposed rule change is available on the Exchange's
website at https://listingcenter.nasdaq.com/rulebook/ise/rules, at the
principal office of the Exchange, 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 Exchange proposes to expand its co-location services by
offering new cabinet, power, and power distribution unit options in the
Exchange's expanded data center.
The Exchange's current data center (``NY11'') in Carteret, NJ is
undergoing an expansion (``NY11-4'') in response to demand for power
and cabinets. NY11-4 is not a new or distinct co-location facility.
Instead, NY11-4 is simply an expansion of the existing NY11 data
center,\3\ and the Exchange intends to operate it generally in the same
manner as existing aspects of NY11.\4\ Client connections to the
matching engine will be equal across the board, within and among NY11
and NY11-4.
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\3\ NY11-4 is not a standalone facility. Equinix considers the
site as NY11 with three expansions: NY11-2, NY11-3, and NY11-4.
\4\ One aspect of the data center that will be treated
differently in NY11-4 as compared to NY11 at its outset is
telecommunications access and inter-client connectivity. In NY11-4,
connections between colocated client cabinets and the carrier cage
will be of equal length. Inter-client connectivity will also be
equalized in NY11-4. The Exchange believes that equalizing
telecommunications access and inter-client connectivity in NY11-4
will provide a fair solution and avoid market disruption by avoiding
both a race for real estate adjacent to NY11-4 and for particular
space in NY11-4. The Exchange believes that these actions would
facilitate a fair and orderly market and protect investors and the
public interest, consistent with its obligations under the Act.
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The Exchange submits this filing to propose offering new services
in NY11-4, as described below, and to the extent the Exchange offers
additional new services, whether in the existing NY11 data halls or in
the new NY11-4 data hall, the Exchange will submit additional filings
with the Commission.
NY11-4 Expanded Cabinet Optionality: Ultra High Density Cabinet
Currently, co-location customers have the option of obtaining
cabinets of various sizes and power densities. Co-location customers
may obtain a Half Cabinet,\5\ a Low Density Cabinet with power density
less than or equal to 2.88 kilowatts (``kW''), a Medium Density Cabinet
with power density greater than 2.88 kW and less than or equal to 5 kW,
a Medium-High Density Cabinet with power density greater than 5 kW and
less than or equal to 7 kW, a High Density Cabinet with power density
greater than 7 kW and less than 10 kW, and a Super High Density Cabinet
with power density greater than 10 kW and less than or equal to 17.3
kW.
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\5\ Half cabinets are not available to new subscribers. See
General 8, Section 1(a).
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The Exchange proposes to introduce a new cabinet choice in NY11-4,
an ``Ultra High Density Cabinet,'' with power density greater than 10
kW and less than or equal to 15 kW. Based on demand, the Exchange
wishes to introduce the Ultra High Density Cabinet as an option for
customers between the High Density Cabinet and the Super High Density
Cabinet. The Ultra High Density Cabinet option would only be offered in
NY11-4 because of the power configuration necessary for such cabinets,
which is not possible or available in other portions of the data center
due to different power distribution. Because of the addition of the
Ultra High Density Cabinet option in NY11-4, the Super High Density
Cabinet in NY11-4 would have power density greater than 15 kW and less
than or equal to 17.3 kW.
In addition to the Ultra High Density Cabinet, the Exchange would
offer the other, existing cabinet options in NY11-4, with the exception
of the Low Density Cabinet and Half Cabinet due to a lack of demand for
such cabinets. The cabinets in NY11-4 will include certain features,
including but not limited to: uniform, wider cabinets \6\ (32'' W x
48'' D x 91'' H), cable management, and a rear split door and combo
lock.
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\6\ In the existing data halls, clients may bring their own
cabinets or use Exchange-provided cabinets. Because of the cooling
system in NY11-4 (hot aisle containment), all cabinets must be
uniform and therefore, the Exchange will provide all cabinets. The
existing data halls utilize cold aisle containment to manage
temperatures. Hot aisle containment is a more effective way to
manage heat in the data center.
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NY11-4 Cabinet Power and Power Distribution Units
The Exchange currently provides various cabinet power options,
including: 2x20 amp 110 volt, 2x30 amp 110 volt, 2x20 amp 208 volt,
2x30 amp 208 volt, Phase 3 2x 20 amp 208 volt, Phase 3 2x 30 amp 208
volt, 2x60 amp 208 volt, Phase 3 2x 40 amp 208 volt, Phase 3 2x 50 amp
208 volt, Phase 3 2x 60 amp 208 volt, and 2x30 amp 48 volt DC. For
NY11-4, the data center operator is bringing in higher voltage power
options, which are more consistent with power options used in other
data centers across the globe. The Exchange proposes to amend General
8, Section 1(c) to add the cabinet power options for NY11-4, which
include: Phase 1 20 amp 240 volt, Phase 1 32 amp 240 volt, Phase 1 40
amp 240 volt, Phase 3 20 amp 415 volt, and Phase 3 32 amp 415 volt. The
Exchange also proposes to specify in its Rules that these cabinet power
options are specific to NY11-4 and that one of these options must be
selected for cabinets in NY11-4. Although different cabinet power
options will be offered in NY11 and NY11-4 due to differing power
configurations, the new cabinet power options are not inherently
preferable to the existing cabinet power options and the Exchange does
not anticipate material differences in equipment performance based on
the power distribution.\7\ Due to higher voltage options being offered
in NY11-4, the data center operator is likely to experience increased
power distribution efficiencies across the data center. As between the
various cabinet power options, customers choose power based on their
preference and capacity needs.
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\7\ Customers in NY11-4 will receive comparable power draw/
consumption as compared to NY11. Any differences between
efficiencies in the customer equipment are negligible.
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The Exchange also proposes to offer power distribution units
(``PDUs'') \8\ in NY11-4 as a convenience to customers. Rather than
sourcing PDUs on a customer-by-customer basis, as the Exchange does for
customers in NY11,
[[Page 60481]]
the Exchange wishes to simplify and standardize its PDU offering in
NY11-4 by offering Phase 1 and Phase 3 \9\ power distribution units.
This service is optional and customers may choose to provide their own
PDUs appropriate for their power installation choices. The Exchange
also proposes to offer a switch monitored PDU add on in NY11-4, which
would allow customers to connect remotely to their PDU and control the
power sockets. With the switch monitored PDU option, customers would be
able to power cycle or shut off power remotely. This option is optional
as well and customers may choose to provide their own switch monitored
PDU, if desired.
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\8\ PDUs are devices fitted with multiple outputs designed to
distribute electric power. The standardized PDUs would only be
offered for NY11-4.
\9\ Phase 1 PDUs would be compatible with the following power
options: Phase 1 20 amp 240 volt, Phase 1 32 amp 240 volt, and Phase
1 40 amp 240 volt. Phase 3 PDUs would be compatible with the
following power options: Phase 3 20 amp 415 volt and Phase 3 32 amp
415 volt. Phase 1 and Phase 3 are available in NY11 and NY11-4.
Phase 3 PDUs provide greater power density than Phase 1 PDUs by
delivering power over three wires as opposed to one wire.
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Implementation
Although the timing is subject to change,\10\ the Exchange
anticipates opening NY11-4 Exchange access on October 21, 2024 and
providing customers access to the space on or after August 5, 2024. In
concert with this filing, the Exchange will allow customers to place
orders for NY11-4, which would not be fee liable until customers are
provided access to the space.\11\ The Exchange will submit a fee filing
to establish fees for the services described herein. Allowing customers
to place orders in advance of opening its doors will allow the Exchange
to plan ahead for capacity and demand for services, as well as procure
necessary equipment.
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\10\ The Exchange will announce modifications to the proposed
timing via the Nasdaq Customer Portal, which is the web portal used
for order and inventory management of colocation services, and email
communication to all colocation customers.
\11\ Charging customers once access is provided is consistent
with current practice and allows customers to set up equipment and
begin using power.
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2. Statutory Basis
The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\12\ in general, and furthers the objectives of Section
6(b)(5) of the Act,\13\ in particular, in that it is designed to
promote just and equitable principles of trade, 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. Today, the Exchange offers various cabinet choices and power
options in the data center for colocation customers. The proposal would
expand the cabinet and power options available, by introducing an
additional cabinet option, the Ultra High Density Cabinet, and new
power choices. The proposal would benefit the public interest by
providing customers more cabinet and power options to choose from,
thereby enhancing their ability to tailor their colocation operations
to the requirements of their business operations. In general, the
proposal is consistent with the Act because the Exchange's expansion of
the data center and expansion of available power and cabinets will
enable the Exchange to meet customer needs and address demand for both
cabinets and power. In lieu of collocating directly with the Exchange,
market participants may choose not to collocate at all or to collocate
indirectly through a vendor.
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\12\ 15 U.S.C. 78f(b).
\13\ 15 U.S.C. 78f(b)(5).
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The Exchange also believes that the proposal will not be unfairly
discriminatory, consistent with the objectives of Section 6(b)(5) of
the Act \14\ because the expanded cabinet and power options in the data
center would be offered equally to all customers. Although certain
optionality is only offered in NY11-4 because of different power
configurations in NY11-4 as compared to NY11, NY11-4 is merely an
expansion of the data center, and any customer may order cabinets and
power in NY11-4 (and across the data center broadly) on the same terms
as any other customer.
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\14\ Id.
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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 not necessary or appropriate in
furtherance of the purposes of the Act.
Nothing in the proposal imposes any burden on the ability of other
exchanges to compete. The Exchange operates in a highly competitive
market in which exchanges and other vendors offer colocation services
as a means to facilitate the trading and other market activities of
those market participants who believe that colocation enhances the
efficiency of their operations. As part of its colocation offering, the
Exchange currently offers similar cabinets and power, as do other
exchanges.
Nothing in the Proposal burdens intra-market competition because
the Exchange's colocation services, including those proposed herein,
are available to any customer and customers that wish to order cabinets
and power can do so on a non-discriminatory basis. Use of any
colocation service is completely voluntary, and each market participant
is able to determine whether to use colocation services based on the
requirements of its business operations.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were either solicited or received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing 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 for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A)(iii) of the Act \15\ and
subparagraph (f)(6) of Rule 19b-4 thereunder.\16\
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\15\ 15 U.S.C. 78s(b)(3)(A)(iii).
\16\ 17 CFR 240.19b-4(f)(6). 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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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. If the Commission
takes such action, the Commission shall institute proceedings to
determine whether the proposed rule 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 [email protected]. Please include
file number SR-ISE-2024-28 on the subject line.
[[Page 60482]]
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-ISE-2024-28. 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-ISE-2024-28 and should be
submitted on or before August 15, 2024.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\17\
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\17\ 17 CFR 200.30-3(a)(12).
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J. Matthew DeLesDernier,
Deputy Secretary.
[FR Doc. 2024-16299 Filed 7-24-24; 8:45 am]
BILLING CODE 8011-01-P
