Self-Regulatory Organizations; Notice of Filing of a Proposed Rule Change, as Modified by Partial Amendment Nos. 1 and 2, by MIAX PEARL, LLC To Amend Exchange Rule 402, Criteria for Underlying Securities, To List and Trade Options on Commodity-Based Trust Shares, 12876-12881 [2025-04512]

Download as PDF 12876 Federal Register / Vol. 90, No. 52 / Wednesday, March 19, 2025 / Notices Simpson Thacher & Bartlett LLP, 900 G Street NW, Washington, DC 20001. FOR FURTHER INFORMATION CONTACT: Laura J. Riegel, Senior Counsel, or Thomas Ahmadifar, Branch Chief, at (202) 551–6825 (Division of Investment Management, Chief Counsel’s Office). SUPPLEMENTARY INFORMATION: For Applicants’ representations, legal analysis, and conditions, please refer to Applicants’ Second Amended and Restated Application, dated March 14, 2025, which may be obtained via the Commission’s website by searching for the file number at the top of this document, or for an Applicant using the Company name search field, on the SEC’s EDGAR system. The SEC’s EDGAR system may be searched at, https://www.sec.gov/edgar/searchedgar/ companysearch. You may also call the SEC’s Office of Investor Education and Advocacy at (202) 551–8090. For the Commission, by the Division of Investment Management, under delegated authority. Vanessa A. Countryman, Secretary. [FR Doc. 2025–04647 Filed 3–18–25; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–102659; File No. SR– PEARL–2025–08] Self-Regulatory Organizations; Notice of Filing of a Proposed Rule Change, as Modified by Partial Amendment Nos. 1 and 2, by MIAX PEARL, LLC To Amend Exchange Rule 402, Criteria for Underlying Securities, To List and Trade Options on Commodity-Based Trust Shares March 13, 2025. lotter on DSK11XQN23PROD with NOTICES1 Pursuant to the provisions of 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 March 5, 2025, MIAX PEARL, LLC (‘‘MIAX Pearl’’ or the ‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’) a proposed rule change as described in Items I, II, and III below, which Items have been substantially prepared by the Exchange.3 The Commission is 1 15 U.S.C. 78s(b)(1). CFR 240.19b–4. 3 On March 11, 2025, the Exchange filed Partial Amendment No. 1 to the proposed rule change. In addition to the changes described herein, Partial Amendment No. 1 corrected a marking error in proposed changes to the rule text in Exhibit 5 and corrected the header of the Exhibit 1. On March 12, 2025, the Exchange filed Partial Amendment No. 2 2 17 VerDate Sep<11>2014 18:11 Mar 18, 2025 Jkt 265001 publishing this notice to solicit comments on the proposed rule change, as modified by Partial Amendments Nos. 1 and 2, from interested persons. I. Self-Regulatory Organization’s Statement of the Terms of Substance of the Proposed Rule Change The Exchange proposes to amend Exchange Rule 402, Criteria for Underlying Securities, to list and trade options on Commodity-Based Trust Shares. The text of the proposed rule change is available on the Exchange’s website at https://www.miaxglobal.com/markets/ us-equities/pearl-equities/rule-filings, at MIAX Pearl’s principal office, 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, MIAX Pearl 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. MIAX Pearl 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 amend Exchange Rule 402, Criteria for Underlying Securities,4 to allow the listing and trading of options on units that represent interests in a trust that in a Commodity-Based Trust. This is a competitive filing substantively identical to proposals submitted by Nasdaq ISE, LLC (‘‘ISE’’), NYSE American, LLC (‘‘NYSE American’’), NYSE Arca Inc. (‘‘NYSE Arca’’) and Cboe Exchange, Inc. (‘‘Cboe’’), which are currently pending with the Securities to the proposed rule change to correct a marking error in proposed changes to the rule text in Exhibit 5 as modified by Partial Amendment No. 1. 4 The Exchange notes that its affiliate options exchanges, Miami International Securities Exchange, LLC (‘‘MIAX ’’) and MIAX Sapphire, LLC (‘‘MIAX Sapphire’’), submitted (or will submit) substantively similar proposals. The Exchange notes that the rules of Chapter IV of MIAX, including Exchange Rule 402, are incorporated by reference into the MIAX Emerald, LLC (‘‘MIAX Emerald’’) rulebook. PO 00000 Frm 00181 Fmt 4703 Sfmt 4703 and Exchange Commission (the ‘‘Commission’’).5 The Exchange proposes to allow the listing and trading of options on units that represent interests in a trust that in a Commodity-Based Trust. A Commodity-Based Trust is defined at The Nasdaq Stock Market LLC Rule 5711(d)(iv), NYSE Arca Rule 8.201(c), and Cboe BZX Exchange, Inc. 14.11(e)(4) as a security that is issued by a trust that holds (i) a specified commodity deposited with the Trust, or (ii) 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 (‘‘Commodity-Based Trust Share’’). The Exchange proposes to amend Exchange Rule 402(i) to provide that (i) Securities deemed appropriate for options trading shall include shares or other securities (‘‘Exchange-Traded Fund Shares’’) that are traded on a national securities exchange and are defined as an ‘‘NMS stock’’ under Rule 600 of Regulation NMS, and that . . . (4) represent interests in (i) a security issued by a trust that holds (A) a specified commodity deposited with the trust, or (B) a specified commodity and, in addition to such specified commodity, cash; (ii) 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 (iii) 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 (‘‘Commodity-Based Trust Share’’).6 The Exchange proposes to insert this rule text and remove references to the SPDR® Gold Trust, the iShares COMEX Gold Trust, the iShares Silver Trust, the Aberdeen Standard Silver ETF Trust, the Aberdeen Standard Physical Gold Trust, the Aberdeen Standard Palladium ETF Trust, the Aberdeen Standard Platinum ETF Trust, the Goldman Sachs Physical Gold ETF, the Sprott Physical Gold Trust, the iShares Bitcoin Trust, the Grayscale Bitcoin Trust, the Grayscale Bitcoin Mini Trust, the 5 See Securities Exchange Act Release No. 102465 (February 20, 2025) (SR–ISE–2025–08); SRNYSEArca–2025–16 (February 24, 2025); and SR–NYSEAmerican–2025–07 (February 24, 2025) and SR–CBOE–2025–014. Partial Amendment No. 1 added the citation to SR–CBOE–2025–014. 6 Partial Amendment No. 1 removed text incorrectly included in the block quote describing proposed Exchange Rule 402(i). E:\FR\FM\19MRN1.SGM 19MRN1 Federal Register / Vol. 90, No. 52 / Wednesday, March 19, 2025 / Notices lotter on DSK11XQN23PROD with NOTICES1 Bitwise Bitcoin ETF, the Fidelity Wise Origin Bitcoin Fund, and the ARK 21 Shares Bitcoin ETF which are all Commodity-Based Trust Shares. As a result of this proposed rule change, the Exchange’s listing criteria would allow any ETF approved to list on a primary equities market as a Commodity-Based Trust Share to qualify as an underlying for options traded on the Exchange, provided other listing criteria have been met.7 The Exchange’s initial listing standards as set forth in Exchange Rule 402(a) for Exchange Traded Fund Shares (‘‘ETFs’’) on which options may be listed and traded on the Exchange, will continue to apply. Pursuant to Exchange Rule 402(a), a security (which includes ETFs) on which options may be listed and traded on the Exchange must be a security registered (with the Commission) and be an NMS stock (as defined in Rule 600 of Regulation NMS under the Act), and be characterized by a substantial number of outstanding shares that are widely held and actively traded.8 Additionally, Exchange Rule 402(i)(5)(i) requires that the ETFs must either (1) meet the criteria and standards set forth in Exchange Rule 402(a) or 402(b),9 or (2) be available for creation or redemption each business day from or through the issuer in cash or in kind at a price related to net asset value, and the issuer must be obligated to issue ETFs in a specified aggregate number even if some or all of the investment assets required to be deposited have not been received by the issuer, subject to the condition that the person obligated to deposit the investments has undertaken to deliver the investment 7 The Exchange believes this proposal is consistent with the Options Clearing Corporation (‘‘OCC’’) recent amendment of ‘‘Fund Share’’ (which covers ETFs), as defined in OCC’s By-Laws (including the Interpretation and Policy), to remove references to specific precious metal commoditybased ETFs as ‘‘no longer relevant or necessary.’’ See Securities Exchange Act Release No. 102018 (December 20, 2024), 89 FR 106660 (December 30, 2024) (SR–OCC–2024–018). The impetus for this rule change was the staff advisory issued by the Commodity Futures Trading Commission (‘‘CFTC’’) that deemed it ‘‘‘substantially likely’ that spot commodity ETF shares would be held to be securities’’ which, in turn, resulted in the OCC’s determination that ‘‘it no longer needs to seek product-by-product exemptive relief from the CFTC to clear spot commodity-based ETF products, including precious metals commodity-based ETFs.’’ See id. at 106661; see also CFTC Staff Advisory Relating to the Clearing of Options on Spot Commodity Exchange Traded Funds (ETFs), Letter No. 24–16 (Nov. 15, 2024), available at https:// www.cftc.gov/csl/24-16/ download. 8 The criteria and guidelines for a security to be considered widely held and actively traded are set forth in Exchange Rule 402(b). 9 Subparagraphs (a) and (b) of Exchange Rule 402 provide for guidelines to be used by the Exchange when evaluating potential underlying securities for Exchange option transactions. VerDate Sep<11>2014 18:11 Mar 18, 2025 Jkt 265001 assets as soon as possible and such undertaking is secured by the delivery and maintenance of collateral consisting of cash or cash equivalents satisfactory to the issuer, as provided in the respective prospectus. Additionally, a Commodity-Based Trust Share will also be subject to the Exchange’s continued listing standards for options on ETFs set forth in Exchange Rule 403(g) for ETFs deemed appropriate for options trading pursuant to Exchange Rule 402(i). Specifically, options approved for trading pursuant to Exchange Rule 402(i) will not be deemed to meet the requirements for continued approval, and the Exchange shall not open for trading any additional series of option contracts of the class covering such ETFs if the ETFs are delisted from trading as provided in Exchange rule 403(b)(4) or the ETFs are halted or suspended from trading on their primary market. Additionally, options on ETFs may be subject to the suspension of opening transactions in any of the following circumstances: (1) in the case of options covering ETFs approved for trading under Exchange Rule 402(i)(5)(i)(A), in accordance with the terms of paragraphs (b)(1), (2), and (3) of Exchange Rule 403; (2) in the case of options covering ETFs approved for trading under Exchange Rule 402(i)(5)(i)(B), following the initial twelvemonth period beginning upon the commencement of trading in the ETFs on a national securities exchange and are defined as an NMS stock, there are fewer than 50 record and/or beneficial holders of such ETFs for 30 or more consecutive trading days; (3) the value of the index or portfolio of securities, non-U.S. currency, or portfolio of commodities including commodity futures contracts, options on commodity futures contracts, swaps, forward contracts and/or options on physical commodities and/or financial instruments and money market instruments on which the ETFs are based is no longer calculated or available; or (4) such other event shall occur or condition exist that in the opinion of the Exchange makes further dealing in such options on the Exchange inadvisable. The Exchange notes that ETFs that hold financial instruments, money market instruments, precious metal commodities, or cryptocurrencies that are deemed commodities on which the Exchange may already list and trade options pursuant to Exchange Rule 402(i) are trusts structured in substantially the same manner as options on a Commodity Based Trust Share and essentially offer the same objectives and benefits to investors, just with respect to different assets. The Exchange notes that it has not identified any issues with the continued listing and trading of any ETF options, including ETFs that hold commodities PO 00000 Frm 00182 Fmt 4703 Sfmt 4703 12877 (e.g., precious metals, cryptocurrencies) that it currently lists and trades on the Exchange. Options on a Commodity-Based Fund Share will be physically settled contracts with American-style exercise.10 Consistent with Exchange Rule 404, which governs the opening of options series on a specific underlying security (including ETFs), the Exchange will open at least one expiration month for options on a Commodity-Based Trust Share 11 and may also list series of options on Commodity-Based Trust Share for trading on a weekly,12 monthly,13 or quarterly 14 basis. The Exchange may also list long-term equity option series (‘‘LEAPS’’) that expire from 12 to 39 months from the time they are listed.15 Pursuant to Exchange Rule 404, Interpretations and Policies.06, which governs strike prices of series of options on ETFs, the interval between strike prices of series of options on ETFs approved for options trading pursuant to Exchange Rule 402(i) shall be fixed at a price per share which is reasonably close to the price per share at which the underlying security is traded in the primary market at or about the same 10 See Exchange Rule 401, which provides that the rights and obligations of holders and writers are set forth in the Rules of the Options Clearing Corporation (‘‘OCC’’); see also OCC Rules, Chapters VIII (which governs exercise and assignment) and Chapter IX (which governs the discharge of delivery and payment obligations arising out of the exercise of physically settled stock option contracts). 11 See Exchange Rule 404(b). The monthly expirations are subject to certain listing criteria for underlying securities described within Exchange Rule 404 and its Interpretations and Policies. Monthly listings expire the third Friday of the month. The term ‘‘expiration date’’ (unless separately defined elsewhere in the OCC By-Laws), when used in respect of an option contract (subject to certain exceptions), means the third Friday of the expiration month of such option contract, or if such Friday is a day on which the exchange on which such option is listed is not open for business, the preceding day on which such exchange is open for business. See OCC By-Laws Article I, Section 1. Pursuant to Exchange Rule 404(c), additional series of options of the same class may be opened for trading on the Exchange when the Exchange deems it necessary to maintain an orderly market, to meet customer demand or when the market price of the underlying stock moves more than five strike prices from the initial exercise price or prices. Pursuant to Exchange Rule 404(e), new series of options on an individual stock may be added until the beginning of the month in which the options contract will expire. Due to unusual market conditions, the Exchange, in its discretion, may add a new series of options on an individual stock until the close of trading on the business day prior to expiration. 12 See Exchange Rule 404, Interpretations and Policies .02. 13 See Exchange Rule 404, Interpretations and Policies .13. 14 See Exchange Rule 404, Interpretations and Policies .03. 15 See Exchange Rule 406. Partial Amendment No. 1 corrected this rule citation. E:\FR\FM\19MRN1.SGM 19MRN1 12878 Federal Register / Vol. 90, No. 52 / Wednesday, March 19, 2025 / Notices lotter on DSK11XQN23PROD with NOTICES1 time such series of options is first open for trading on the Exchange, or at such intervals as may have been established on another options exchange prior to the initiation of trading on the Exchange. With respect to the Short Term Options Series or Weekly Program, during the month prior to expiration of an option class that is selected for the Short Term Option Series Program, the strike price intervals for the related non-Short Term Option (‘‘Related non-Short Term Option’’) shall be the same as the strike price intervals for the Short Term Option.16 Specifically, the Exchange may open for trading Short Term Option Series at strike price intervals of (i) $0.50 or greater where the strike price is less than $100, and $1 or greater where the strike price is between $100 and $150 for all option classes that participate in the Short Term Options Series Program; (ii) $0.50 for option classes that trade in one dollar increments and are in the Short Term Option Series Program; or (iii) $2.50 or greater where the strike price is above $150.17 Additionally, the Exchange may list series of options pursuant to the $1 Strike Price Interval Program,18 the $0.50 Strike Program,19 and the $2.50 Strike Price Program.20 Pursuant to Exchange Rule 510, where the price of a series of options on a CommodityBased Trust Share is less than $3.00, the minimum increment will be $0.05, and where the price is $3.00 or higher, the minimum increment will be $0.10 21 consistent with the minimum increments for options on other ETFs listed on the Exchange. Any and all new series of a Commodity-Based Trust Share options that the Exchange lists will be consistent and comply with the expirations, strike prices, and minimum increments set forth in Rules 404 and 510, as applicable. Options on a Commodity-Based Trust Share will trade in the same manner as options on other ETFs on the Exchange. The Exchange Rules that currently apply to the listing and trading of all options on ETFs on the Exchange, including, for example, Rules that govern listing criteria, expirations, exercise prices, minimum increments, position and exercise limits, margin requirements, customer accounts and trading halt procedures would apply to the listing and trading of options on a 16 See Exchange Rule 404, Interpretations and Policies .02(e). 17 Id. 18 See Exchange Rule 404, Interpretations and Policies.01. 19 See Exchange Rule 404, Interpretations and Policies.04. 20 See Exchange Rule 404(f). 21 See Exchange Rule 510. VerDate Sep<11>2014 18:11 Mar 18, 2025 Jkt 265001 Commodity-Based Trust Share on the Exchange in the same manner as they apply to other options on all other ETFs that are listed and traded on the Exchange. Position and exercise limits for options on ETFs, including options on a Commodity-Based Trust Share, are determined pursuant to the Exchange’s affiliate MIAX Rules 307 and 309, respectively. Position and exercise limits for ETF options vary according to the number of outstanding shares and the trading volumes of the underlying ETF over the past six months, where the largest in capitalization and the most frequently traded ETFs have an option position and exercise limits of 250,000 contracts (with adjustments for splits, re-capitalizations, etc.) on the same side of the market; and smaller capitalization ETFs have position and exercise limits of 200,000, 75,000, 50,000 or 25,000 contracts (with adjustments for splits, re-capitalizations, etc.) on the same side of the market. The Exchange further notes that the Exchange’s affiliate MIAX Rule 1502, which governs margin requirements applicable to trading on the Exchange, including options on ETFs, will also apply to the trading on a Commodity-Based Trust Share options. The Exchange represents that the same surveillance procedures applicable to all other options on other ETFs currently listed and traded on the Exchange will apply to options on a Commodity Based Trust Share that it applies to the Exchange’s other options products.22 The Exchange believes that its existing surveillance and reporting safeguards are designed to deter and detect possible manipulative behavior which might potentially arise from listing and trading options on ETFs, including any options on a CommodityBased Trust Share. Additionally, the Exchange is a member of the Intermarket Surveillance Group (‘‘ISG’’) under the Intermarket Surveillance Group Agreement. ISG members work together to coordinate surveillance and investigative information sharing in the stock, options, and futures markets. In addition, the Exchange has a Regulatory Services Agreement with the Financial Industry Regulatory Authority (‘‘FINRA’’). Pursuant to a multi-party 17d–2 joint plan, all options exchanges allocate regulatory responsibilities to FINRA to conduct certain optionsrelated market surveillance that are common to rules of all options 22 The surveillance program includes real-time patterns for price and volume movements and posttrade surveillance patterns (e.g., spoofing, marking the close, pinging, phishing). PO 00000 Frm 00183 Fmt 4703 Sfmt 4703 exchanges.23 Also, the Exchange may obtain information from CME Group Inc.’s designated contract markets that are members of the ISG related to a financial instrument that is based, in whole or in part, upon an interest in or performance of a commodity, as applicable. Further, the Exchange will implement any new surveillance procedures it deems necessary to effectively monitor the trading of options on Commodity-Based Fund Shares. The Exchange has also analyzed its capacity and represents that it believes the Exchange and the Options Price Reporting Authority (‘‘OPRA’’) have the necessary systems capacity to handle the additional traffic associated with the listing of new series of ETFs, including options on a Commodity-Based Trust Share, up to the number of expirations currently permissible under the Exchange Rules. The Exchange believes any additional traffic generated from the trading of options on Commodity-Based Trust Shares would be manageable. The Exchange represents that Exchange members will not have a capacity issue as a result of this proposed rule change. Further, quotation and last sale information for Commodity-Based Trust Shares is available via the Consolidated Tape Association (‘‘CTA’’) high speed line. Quotation and last sale information for such securities is also available from the exchange on which such securities are listed. Quotation and last sale information for options on CommodityBased Trust Shares will be available via OPRA and major market data vendors. The Exchange notes that the Commission has previously approved generic listing standards pursuant to Rule 19b–4(e) of the Act 24 for ETFs based on indexes that consist of stocks listed on U.S. exchanges.25 In addition, 23 Section 19(g)(1) of the Act, among other things, requires every SRO registered as a national securities exchange or national securities association to comply with the Act, the rules and regulations thereunder, and the SRO’s own rules, and, absent reasonable justification or excuse, enforce compliance by its members and persons associated with its members. See 15 U.S.C. 78q(d)(1) and 17 CFR 240.17d–2. Section 17(d)(1) of the Act allows the Commission to relieve an SRO of certain responsibilities with respect to members of the SRO who are also members of another SRO (‘‘common members’’). Specifically, Section 17(d)(1) allows the Commission to relieve an SRO of its responsibilities to: (i) receive regulatory reports from such members; (ii) examine such members for compliance with the Act and the rules and regulations thereunder, and the rules of the SRO; or (iii) carry out other specified regulatory responsibilities with respect to such members. 24 17 CFR 240.19b–4(e). 25 See Securities Exchange Act Release No. 54739 (November 9, 2006), 71 FR 66993 (November 17, 2006) (SR–AMEX–2006–78) (approval order relating to generic listing standards for ETFs based on international or global indexes). E:\FR\FM\19MRN1.SGM 19MRN1 Federal Register / Vol. 90, No. 52 / Wednesday, March 19, 2025 / Notices the Commission has previously approved proposals for the listing and trading of options on ETFs based on international indexes as well as global indexes (e.g., based on non-U.S. and U.S. component stocks).26 In approving Commodity-Based Trust Shares for equities exchange trading, the Commission thoroughly considered the structure of the Commodity-Based Trust Shares, their usefulness to investors and to the markets, and self-regulatory organization rules that govern their trading. The Exchange believes that allowing the listing of options overlying Commodity-Based Trust Shares that are listed pursuant to Commission approval on equities exchanges and applying Rule 19b–4(e) 27 should fulfill the intended objective of that rule by allowing options on those CommodityBased Trust Shares that have satisfied the generic listing standards to commence trading, without the need for the public comment period and Commission approval. The proposed rule change has the potential to significantly reduce the time and costs associated with bringing options on Commodity-Based Trust Shares to market, thereby reducing the burden on issuers and other market participants, while also promoting competition among options exchanges, to the benefit of the investing public. The failure of a particular Commodity-Based Trust Share to comply with the generic listing standards under Rule 19b–4(e) 28 would not, however, preclude the Exchange from submitting a separate filing pursuant to Section 19(b)(2) 29 requesting Commission approval to list and trade options on a particular Commodity-Based Trust Share. 2. Statutory Basis lotter on DSK11XQN23PROD with NOTICES1 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 26 See, e.g., Securities Exchange Act Release Nos. 56778 (November 9, 2007), 72 FR 65113 (November 19, 2007) (SR–AMEX–2007–100) (approval order to list and trade options on iShares MSCI Mexico Index Fund); and 55648 (April 19, 2007), 72 FR 20902 (April 26, 2007) (SR–AMEX–2007–09) (approval order to list and trade options on Vanguard Emerging Markets ETF); see also Securities Exchange Act Release Nos. 50189 (August 12, 2004), 69 FR 51723 (August 20, 2004) (SR–AMEX–2001–05) (approving the listing and trading of certain Vanguard International Equity Index Funds); and 44700 (August 14, 2001), 66 FR 43927 (August 21, 2001) (SR–2001–34)(approving the listing and trading of series of the iShares Trust based on foreign stock indexes). 27 17 CFR 240.19b–4(e). 28 Id. 29 15 U.S.C. 78s(b)(2). VerDate Sep<11>2014 18:11 Mar 18, 2025 Jkt 265001 Section 6(b) of the Act.30 Specifically, the Exchange believes the proposed rule change is consistent with the Section 6(b)(5) 31 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. Additionally, the Exchange believes the proposed rule change is consistent with the Section 6(b)(5) 32 requirement that the rules of an exchange not be designed to permit unfair discrimination between customers, issuers, brokers, or dealers. In particular, the Exchange believes that the proposal will remove impediments to and perfect the mechanism of a free and open market and a national market system and, in general, protect investors because it would allow the Exchange to immediately list and trade options on any Commodity-Based Trust Share, provided the initial listing criteria has been met, without any additional approvals from the Commission.33 Commodity-Based Trust Shares are securities approved for trading by the Commission. The Exchange believes that with this proposal it will be able to offer options on a Commodity-Based Trust Share soon after the listing of such underlying security in the primary market, provided the initial listing criteria has been met, thereby availing market participants of the opportunity to hedge their positions in the ETF in a timely manner. Given the potential to reduce the time to market for options on Commodity-Based Trust Shares, the proposed rule change will also reduce the burdens on issuers and other market participants, while also promoting competition among options exchanges to the benefit of the investing public. This proposal would permit options on Commodity-Based Trust Shares to be listed on the Exchange in the same manner as all other securities that are subject to the current listing criteria in Exchange Rule 402. The Exchange notes 30 15 31 15 U.S.C. 78f(b). U.S.C. 78f(b)(5). 32 Id. 33 As noted herein, the Exchange believes this proposal is consistent with the OCC’s determination that, based on a staff advisory from the CFTC, the ‘‘it no longer needs to seek product-by-product exemptive relief from the CFTC to clear spot commodity-based ETF products.’’ See supra note 7. PO 00000 Frm 00184 Fmt 4703 Sfmt 4703 12879 that the majority of ETFs are able to list and trade options once the initial listing criteria have been met without the need for additional approvals. The proposed rule change would allow options on a Commodity-Based Trust Share to likewise list and trade options once the initial listing criteria have been met without the need for additional approvals. Accordingly, the proposed rule change would align the treatment of Commodity-Based Trust Shares with other ETFs for purposes of options trading, which would add internal consistency to Exchange rules. The Exchange believes that the proposed rule change will facilitate the listing and trading of options on additional ETFs that will enhance competition among market participants, to the benefit of investors and the marketplace. Like options on any other securities, options on Commodity-Based Trust Shares provides investors with the ability to hedge exposure to the underlying security similar to options on any other securities. Options on Commodity-Based Trust Shares benefits investors, similar to the listing of any other option on an ETF, by providing investors with a relatively lower-cost risk management tool, to manage their positions and associated risk in their portfolios more easily in connection with exposure to the price of a commodity. Additionally, options on a Commodity-Based Trust Share provide investors with the ability to transact in such options in a listed market environment as opposed to in the unregulated OTC options market, which increases market transparency and enhances the process of price discovery conducted on the Exchange through increased order flow to the benefit of all investors. The Exchange also notes that it already lists options on other commodity based ETFs,34 which, as described above, are trusts structured as Commodity-Based Trust Shares. The Exchange has not identified any issues with the continued listing and trading of options on Commodity-Based Trust Shares it currently lists for trading. The Exchange also believes the proposed rule change will remove impediments to and perfect the mechanism of a free and open market and a national market system, because it is consistent with current Exchange Rules, previously filed with the Commission. Options on a CommodityBased Trust Share must satisfy the initial listing standards and continued listing standards currently in the Exchange Rules applicable to options on 34 See E:\FR\FM\19MRN1.SGM Exchange Rule 402(i)(4). 19MRN1 12880 Federal Register / Vol. 90, No. 52 / Wednesday, March 19, 2025 / Notices lotter on DSK11XQN23PROD with NOTICES1 all ETFs, including ETFs that hold other commodities already deemed appropriate for options trading on the Exchange.35 Options on a CommodityBased Trust Share would trade in the same manner as any other ETF options—the same Exchange Rules that currently govern the listing and trading of all ETF options, including permissible expirations, strike prices and minimum increments, and applicable position and exercise limits and margin requirements, will govern the listing and trading of options on a Commodity-Based Trust Share in the same manner. The Exchange believes the proposed rule change will result in increased competition as other exchanges will likely adopt an identical rule to the one proposed by the Exchange that would allow the listing and trading of options on Commodity-Based Trust Shares that are approved for trading on those other markets.36 Multiple listing of ETFs, options and other securities and competition are some of the central features of the national market system. The Exchange believes that the proposal would encourage a more open market and national market system based on competition and multiple listing. The Exchange represents that it has the necessary systems capacity to support the listing and trading of options on Commodity-Based Trust Shares as the Exchange lists these products today, except that it requires additional approvals prior to listing. The Exchange believes that its existing surveillance and reporting safeguards are designed to deter and detect possible manipulative behavior which might arise from listing and trading of these ETF options.37 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. In this regard and as indicated above, the Exchange notes that the rule change is being proposed as a competitive response to the filings submitted by ISE, NYSE American, NYSE Arca, and Cboe.38 The Exchange believes that the proposal is pro-competitive and is a competitive response to the Exchange’s inability to list options on CommodityBased Trust Shares without the need for 35 Id. 36 See supra note 5. Amendment No. 1 removed a duplicative sentence from the beginning of this paragraph. 38 See supra note 5. 37 Partial VerDate Sep<11>2014 18:11 Mar 18, 2025 Jkt 265001 additional approvals. The Exchange believes the proposed rule change will result in additional investment options and opportunities to achieve the investment objectives of market participants seeking efficient trading and hedging vehicles, to the benefit of investors, market participants, and the marketplace in general. Competition is one of the principal features of the national market system. The Exchange believes that this proposal will expand competitive opportunities to list and trade products on the Exchange as noted. The Exchange does not believe the proposal will impose any burden on intra-market competition that is not necessary or appropriate in furtherance of the purposes of the Act because Commodity-Based Trust Shares, like any other ETF, would have to satisfy the Exchange’s initial listing standards to be eligible for options trading. Additionally, the proposed rule change would apply to all market participants in the same manner as options on Commodity-Based Trust Shares will be equally available to all market participants who wish to trade such options. The Exchange does not believe the proposal will impose any burden on inter-market competition that is not necessary or appropriate in furtherance of the purposes of the Act, as nothing prevents the other options exchanges from proposing similar rules to list and trade options on Commodity-Based Trust Shares. As noted herein, ISE, NYSE American, NYSE Arca, and Cboe have submitted a proposal to adopt an identical rule to allow ISE, NYSE American, NYSE Arca, and Cboe list and trade options on Commodity-Based Trust Shares without the need for additional approvals.39 Furthermore, the Exchange notes that listing and trading options on a Commodity-Based Trust Share on the Exchange will subject such options to transparent exchange-based rules as well as price discovery and liquidity, as opposed to alternatively trading such options in the OTC market. The Exchange believes that the proposed rule change may relieve any burden on, or otherwise promote, competition as it is designed to increase competition for order flow on the Exchange in a manner that is beneficial to investors by providing them with a lower-cost option to hedge their investment portfolios in a timely manner. 39 See PO 00000 supra note 5. Frm 00185 Fmt 4703 Sfmt 4703 C. Self-Regulatory Organization’s Statement on Comments on The Proposed Rule Change Received From Members, Participants, or Others Written comments were neither solicited nor received. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action Within 45 days of the date of publication of this notice in the Federal Register or within such longer period up to 90 days (i) as the Commission may designate if it finds such longer period to be appropriate and publishes its reasons for so finding or (ii) as to which the Exchange consents, the Commission will: A. by order approve or disapprove such proposed rule change, or B. institute proceedings to determine whether the proposed rule change should be 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– PEARL–2025–08 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–PEARL–2025–08. 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 E:\FR\FM\19MRN1.SGM 19MRN1 Federal Register / Vol. 90, No. 52 / Wednesday, March 19, 2025 / Notices 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–PEARL–2025–08 and should be submitted on or before April 9, 2025. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.40 Vanessa A. Countryman, Secretary. [FR Doc. 2025–04512 Filed 3–18–25; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–102672; File No. SR– PEARL–2025–09] Self-Regulatory Organizations; MIAX PEARL, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend the MIAX Pearl Options Fee Schedule To Adopt New Fee Categories for the Exchange’s Proprietary Market Data Feeds March 13, 2025. 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 March 13, 2025, MIAX PEARL, LLC (‘‘Exchange’’) filed with the Securities and Exchange Commission (‘‘Commission’’) the proposed rule change as described in Item I below, which Item has been substantially prepared by the Exchange. The Exchange has designated this proposal for immediate effectiveness pursuant to Section 19(b)(3)(A) of the Act 3 and Rule 19b–4(f) thereunder.4 40 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 3 15 U.S.C. 78s(b)(3)(A). 4 17 CFR 240.19b–4(f). 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 lotter on DSK11XQN23PROD with NOTICES1 1 15 VerDate Sep<11>2014 18:11 Mar 18, 2025 Jkt 265001 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 amend the MIAX Pearl Options Exchange Fee Schedule (‘‘Fee Schedule’’) to, among other things, adopt new fee categories for the Exchange’s proprietary market data feeds the Top of Market (‘‘ToM’’) feed and the Liquidity Feed (‘‘PLF’’) feed (collectively, the ‘‘market data feeds’’).5 The proposed rule change, including the Exchange’s statement of the purpose of, and statutory basis for, the proposed rule change, is available on the Exchange’s website at https:// www.miaxglobal.com/markets/usoptions/pearl-options/rule-filings and on the Commission’s website at https:// www.sec.gov/rules-regulations/selfregulatory-organization-rulemaking/ national-securities-exchanges?file_ number=SR-PEARL-2025-09. II. 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.6 Comments may be submitted electronically by using the Commission’s internet comment form (https://www.sec.gov/rules-regulations/ self-regulatory-organizationrulemaking/national-securitiesexchanges?file_number=SR-PEARL2025-09) or by sending an email to rulecomments@sec.gov. Please include file number SR–PEARL–2025–09 on the subject line. Alternatively, paper comments may be sent to Secretary, Securities and Exchange Commission, 100 F Street NE, Washington, DC 20549–1090. All submissions should whether the proposed rule change should be approved or disapproved. 5 All references to the ‘‘Exchange’’ in this filing refer to MIAX Pearl Options. Any references to the equities trading facility of MIAX PEARL, LLC will specifically be referred to as ‘‘MIAX Pearl Equities.’’ 6 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. PO 00000 Frm 00186 Fmt 4703 Sfmt 4703 12881 refer to file number SR–PEARL–2025– 09. 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-regulations/ self-regulatory-organizationrulemaking/national-securitiesexchanges?file_number=SR-PEARL2025-09). 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–PEARL–2025–09 and should be submitted on or before April 9, 2025. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.7 Vanessa A. Countryman, Secretary. [FR Doc. 2025–04519 Filed 3–18–25; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION [Release No. 34–102656; File No. SR– CboeBZX–2025–040] Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of Filing of a Proposed Rule Change To List and Trade Shares of the Franklin XRP Fund Under BZX Rule 14.11(e)(4), Commodity-Based Trust Shares March 13, 2025. 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 March 13, 2025, Cboe BZX Exchange, Inc. (‘‘Exchange’’ or ‘‘BZX’’) filed with the Securities and Exchange Commission (‘‘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 Cboe BZX Exchange, Inc. (‘‘BZX’’ or the ‘‘Exchange’’) is filing with the Securities and Exchange Commission (‘‘Commission’’ or ‘‘SEC’’) a proposed 7 17 CFR 200.30–3(a)(12). U.S.C. 78s(b)(1). 2 17 CFR 240.19b–4. 1 15 E:\FR\FM\19MRN1.SGM 19MRN1

Agencies

[Federal Register Volume 90, Number 52 (Wednesday, March 19, 2025)]
[Notices]
[Pages 12876-12881]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2025-04512]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-102659; File No. SR-PEARL-2025-08]


Self-Regulatory Organizations; Notice of Filing of a Proposed 
Rule Change, as Modified by Partial Amendment Nos. 1 and 2, by MIAX 
PEARL, LLC To Amend Exchange Rule 402, Criteria for Underlying 
Securities, To List and Trade Options on Commodity-Based Trust Shares

March 13, 2025.
    Pursuant to the provisions of 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 March 5, 2025, MIAX PEARL, LLC (``MIAX Pearl'' 
or the ``Exchange'') filed with the Securities and Exchange Commission 
(``Commission'') a proposed rule change as described in Items I, II, 
and III below, which Items have been substantially prepared by the 
Exchange.\3\ The Commission is publishing this notice to solicit 
comments on the proposed rule change, as modified by Partial Amendments 
Nos. 1 and 2, from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ On March 11, 2025, the Exchange filed Partial Amendment No. 
1 to the proposed rule change. In addition to the changes described 
herein, Partial Amendment No. 1 corrected a marking error in 
proposed changes to the rule text in Exhibit 5 and corrected the 
header of the Exhibit 1. On March 12, 2025, the Exchange filed 
Partial Amendment No. 2 to the proposed rule change to correct a 
marking error in proposed changes to the rule text in Exhibit 5 as 
modified by Partial Amendment No. 1.
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    The Exchange proposes to amend Exchange Rule 402, Criteria for 
Underlying Securities, to list and trade options on Commodity-Based 
Trust Shares.
    The text of the proposed rule change is available on the Exchange's 
website at https://www.miaxglobal.com/markets/us-equities/pearl-equities/rule-filings, at MIAX Pearl's principal office, 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, MIAX Pearl 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. MIAX Pearl 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 amend Exchange Rule 402, Criteria for 
Underlying Securities,\4\ to allow the listing and trading of options 
on units that represent interests in a trust that in a Commodity-Based 
Trust. This is a competitive filing substantively identical to 
proposals submitted by Nasdaq ISE, LLC (``ISE''), NYSE American, LLC 
(``NYSE American''), NYSE Arca Inc. (``NYSE Arca'') and Cboe Exchange, 
Inc. (``Cboe''), which are currently pending with the Securities and 
Exchange Commission (the ``Commission'').\5\
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    \4\ The Exchange notes that its affiliate options exchanges, 
Miami International Securities Exchange, LLC (``MIAX '') and MIAX 
Sapphire, LLC (``MIAX Sapphire''), submitted (or will submit) 
substantively similar proposals. The Exchange notes that the rules 
of Chapter IV of MIAX, including Exchange Rule 402, are incorporated 
by reference into the MIAX Emerald, LLC (``MIAX Emerald'') rulebook.
    \5\ See Securities Exchange Act Release No. 102465 (February 20, 
2025) (SR-ISE-2025-08); SRNYSEArca-2025-16 (February 24, 2025); and 
SR-NYSEAmerican-2025-07 (February 24, 2025) and SR-CBOE-2025-014. 
Partial Amendment No. 1 added the citation to SR-CBOE-2025-014.
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    The Exchange proposes to allow the listing and trading of options 
on units that represent interests in a trust that in a Commodity-Based 
Trust. A Commodity-Based Trust is defined at The Nasdaq Stock Market 
LLC Rule 5711(d)(iv), NYSE Arca Rule 8.201(c), and Cboe BZX Exchange, 
Inc. 14.11(e)(4) as a security that is issued by a trust that holds (i) 
a specified commodity deposited with the Trust, or (ii) 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 (``Commodity-Based Trust Share'').
    The Exchange proposes to amend Exchange Rule 402(i) to provide that

    (i) Securities deemed appropriate for options trading shall 
include shares or other securities (``Exchange-Traded Fund Shares'') 
that are traded on a national securities exchange and are defined as 
an ``NMS stock'' under Rule 600 of Regulation NMS, and that . . . 
(4) represent interests in (i) a security issued by a trust that 
holds (A) a specified commodity deposited with the trust, or (B) a 
specified commodity and, in addition to such specified commodity, 
cash; (ii) 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 (iii) 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 (``Commodity-Based 
Trust Share'').\6\
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    \6\ Partial Amendment No. 1 removed text incorrectly included in 
the block quote describing proposed Exchange Rule 402(i).

    The Exchange proposes to insert this rule text and remove 
references to the SPDR[supreg] Gold Trust, the iShares COMEX Gold 
Trust, the iShares Silver Trust, the Aberdeen Standard Silver ETF 
Trust, the Aberdeen Standard Physical Gold Trust, the Aberdeen Standard 
Palladium ETF Trust, the Aberdeen Standard Platinum ETF Trust, the 
Goldman Sachs Physical Gold ETF, the Sprott Physical Gold Trust, the 
iShares Bitcoin Trust, the Grayscale Bitcoin Trust, the Grayscale 
Bitcoin Mini Trust, the

[[Page 12877]]

Bitwise Bitcoin ETF, the Fidelity Wise Origin Bitcoin Fund, and the ARK 
21 Shares Bitcoin ETF which are all Commodity-Based Trust Shares. As a 
result of this proposed rule change, the Exchange's listing criteria 
would allow any ETF approved to list on a primary equities market as a 
Commodity-Based Trust Share to qualify as an underlying for options 
traded on the Exchange, provided other listing criteria have been 
met.\7\
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    \7\ The Exchange believes this proposal is consistent with the 
Options Clearing Corporation (``OCC'') recent amendment of ``Fund 
Share'' (which covers ETFs), as defined in OCC's By-Laws (including 
the Interpretation and Policy), to remove references to specific 
precious metal commodity-based ETFs as ``no longer relevant or 
necessary.'' See Securities Exchange Act Release No. 102018 
(December 20, 2024), 89 FR 106660 (December 30, 2024) (SR-OCC-2024-
018). The impetus for this rule change was the staff advisory issued 
by the Commodity Futures Trading Commission (``CFTC'') that deemed 
it ```substantially likely' that spot commodity ETF shares would be 
held to be securities'' which, in turn, resulted in the OCC's 
determination that ``it no longer needs to seek product-by-product 
exemptive relief from the CFTC to clear spot commodity-based ETF 
products, including precious metals commodity-based ETFs.'' See id. 
at 106661; see also CFTC Staff Advisory Relating to the Clearing of 
Options on Spot Commodity Exchange Traded Funds (ETFs), Letter No. 
24-16 (Nov. 15, 2024), available at https://www.cftc.gov/csl/24-16/ 
download.
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    The Exchange's initial listing standards as set forth in Exchange 
Rule 402(a) for Exchange Traded Fund Shares (``ETFs'') on which options 
may be listed and traded on the Exchange, will continue to apply. 
Pursuant to Exchange Rule 402(a), a security (which includes ETFs) on 
which options may be listed and traded on the Exchange must be a 
security registered (with the Commission) and be an NMS stock (as 
defined in Rule 600 of Regulation NMS under the Act), and be 
characterized by a substantial number of outstanding shares that are 
widely held and actively traded.\8\ Additionally, Exchange Rule 
402(i)(5)(i) requires that the ETFs must either (1) meet the criteria 
and standards set forth in Exchange Rule 402(a) or 402(b),\9\ or (2) be 
available for creation or redemption each business day from or through 
the issuer in cash or in kind at a price related to net asset value, 
and the issuer must be obligated to issue ETFs in a specified aggregate 
number even if some or all of the investment assets required to be 
deposited have not been received by the issuer, subject to the 
condition that the person obligated to deposit the investments has 
undertaken to deliver the investment assets as soon as possible and 
such undertaking is secured by the delivery and maintenance of 
collateral consisting of cash or cash equivalents satisfactory to the 
issuer, as provided in the respective prospectus.
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    \8\ The criteria and guidelines for a security to be considered 
widely held and actively traded are set forth in Exchange Rule 
402(b).
    \9\ Subparagraphs (a) and (b) of Exchange Rule 402 provide for 
guidelines to be used by the Exchange when evaluating potential 
underlying securities for Exchange option transactions.
---------------------------------------------------------------------------

    Additionally, a Commodity-Based Trust Share will also be subject to 
the Exchange's continued listing standards for options on ETFs set 
forth in Exchange Rule 403(g) for ETFs deemed appropriate for options 
trading pursuant to Exchange Rule 402(i). Specifically, options 
approved for trading pursuant to Exchange Rule 402(i) will not be 
deemed to meet the requirements for continued approval, and the 
Exchange shall not open for trading any additional series of option 
contracts of the class covering such ETFs if the ETFs are delisted from 
trading as provided in Exchange rule 403(b)(4) or the ETFs are halted 
or suspended from trading on their primary market. Additionally, 
options on ETFs may be subject to the suspension of opening 
transactions in any of the following circumstances:

    (1) in the case of options covering ETFs approved for trading 
under Exchange Rule 402(i)(5)(i)(A), in accordance with the terms of 
paragraphs (b)(1), (2), and (3) of Exchange Rule 403;
    (2) in the case of options covering ETFs approved for trading 
under Exchange Rule 402(i)(5)(i)(B), following the initial twelve-
month period beginning upon the commencement of trading in the ETFs 
on a national securities exchange and are defined as an NMS stock, 
there are fewer than 50 record and/or beneficial holders of such 
ETFs for 30 or more consecutive trading days;
    (3) the value of the index or portfolio of securities, non-U.S. 
currency, or portfolio of commodities including commodity futures 
contracts, options on commodity futures contracts, swaps, forward 
contracts and/or options on physical commodities and/or financial 
instruments and money market instruments on which the ETFs are based 
is no longer calculated or available; or
    (4) such other event shall occur or condition exist that in the 
opinion of the Exchange makes further dealing in such options on the 
Exchange inadvisable.

    The Exchange notes that ETFs that hold financial instruments, money 
market instruments, precious metal commodities, or cryptocurrencies 
that are deemed commodities on which the Exchange may already list and 
trade options pursuant to Exchange Rule 402(i) are trusts structured in 
substantially the same manner as options on a Commodity Based Trust 
Share and essentially offer the same objectives and benefits to 
investors, just with respect to different assets. The Exchange notes 
that it has not identified any issues with the continued listing and 
trading of any ETF options, including ETFs that hold commodities (e.g., 
precious metals, cryptocurrencies) that it currently lists and trades 
on the Exchange.
    Options on a Commodity-Based Fund Share will be physically settled 
contracts with American-style exercise.\10\ Consistent with Exchange 
Rule 404, which governs the opening of options series on a specific 
underlying security (including ETFs), the Exchange will open at least 
one expiration month for options on a Commodity-Based Trust Share \11\ 
and may also list series of options on Commodity-Based Trust Share for 
trading on a weekly,\12\ monthly,\13\ or quarterly \14\ basis. The 
Exchange may also list long-term equity option series (``LEAPS'') that 
expire from 12 to 39 months from the time they are listed.\15\
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    \10\ See Exchange Rule 401, which provides that the rights and 
obligations of holders and writers are set forth in the Rules of the 
Options Clearing Corporation (``OCC''); see also OCC Rules, Chapters 
VIII (which governs exercise and assignment) and Chapter IX (which 
governs the discharge of delivery and payment obligations arising 
out of the exercise of physically settled stock option contracts).
    \11\ See Exchange Rule 404(b). The monthly expirations are 
subject to certain listing criteria for underlying securities 
described within Exchange Rule 404 and its Interpretations and 
Policies. Monthly listings expire the third Friday of the month. The 
term ``expiration date'' (unless separately defined elsewhere in the 
OCC By-Laws), when used in respect of an option contract (subject to 
certain exceptions), means the third Friday of the expiration month 
of such option contract, or if such Friday is a day on which the 
exchange on which such option is listed is not open for business, 
the preceding day on which such exchange is open for business. See 
OCC By-Laws Article I, Section 1. Pursuant to Exchange Rule 404(c), 
additional series of options of the same class may be opened for 
trading on the Exchange when the Exchange deems it necessary to 
maintain an orderly market, to meet customer demand or when the 
market price of the underlying stock moves more than five strike 
prices from the initial exercise price or prices. Pursuant to 
Exchange Rule 404(e), new series of options on an individual stock 
may be added until the beginning of the month in which the options 
contract will expire. Due to unusual market conditions, the 
Exchange, in its discretion, may add a new series of options on an 
individual stock until the close of trading on the business day 
prior to expiration.
    \12\ See Exchange Rule 404, Interpretations and Policies .02.
    \13\ See Exchange Rule 404, Interpretations and Policies .13.
    \14\ See Exchange Rule 404, Interpretations and Policies .03.
    \15\ See Exchange Rule 406. Partial Amendment No. 1 corrected 
this rule citation.
---------------------------------------------------------------------------

    Pursuant to Exchange Rule 404, Interpretations and Policies.06, 
which governs strike prices of series of options on ETFs, the interval 
between strike prices of series of options on ETFs approved for options 
trading pursuant to Exchange Rule 402(i) shall be fixed at a price per 
share which is reasonably close to the price per share at which the 
underlying security is traded in the primary market at or about the 
same

[[Page 12878]]

time such series of options is first open for trading on the Exchange, 
or at such intervals as may have been established on another options 
exchange prior to the initiation of trading on the Exchange. With 
respect to the Short Term Options Series or Weekly Program, during the 
month prior to expiration of an option class that is selected for the 
Short Term Option Series Program, the strike price intervals for the 
related non-Short Term Option (``Related non-Short Term Option'') shall 
be the same as the strike price intervals for the Short Term 
Option.\16\ Specifically, the Exchange may open for trading Short Term 
Option Series at strike price intervals of (i) $0.50 or greater where 
the strike price is less than $100, and $1 or greater where the strike 
price is between $100 and $150 for all option classes that participate 
in the Short Term Options Series Program; (ii) $0.50 for option classes 
that trade in one dollar increments and are in the Short Term Option 
Series Program; or (iii) $2.50 or greater where the strike price is 
above $150.\17\ Additionally, the Exchange may list series of options 
pursuant to the $1 Strike Price Interval Program,\18\ the $0.50 Strike 
Program,\19\ and the $2.50 Strike Price Program.\20\ Pursuant to 
Exchange Rule 510, where the price of a series of options on a 
Commodity-Based Trust Share is less than $3.00, the minimum increment 
will be $0.05, and where the price is $3.00 or higher, the minimum 
increment will be $0.10 \21\ consistent with the minimum increments for 
options on other ETFs listed on the Exchange. Any and all new series of 
a Commodity-Based Trust Share options that the Exchange lists will be 
consistent and comply with the expirations, strike prices, and minimum 
increments set forth in Rules 404 and 510, as applicable.
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    \16\ See Exchange Rule 404, Interpretations and Policies .02(e).
    \17\ Id.
    \18\ See Exchange Rule 404, Interpretations and Policies.01.
    \19\ See Exchange Rule 404, Interpretations and Policies.04.
    \20\ See Exchange Rule 404(f).
    \21\ See Exchange Rule 510.
---------------------------------------------------------------------------

    Options on a Commodity-Based Trust Share will trade in the same 
manner as options on other ETFs on the Exchange. The Exchange Rules 
that currently apply to the listing and trading of all options on ETFs 
on the Exchange, including, for example, Rules that govern listing 
criteria, expirations, exercise prices, minimum increments, position 
and exercise limits, margin requirements, customer accounts and trading 
halt procedures would apply to the listing and trading of options on a 
Commodity-Based Trust Share on the Exchange in the same manner as they 
apply to other options on all other ETFs that are listed and traded on 
the Exchange.
    Position and exercise limits for options on ETFs, including options 
on a Commodity-Based Trust Share, are determined pursuant to the 
Exchange's affiliate MIAX Rules 307 and 309, respectively. Position and 
exercise limits for ETF options vary according to the number of 
outstanding shares and the trading volumes of the underlying ETF over 
the past six months, where the largest in capitalization and the most 
frequently traded ETFs have an option position and exercise limits of 
250,000 contracts (with adjustments for splits, re-capitalizations, 
etc.) on the same side of the market; and smaller capitalization ETFs 
have position and exercise limits of 200,000, 75,000, 50,000 or 25,000 
contracts (with adjustments for splits, re-capitalizations, etc.) on 
the same side of the market. The Exchange further notes that the 
Exchange's affiliate MIAX Rule 1502, which governs margin requirements 
applicable to trading on the Exchange, including options on ETFs, will 
also apply to the trading on a Commodity-Based Trust Share options.
    The Exchange represents that the same surveillance procedures 
applicable to all other options on other ETFs currently listed and 
traded on the Exchange will apply to options on a Commodity Based Trust 
Share that it applies to the Exchange's other options products.\22\ The 
Exchange believes that its existing surveillance and reporting 
safeguards are designed to deter and detect possible manipulative 
behavior which might potentially arise from listing and trading options 
on ETFs, including any options on a Commodity-Based Trust Share. 
Additionally, the Exchange is a member of the Intermarket Surveillance 
Group (``ISG'') under the Intermarket Surveillance Group Agreement. ISG 
members work together to coordinate surveillance and investigative 
information sharing in the stock, options, and futures markets. In 
addition, the Exchange has a Regulatory Services Agreement with the 
Financial Industry Regulatory Authority (``FINRA''). Pursuant to a 
multi-party 17d-2 joint plan, all options exchanges allocate regulatory 
responsibilities to FINRA to conduct certain options-related market 
surveillance that are common to rules of all options exchanges.\23\ 
Also, the Exchange may obtain information from CME Group Inc.'s 
designated contract markets that are members of the ISG related to a 
financial instrument that is based, in whole or in part, upon an 
interest in or performance of a commodity, as applicable. Further, the 
Exchange will implement any new surveillance procedures it deems 
necessary to effectively monitor the trading of options on Commodity-
Based Fund Shares.
---------------------------------------------------------------------------

    \22\ The surveillance program includes real-time patterns for 
price and volume movements and post-trade surveillance patterns 
(e.g., spoofing, marking the close, pinging, phishing).
    \23\ Section 19(g)(1) of the Act, among other things, requires 
every SRO registered as a national securities exchange or national 
securities association to comply with the Act, the rules and 
regulations thereunder, and the SRO's own rules, and, absent 
reasonable justification or excuse, enforce compliance by its 
members and persons associated with its members. See 15 U.S.C. 
78q(d)(1) and 17 CFR 240.17d-2. Section 17(d)(1) of the Act allows 
the Commission to relieve an SRO of certain responsibilities with 
respect to members of the SRO who are also members of another SRO 
(``common members''). Specifically, Section 17(d)(1) allows the 
Commission to relieve an SRO of its responsibilities to: (i) receive 
regulatory reports from such members; (ii) examine such members for 
compliance with the Act and the rules and regulations thereunder, 
and the rules of the SRO; or (iii) carry out other specified 
regulatory responsibilities with respect to such members.
---------------------------------------------------------------------------

    The Exchange has also analyzed its capacity and represents that it 
believes the Exchange and the Options Price Reporting Authority 
(``OPRA'') have the necessary systems capacity to handle the additional 
traffic associated with the listing of new series of ETFs, including 
options on a Commodity-Based Trust Share, up to the number of 
expirations currently permissible under the Exchange Rules. The 
Exchange believes any additional traffic generated from the trading of 
options on Commodity-Based Trust Shares would be manageable. The 
Exchange represents that Exchange members will not have a capacity 
issue as a result of this proposed rule change.
    Further, quotation and last sale information for Commodity-Based 
Trust Shares is available via the Consolidated Tape Association 
(``CTA'') high speed line. Quotation and last sale information for such 
securities is also available from the exchange on which such securities 
are listed. Quotation and last sale information for options on 
Commodity-Based Trust Shares will be available via OPRA and major 
market data vendors.
    The Exchange notes that the Commission has previously approved 
generic listing standards pursuant to Rule 19b-4(e) of the Act \24\ for 
ETFs based on indexes that consist of stocks listed on U.S. 
exchanges.\25\ In addition,

[[Page 12879]]

the Commission has previously approved proposals for the listing and 
trading of options on ETFs based on international indexes as well as 
global indexes (e.g., based on non-U.S. and U.S. component stocks).\26\
---------------------------------------------------------------------------

    \24\ 17 CFR 240.19b-4(e).
    \25\ See Securities Exchange Act Release No. 54739 (November 9, 
2006), 71 FR 66993 (November 17, 2006) (SR-AMEX-2006-78) (approval 
order relating to generic listing standards for ETFs based on 
international or global indexes).
    \26\ See, e.g., Securities Exchange Act Release Nos. 56778 
(November 9, 2007), 72 FR 65113 (November 19, 2007) (SR-AMEX-2007-
100) (approval order to list and trade options on iShares MSCI 
Mexico Index Fund); and 55648 (April 19, 2007), 72 FR 20902 (April 
26, 2007) (SR-AMEX-2007-09) (approval order to list and trade 
options on Vanguard Emerging Markets ETF); see also Securities 
Exchange Act Release Nos. 50189 (August 12, 2004), 69 FR 51723 
(August 20, 2004) (SR-AMEX-2001-05) (approving the listing and 
trading of certain Vanguard International Equity Index Funds); and 
44700 (August 14, 2001), 66 FR 43927 (August 21, 2001) (SR-2001-
34)(approving the listing and trading of series of the iShares Trust 
based on foreign stock indexes).
---------------------------------------------------------------------------

    In approving Commodity-Based Trust Shares for equities exchange 
trading, the Commission thoroughly considered the structure of the 
Commodity-Based Trust Shares, their usefulness to investors and to the 
markets, and self-regulatory organization rules that govern their 
trading. The Exchange believes that allowing the listing of options 
overlying Commodity-Based Trust Shares that are listed pursuant to 
Commission approval on equities exchanges and applying Rule 19b-4(e) 
\27\ should fulfill the intended objective of that rule by allowing 
options on those Commodity-Based Trust Shares that have satisfied the 
generic listing standards to commence trading, without the need for the 
public comment period and Commission approval. The proposed rule change 
has the potential to significantly reduce the time and costs associated 
with bringing options on Commodity-Based Trust Shares to market, 
thereby reducing the burden on issuers and other market participants, 
while also promoting competition among options exchanges, to the 
benefit of the investing public. The failure of a particular Commodity-
Based Trust Share to comply with the generic listing standards under 
Rule 19b-4(e) \28\ would not, however, preclude the Exchange from 
submitting a separate filing pursuant to Section 19(b)(2) \29\ 
requesting Commission approval to list and trade options on a 
particular Commodity-Based Trust Share.
---------------------------------------------------------------------------

    \27\ 17 CFR 240.19b-4(e).
    \28\ Id.
    \29\ 15 U.S.C. 78s(b)(2).
---------------------------------------------------------------------------

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.\30\ Specifically, the Exchange believes the proposed rule change 
is consistent with the Section 6(b)(5) \31\ 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. 
Additionally, the Exchange believes the proposed rule change is 
consistent with the Section 6(b)(5) \32\ requirement that the rules of 
an exchange not be designed to permit unfair discrimination between 
customers, issuers, brokers, or dealers.
---------------------------------------------------------------------------

    \30\ 15 U.S.C. 78f(b).
    \31\ 15 U.S.C. 78f(b)(5).
    \32\ Id.
---------------------------------------------------------------------------

    In particular, the Exchange believes that the proposal will remove 
impediments to and perfect the mechanism of a free and open market and 
a national market system and, in general, protect investors because it 
would allow the Exchange to immediately list and trade options on any 
Commodity-Based Trust Share, provided the initial listing criteria has 
been met, without any additional approvals from the Commission.\33\ 
Commodity-Based Trust Shares are securities approved for trading by the 
Commission. The Exchange believes that with this proposal it will be 
able to offer options on a Commodity-Based Trust Share soon after the 
listing of such underlying security in the primary market, provided the 
initial listing criteria has been met, thereby availing market 
participants of the opportunity to hedge their positions in the ETF in 
a timely manner. Given the potential to reduce the time to market for 
options on Commodity-Based Trust Shares, the proposed rule change will 
also reduce the burdens on issuers and other market participants, while 
also promoting competition among options exchanges to the benefit of 
the investing public. This proposal would permit options on Commodity-
Based Trust Shares to be listed on the Exchange in the same manner as 
all other securities that are subject to the current listing criteria 
in Exchange Rule 402. The Exchange notes that the majority of ETFs are 
able to list and trade options once the initial listing criteria have 
been met without the need for additional approvals. The proposed rule 
change would allow options on a Commodity-Based Trust Share to likewise 
list and trade options once the initial listing criteria have been met 
without the need for additional approvals. Accordingly, the proposed 
rule change would align the treatment of Commodity-Based Trust Shares 
with other ETFs for purposes of options trading, which would add 
internal consistency to Exchange rules.
---------------------------------------------------------------------------

    \33\ As noted herein, the Exchange believes this proposal is 
consistent with the OCC's determination that, based on a staff 
advisory from the CFTC, the ``it no longer needs to seek product-by-
product exemptive relief from the CFTC to clear spot commodity-based 
ETF products.'' See supra note 7.
---------------------------------------------------------------------------

    The Exchange believes that the proposed rule change will facilitate 
the listing and trading of options on additional ETFs that will enhance 
competition among market participants, to the benefit of investors and 
the marketplace. Like options on any other securities, options on 
Commodity-Based Trust Shares provides investors with the ability to 
hedge exposure to the underlying security similar to options on any 
other securities. Options on Commodity-Based Trust Shares benefits 
investors, similar to the listing of any other option on an ETF, by 
providing investors with a relatively lower-cost risk management tool, 
to manage their positions and associated risk in their portfolios more 
easily in connection with exposure to the price of a commodity. 
Additionally, options on a Commodity-Based Trust Share provide 
investors with the ability to transact in such options in a listed 
market environment as opposed to in the unregulated OTC options market, 
which increases market transparency and enhances the process of price 
discovery conducted on the Exchange through increased order flow to the 
benefit of all investors.
    The Exchange also notes that it already lists options on other 
commodity based ETFs,\34\ which, as described above, are trusts 
structured as Commodity-Based Trust Shares. The Exchange has not 
identified any issues with the continued listing and trading of options 
on Commodity-Based Trust Shares it currently lists for trading.
---------------------------------------------------------------------------

    \34\ See Exchange Rule 402(i)(4).
---------------------------------------------------------------------------

    The Exchange also believes the proposed rule change will remove 
impediments to and perfect the mechanism of a free and open market and 
a national market system, because it is consistent with current 
Exchange Rules, previously filed with the Commission. Options on a 
Commodity-Based Trust Share must satisfy the initial listing standards 
and continued listing standards currently in the Exchange Rules 
applicable to options on

[[Page 12880]]

all ETFs, including ETFs that hold other commodities already deemed 
appropriate for options trading on the Exchange.\35\ Options on a 
Commodity-Based Trust Share would trade in the same manner as any other 
ETF options--the same Exchange Rules that currently govern the listing 
and trading of all ETF options, including permissible expirations, 
strike prices and minimum increments, and applicable position and 
exercise limits and margin requirements, will govern the listing and 
trading of options on a Commodity-Based Trust Share in the same manner.
---------------------------------------------------------------------------

    \35\ Id.
---------------------------------------------------------------------------

    The Exchange believes the proposed rule change will result in 
increased competition as other exchanges will likely adopt an identical 
rule to the one proposed by the Exchange that would allow the listing 
and trading of options on Commodity-Based Trust Shares that are 
approved for trading on those other markets.\36\ Multiple listing of 
ETFs, options and other securities and competition are some of the 
central features of the national market system. The Exchange believes 
that the proposal would encourage a more open market and national 
market system based on competition and multiple listing. The Exchange 
represents that it has the necessary systems capacity to support the 
listing and trading of options on Commodity-Based Trust Shares as the 
Exchange lists these products today, except that it requires additional 
approvals prior to listing.
---------------------------------------------------------------------------

    \36\ See supra note 5.
---------------------------------------------------------------------------

    The Exchange believes that its existing surveillance and reporting 
safeguards are designed to deter and detect possible manipulative 
behavior which might arise from listing and trading of these ETF 
options.\37\
---------------------------------------------------------------------------

    \37\ Partial Amendment No. 1 removed a duplicative sentence from 
the beginning of this paragraph.
---------------------------------------------------------------------------

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. In this regard and as 
indicated above, the Exchange notes that the rule change is being 
proposed as a competitive response to the filings submitted by ISE, 
NYSE American, NYSE Arca, and Cboe.\38\
---------------------------------------------------------------------------

    \38\ See supra note 5.
---------------------------------------------------------------------------

    The Exchange believes that the proposal is pro-competitive and is a 
competitive response to the Exchange's inability to list options on 
Commodity-Based Trust Shares without the need for additional approvals. 
The Exchange believes the proposed rule change will result in 
additional investment options and opportunities to achieve the 
investment objectives of market participants seeking efficient trading 
and hedging vehicles, to the benefit of investors, market participants, 
and the marketplace in general. Competition is one of the principal 
features of the national market system. The Exchange believes that this 
proposal will expand competitive opportunities to list and trade 
products on the Exchange as noted.
    The Exchange does not believe the proposal will impose any burden 
on intra-market competition that is not necessary or appropriate in 
furtherance of the purposes of the Act because Commodity-Based Trust 
Shares, like any other ETF, would have to satisfy the Exchange's 
initial listing standards to be eligible for options trading. 
Additionally, the proposed rule change would apply to all market 
participants in the same manner as options on Commodity-Based Trust 
Shares will be equally available to all market participants who wish to 
trade such options.
    The Exchange does not believe the proposal will impose any burden 
on inter-market competition that is not necessary or appropriate in 
furtherance of the purposes of the Act, as nothing prevents the other 
options exchanges from proposing similar rules to list and trade 
options on Commodity-Based Trust Shares. As noted herein, ISE, NYSE 
American, NYSE Arca, and Cboe have submitted a proposal to adopt an 
identical rule to allow ISE, NYSE American, NYSE Arca, and Cboe list 
and trade options on Commodity-Based Trust Shares without the need for 
additional approvals.\39\
---------------------------------------------------------------------------

    \39\ See supra note 5.
---------------------------------------------------------------------------

    Furthermore, the Exchange notes that listing and trading options on 
a Commodity-Based Trust Share on the Exchange will subject such options 
to transparent exchange-based rules as well as price discovery and 
liquidity, as opposed to alternatively trading such options in the OTC 
market. The Exchange believes that the proposed rule change may relieve 
any burden on, or otherwise promote, competition as it is designed to 
increase competition for order flow on the Exchange in a manner that is 
beneficial to investors by providing them with a lower-cost option to 
hedge their investment portfolios in a timely manner.

C. Self-Regulatory Organization's Statement on Comments on The Proposed 
Rule Change Received From Members, Participants, or Others

    Written comments were neither solicited nor received.

III. Date of Effectiveness of the Proposed Rule Change and Timing for 
Commission Action

    Within 45 days of the date of publication of this notice in the 
Federal Register or within such longer period up to 90 days (i) as the 
Commission may designate if it finds such longer period to be 
appropriate and publishes its reasons for so finding or (ii) as to 
which the Exchange consents, the Commission will:
    A. by order approve or disapprove such proposed rule change, or
    B. institute proceedings to determine whether the proposed rule 
change should be 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-PEARL-2025-08 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-PEARL-2025-08. 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

[[Page 12881]]

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-PEARL-2025-08 and should be submitted on or before April 9, 2025.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\40\
---------------------------------------------------------------------------

    \40\ 17 CFR 200.30-3(a)(12).
---------------------------------------------------------------------------

Vanessa A. Countryman,
Secretary.
[FR Doc. 2025-04512 Filed 3-18-25; 8:45 am]
BILLING CODE 8011-01-P
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