Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing of Proposed Rule Change To List and Trade Shares of the Truth Social Bitcoin ETF, B.T. Under NYSE Arca Rule 8.201-E (Commodity-Based Trust Shares), 26365-26372 [2025-11291]

Download as PDF Federal Register / Vol. 90, No. 117 / Friday, June 20, 2025 / Notices A. Self-Regulatory Organization’s Statement of the Purpose of, and the Statutory Basis for, the Proposed Rule Change SECURITIES AND EXCHANGE COMMISSION [Release No. 34–103261; File No. SR– NYSEARCA–2025–40] Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing of Proposed Rule Change To List and Trade Shares of the Truth Social Bitcoin ETF, B.T. Under NYSE Arca Rule 8.201–E (Commodity-Based Trust Shares) June 16, 2025. Pursuant to Section 19(b)(1) 1 of the Securities Exchange Act of 1934 (‘‘Act’’) 2 and Rule 19b–4 thereunder,3 notice is hereby given that, on June 3, 2025, NYSE Arca, Inc. (‘‘NYSE Arca’’ or the ‘‘Exchange’’) filed with the Securities and Exchange Commission (the ‘‘Commission’’) the proposed rule change as described in Items I, II, and III below, which Items have been prepared by the self-regulatory organization. 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 list and trade shares of the following under NYSE Arca Rule 8.201–E: Truth Social Bitcoin ETF, B.T. (the ‘‘Trust’’). The proposed rule change is available on the Exchange’s website at www.nyse.com, at the principal office of the Exchange, and at the Commission’s Public Reference Room. ddrumheller on DSK120RN23PROD with NOTICES1 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 self-regulatory organization 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 those 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 parts of such statements. 1 15 U.S.C. 78s(b)(1). U.S.C. 78a. 3 17 CFR 240.19b–4. 2 15 VerDate Sep<11>2014 20:05 Jun 18, 2025 Jkt 265001 1. Purpose Under NYSE Arca Rule 8.201–E, the Exchange may propose to list and/or trade pursuant to unlisted trading privileges ‘‘Commodity-Based Trust Shares.’’ 4 The Exchange proposes to list and trade shares (the ‘‘Shares’’) of the Trust pursuant to NYSE Arca Rule 8.201–E.5 The sponsor of the Trust is Yorkville America Digital, LLC (the ‘‘Sponsor’’), a Florida limited liability company. The Trust is a Nevada business trust that operates pursuant to a trust agreement (the ‘‘Trust Agreement’’) between the Sponsor and the trustee for the Trust (the ‘‘Trustee’’). The custodian for the Trust’s bitcoin is Foris DAX Trust Company, LLC (the ‘‘Bitcoin Custodian’’). The custodian for the Trust’s cash is referred to here as the ‘‘Cash Custodian,’’ the administrator and transfer agent of the Trust as the ‘‘Transfer Agent’’ and its administrator as the ‘‘Trust Administrator.’’ Each Share issued by the Trust represents a fractional undivided beneficial interest in the net assets of the Trust. The assets of the Trust consist primarily of bitcoin held by the Bitcoin Custodian on behalf of the Trust.6 Investment Objective According to the Registration Statement, the Trust seeks to reflect 4 Commodity-Based Trust Shares are securities issued by a trust that represent investors’ discrete identifiable and undivided beneficial ownership interest in the commodities deposited into the Trust. 5 The Trust expects to file a registration statement on Form S–1 under the Securities Act (the ‘‘Registration Statement’’). The descriptions of the Trust and Shares contained herein are based, in part, on a draft of the Registration Statement. The Registration Statement is not yet effective, and the Shares will not trade on the Exchange until such time that the Registration Statement is effective. 6 From time to time, the Trust may be entitled to, or come into possession of rights to acquire, or otherwise establish dominion and control over, any virtual currency (for avoidance of doubt, other than bitcoin) or other asset or right, which rights are incident to the Trust’s ownership of bitcoin and arise without any action of the Trust, or of the Sponsor on behalf of the Trust (‘‘Incidental Rights’’) and/or virtual currency tokens, or other assets or rights, acquired by the Trust through the exercise (subject to the applicable provisions of the Trust Agreement) of any Incidental Right (‘‘IR Digital Assets’’) by virtue of its ownership of bitcoin, generally through a fork in the Bitcoin Blockchain, an airdrop offered to holders of bitcoin or other similar event. With respect to a fork, airdrop or similar event, the Sponsor will cause the Trust to permanently and irrevocably abandon the Incidental Rights and IR Digital Assets. In the event the Trust seeks to change this position, the Exchange would file a subsequent proposed rule change with the Commission. PO 00000 Frm 00100 Fmt 4703 Sfmt 4703 26365 generally the performance of the price of bitcoin. The Trust seeks to reflect such performance before payment of the Trust’s expenses and liabilities. The Shares are intended to constitute a simpler means of making an investment similar to an investment in bitcoin rather than by acquiring, holding and trading bitcoin directly on a peer-to-peer or other basis or via a digital asset trading platform. The Shares have been designed to remove the obstacles represented by the complexities and operational burdens involved in a direct investment in bitcoin, while at the same time having an intrinsic value that reflects, at any given time, the investment exposure to the bitcoin owned by the Trust at such time, less the Trust’s expenses and liabilities. Although the Shares are not the exact equivalent of a direct investment in bitcoin, they provide investors with an alternative method of achieving investment exposure to bitcoin through the securities market, which may be more familiar to them. Custody of the Trust’s Bitcoin The Bitcoin Custodian will keep custody of all of the Trust’s bitcoin, other than that which is maintained in a trading account (the ‘‘Trading Balance’’) with the prime execution agent for the Trust (the ‘‘Prime Execution Agent’’), in accounts that are required to be segregated from the assets held by the Bitcoin Custodian as principal and the assets of its other customers (the ‘‘Vault Balance’’). The Bitcoin Custodian will keep all of the private keys associated with the Trust’s bitcoin held by the Bitcoin Custodian in the Vault Balance in ‘‘cold storage,’’ which refers to a safeguarding method by which the private keys corresponding to the Trust’s bitcoin are generated and stored in an offline manner using computers or devices that are not connected to the internet, which is intended to make them more resistant to hacking. The Sponsor represents that it will maintain ownership and control of the Trust’s bitcoin in a manner consistent with good delivery requirements for spot commodity transactions. Valuation of Bitcoin and Determination of NAV The net asset value of the trust (the ‘‘NAV’’) will be equal to the total assets of the Trust, which will consist solely of bitcoin and cash, less total liabilities of the Trust. In determining the NAV, the Trust Administrator values the bitcoin held by the Trust based on the CF Benchmarks Index (the ‘‘Index’’), unless otherwise E:\FR\FM\20JNN1.SGM 20JNN1 ddrumheller on DSK120RN23PROD with NOTICES1 26366 Federal Register / Vol. 90, No. 117 / Friday, June 20, 2025 / Notices determined by the Sponsor in its sole discretion. If the Index is not available or the Sponsor determines, in its sole discretion, that the Index should not be used, the Trust’s holdings may be fair valued in accordance with policies approved by the Sponsor. If the Index is not used, the Trust will notify the Exchange and its shareholders (‘‘Shareholders’’) in a prospectus supplement, in its periodic Exchange Act reports and/or on the Trust’s website. On each Business Day at 4:00 p.m. E.T., or as soon thereafter as practicable, the Trust Administrator will evaluate the bitcoin held by the Trust as reflected by the Index and determine the NAV and net asset value per Share (‘‘NAV per Share’’) of the Trust. For purposes of making these calculations, a ‘‘Business Day’’ means any day other than a day when NYSE Arca is closed for regular trading. According to the Registration Statement, the Index is designed based on the IOSCO Principles for Financial Benchmarks and is a registered benchmark under the U.K. Benchmark Regulations (‘‘BMR’’). The administrator of the Index is CF Benchmarks Ltd. (the ‘‘Index Administrator’’), a U.K. incorporated company, authorized and regulated by the U.K. Financial Conduct Authority (the ‘‘FCA’’) as a benchmark administrator, under U.K. BMR. The Index serves as a once-a-day benchmark rate of the U.S. dollar price of bitcoin (‘‘USD/BTC’’), calculated as of 4:00 p.m. E.T. The Index aggregates the trade flow of several bitcoin platforms, during an observation window between 3:00 p.m. and 4:00 p.m. E.T. into the U.S. dollar price of one bitcoin at 4:00 p.m. E.T. Specifically, the Index is calculated based on the ‘‘Relevant Transactions’’ (as defined below) of all of its constituent bitcoin platforms (collectively, the ‘‘Constituent Platforms’’), which may change from time to time. A ‘‘Relevant Transaction’’ is any cryptocurrency versus U.S. dollar spot trade that occurs during the observation window between 3:00 p.m. and 4:00 p.m. E.T. on a Constituent Platform in the BTC/USD pair that is reported and disseminated by a Constituent Platform through its publicly available Application Programming Interface (‘‘API’’) and observed by the Index Administrator. The Index is calculated based on the Relevant Transactions on the Constituent Platforms, as follows: • All Relevant Transactions are added to a joint list, recording the time of execution and trade price for each transaction. VerDate Sep<11>2014 20:05 Jun 18, 2025 Jkt 265001 • The list is partitioned by timestamp into 12 equally sized time intervals of five minute length. • For each partition separately, the volume-weighted median trade price is calculated from the trade prices and sizes of all Relevant Transactions, i.e., across all Constituent Platforms. • The Index Administrator’s Bitcoin Reference Rate (the ‘‘Reference Rate’’) is then determined by the equally weighted average of the volume medians of all partitions. According to the Registration Statement, Constituent Platforms are selected by the Oversight Committee of the Index Administrator (the ‘‘Oversight Committee’’). A trading platform is eligible as a Constituent Platform if it offers a market that facilitates the spot trading of the relevant cryptocurrency base asset against the corresponding quote asset, including markets where the quote asset is made fungible with accepted assets (the ‘‘Relevant Pair’’), and makes trade data and order data available through an API with sufficient reliability, detail and timeliness, in the opinion of the Oversight Committee. As of March 31, 2025, the Constituent Platforms included in the Index are as follows: • Crypto.com: A Singapore-based trading platform registered as a money services business (‘‘MSB’’) with the U.S. Department of Treasury’s Financial Crimes Enforcement Network (‘‘FinCEN’’) and licensed as a money transmitter in various U.S. states. • Bitstamp: A U.K.-based platform registered as an MSB with FinCEN and licensed as a virtual currency business under the New York Department of Financial Services (‘‘NYDFS’’) BitLicense regulation, as well as a money transmitter in various U.S. states. • Bullish: A Gibraltar-based platform operated by Bullish (GI) Limited and regulated by the Gibraltar Financial Services Commission (‘‘GFSC’’) as a distributed ledger technology (‘‘DLT’’) provider for execution and custody services. • Coinbase: A U.S.-based platform registered as an MSB with FinCEN, licensed as a virtual currency business under the NYDFS BitLicense regulation and licensed as a money transmitter in various U.S. states. • Gemini: A U.S.-based platform that is licensed as a virtual currency business under the NYDFS BitLicense regulation. Gemini is also registered with FinCEN as an MSB and is licensed as a money transmitter in various U.S. states. • itBit: A U.S.-based platform that is licensed as a virtual currency business under the NYDFS BitLicense regulation. PO 00000 Frm 00101 Fmt 4703 Sfmt 4703 ItBit is also registered with FinCEN as an MSB and is licensed as a money transmitter in various U.S. states. • Kraken: A U.S.-based platform that is registered as an MSB with FinCEN in various U.S. states. Kraken is also registered with the FCA and is authorized by the Central Bank of Ireland as a virtual asset service provider. Kraken also holds a variety of other licenses and regulatory approvals, including those from the Japan Financial Services Agency and the Canadian Securities Administrators. • LMAX Digital: A Gibraltar-based platform registered as an MSB with FinCEN and regulated by the GFSC as a DLT provider for execution and custody services. LMAX Digital is part of LMAX Group, a U.K.-based operator of an FCA-regulated multilateral trading facility and broker-dealer. The Index is subject to the U.K. BMR regulations, compliance with which has been subject to a Limited Assurance Audit under the ISAE 3000 standard as of September 12, 2022, and is administered under the CF Benchmarks Control Framework to ensure compliance with U.K. BMR regulations. Bitcoin and the Bitcoin Network Bitcoin is a digital asset that is created and transmitted through the operations of the peer-to-peer network (the ‘‘Bitcoin Network’’), a decentralized network of computers that operates pursuant to cryptographic protocols. No single entity owns or operates the Bitcoin Network, the infrastructure of which is collectively maintained by its user base. The Bitcoin Network allows people to exchange tokens of value, called bitcoin, which are recorded on a public transaction ledger known as the ‘‘Bitcoin Blockchain.’’ Bitcoin can be used to pay for goods and services, or it can be converted to fiat currencies, such as the U.S. dollar, at rates determined on bitcoin platforms that enable trading in bitcoin or in individual end-user-to-end-user transactions under a barter system. The Bitcoin Network is commonly understood to be decentralized and does not require governmental authorities or financial institution intermediaries to create, transmit or determine the value of bitcoin. Rather, bitcoin is created and allocated by the Bitcoin Network’s cryptographic protocols through a ‘‘mining’’ process. The value of bitcoin is determined by the supply of and demand for bitcoin on bitcoin platforms or in private end-user-to-end-user transactions. New bitcoin are created and rewarded to the miners of a block in the Bitcoin Blockchain for verifying transactions. E:\FR\FM\20JNN1.SGM 20JNN1 Federal Register / Vol. 90, No. 117 / Friday, June 20, 2025 / Notices The Bitcoin Blockchain is a shared database that includes all blocks that have been added by miners, and it is updated to include new blocks as they are added. Each bitcoin transaction is broadcast to the Bitcoin Network and, when included in a block, recorded in the Bitcoin Blockchain. As each new block records outstanding bitcoin transactions, and outstanding transactions are settled and validated through such recording, the Bitcoin Blockchain represents a complete, transparent and unbroken history of all transactions of the Bitcoin Network. ddrumheller on DSK120RN23PROD with NOTICES1 Overview of the Bitcoin Network’s Operations In order to own, transfer or use bitcoin directly on the Bitcoin Network (as opposed to through an intermediary, such as a trading platform), a person generally must have internet access to connect to the Bitcoin Network. Bitcoin transactions may be made directly between end users without the need for a third-party intermediary. To prevent the possibility of double-spending bitcoin, a user must notify the Bitcoin Network of the transaction by broadcasting the transaction data to its network peers. The Bitcoin Network provides confirmation against doublespending by memorializing every transaction in the Bitcoin Blockchain, which is publicly accessible and transparent. This memorialization and verification against double-spending is accomplished through the Bitcoin Network mining process, which adds ‘‘blocks’’ of data, including recent transaction information, to the Bitcoin Blockchain. Overview of Bitcoin Transfers Prior to engaging in bitcoin transactions directly on the Bitcoin Network, a user generally must first install on its computer or mobile device a Bitcoin Network software program that will allow the user to generate a private and public key pair associated with a bitcoin address commonly referred to as a ‘‘wallet.’’ The Bitcoin Network software program and the bitcoin address also enable the user to connect to the Bitcoin Network and transfer bitcoin to, and receive bitcoin from, other users. Each Bitcoin Network address, or wallet, is associated with a unique ‘‘public key’’ and ‘‘private key’’ pair. To receive bitcoin, the bitcoin recipient must provide its public key to the party initiating the transfer. This activity is analogous to a recipient for a transaction in U.S. dollars providing a routing address in wire instructions to the payor so that cash may be wired to the VerDate Sep<11>2014 20:05 Jun 18, 2025 Jkt 265001 recipient’s account. The payor approves the transfer to the address provided by the recipient by ‘‘signing’’ a transaction that consists of the recipient’s public key with the private key of the address from where the payor is transferring the bitcoin. The recipient, however, does not make public or provide to the sender its related private key. Neither the recipient nor the sender reveals its private keys in a transaction because the private key authorizes transfer of the funds in that address to other users. Therefore, if a user loses his private key, the user may permanently lose access to the bitcoin contained in the associated address. When sending bitcoin, a user’s Bitcoin Network software program must validate the transaction with the associated private key. The resulting digitally validated transaction is sent by the user’s Bitcoin Network software program to the Bitcoin Network to allow transaction confirmation. Some bitcoin transactions are conducted ‘‘off-blockchain’’ and are therefore not recorded in the Bitcoin Blockchain. Some ‘‘off-blockchain transactions’’ involve the transfer of control over, or ownership of, a specific digital wallet holding bitcoin or the reallocation of ownership of certain bitcoin in a digital wallet containing assets owned by multiple persons, such as a digital wallet maintained by a digital asset trading platform. In contrast to on-blockchain transactions, which are publicly recorded on the Bitcoin Blockchain, information and data regarding off-blockchain transactions are generally not publicly available. Offblockchain transactions do not involve the transfer of transaction data on the Bitcoin Network and do not reflect a movement of bitcoin between addresses recorded in the Bitcoin Blockchain. For these reasons, off-blockchain transactions are subject to risks as any such transfer of bitcoin ownership is not protected by the protocol behind the Bitcoin Network or recorded in, and validated through, the blockchain mechanism. Summary of a Bitcoin Transaction In a bitcoin transaction directly on the Bitcoin Network between two parties (as opposed to through an intermediary, such as a platform or a custodian), the following circumstances must initially be in place: (i) the party seeking to send bitcoin must have a Bitcoin Network public key, and the Bitcoin Network must recognize that public key as having sufficient bitcoin for the transaction; (ii) the receiving party must have a Bitcoin Network public key; and (iii) the spending party must have PO 00000 Frm 00102 Fmt 4703 Sfmt 4703 26367 internet access with which to send its spending transaction. The receiving party must provide the spending party with its public key and allow the Bitcoin Blockchain to record the sending of bitcoin to that public key. After the provision of a recipient’s Bitcoin Network public key, the spending party must enter the address into its Bitcoin Network software program along with the number of bitcoin to be sent. The number of bitcoin to be sent will typically be agreed upon between the two parties based on a set number of bitcoin or an agreed-upon conversion of the value of fiat currency to bitcoin. Since every computation on the Bitcoin Network requires the payment of bitcoin, including verification and memorialization of bitcoin transfers, there is a transaction fee involved with the transfer, which is based on computation complexity and not on the value of the transfer and is paid by the payor with a fractional number of bitcoin. After the entry of the Bitcoin Network address, the number of bitcoin to be sent and the transaction fees, if any, to be paid, will be transmitted by the spending party. The transmission of the spending transaction results in the creation of a data packet by the spending party’s Bitcoin Network software program, which is transmitted onto the Bitcoin Network, resulting in the distribution of the information among the software programs of users across the Bitcoin Network for eventual inclusion in the Bitcoin Blockchain. Creation of a New Bitcoin New bitcoin is created through the mining process. The Bitcoin Network is kept running by computers all over the world. In order to incentivize those who incur the computational costs of securing the network by validating transactions, there is a reward that is given to the computer that was able to create the latest block on the chain. Every 10 minutes, on average, a new block is added to the Bitcoin Blockchain with the latest transactions processed by the network, and the computer that generated this block is currently awarded 3.125 bitcoin. Due to the nature of the algorithm for block generation, this process (called ‘‘proofof-work’’ consensus) is random. Over time, rewards are expected to be proportionate to the computational power of each machine. The process by which bitcoin is ‘‘mined’’ results in new blocks being added to the Bitcoin Blockchain and new bitcoin tokens being issued to the E:\FR\FM\20JNN1.SGM 20JNN1 26368 Federal Register / Vol. 90, No. 117 / Friday, June 20, 2025 / Notices ddrumheller on DSK120RN23PROD with NOTICES1 miners. Computers on the Bitcoin Network engage in a set of prescribed complex mathematical calculations in order to add a block to the Bitcoin Blockchain and thereby confirm bitcoin transactions included in that block’s data. To begin mining, a user can download and run Bitcoin Network mining software, whereby the user’s computer acts as a ‘‘node’’ on the Bitcoin Network that validates blocks. Each block contains the details of some or all of the most recent transactions that are not memorialized in prior blocks, as well as a record of the award of bitcoin to the miner who added the new block. Each unique block can be solved and added to the Bitcoin Blockchain by only one miner. Therefore, all individual miners and mining pools on the Bitcoin Network are engaged in a competitive process of constantly seeking to increase their computing power to improve their likelihood of solving for new blocks. As more miners join the Bitcoin Network and its processing power increases, the Bitcoin Network adjusts the complexity of the block-solving equation to maintain a predetermined pace of adding a new block to the Bitcoin Blockchain approximately every 10 minutes. A miner’s proposed block is added to the Bitcoin Blockchain once a majority of the nodes on the Bitcoin Network confirms the miner’s work. Miners that are successful in adding a block to the Bitcoin Blockchain are automatically awarded bitcoin for their effort and may also receive transaction fees paid by transferors whose transactions are recorded in the block. This reward system is the method by which new bitcoin enter circulation. The Bitcoin Network is designed in such a way that the reward for adding new blocks to the Bitcoin Blockchain decreases over time. More specifically, the reward rate halves approximately every four years. Once new bitcoin tokens are no longer awarded for adding a new block (expected to occur in the year 2140), miners will only have transaction fees to incentivize them, and as a result, it is expected that miners will need to be better compensated with higher transaction fees to ensure that there is adequate incentive for them to continue mining. Limits on Bitcoin Supply Under the source code that governs the Bitcoin Network, the supply of new bitcoin is mathematically controlled so that the number of bitcoin grows at a limited rate pursuant to a preset schedule. The number of bitcoin awarded for solving a new block is automatically halved after every 210,000 VerDate Sep<11>2014 20:05 Jun 18, 2025 Jkt 265001 blocks are added to the Bitcoin Blockchain, approximately every four years. Currently, the fixed reward for solving a new block is 3.125 bitcoin per block, and this is expected to decrease by half to become 1.5625 bitcoin in approximately mid-2028. This deliberately controlled rate of bitcoin creation means that the number of bitcoin in existence will increase at a controlled rate until the number of bitcoin in existence reaches the predetermined 21 million bitcoin. However, the 21 million supply cap could be changed pursuant to a hard fork. As of December 31, 2024, approximately 19.8 million bitcoin were outstanding and the date when the 21 million bitcoin limitation will be reached is estimated to be the year 2140. The Structure and Operation of the Trust Protects Investors and Satisfies Commission Requirements for BitcoinBased Exchange-Traded Products (‘‘ETP’’) On January 10, 2024, the Commission approved the listing and trading of shares of Grayscale Bitcoin Trust (BTC) and Bitwise Bitcoin ETF under NYSE Arca Rule 8.201–E (Commodity-Based Trust Shares); the Hashdex Bitcoin ETF under NYSE Arca Rule 8.500–E (Trust Units); the iShares Bitcoin Trust and Valkyrie Bitcoin Fund under Nasdaq Rule 5711(d) (Commodity-Based Trust Shares); and the ARK 21Shares Bitcoin ETF, Invesco Galaxy Bitcoin ETF, VanEck Bitcoin Trust, the WisdomTree Bitcoin Fund, Fidelity Wise Origin Bitcoin Fund and Franklin Bitcoin ETF under BZX Rule 14.11(e)(4) (Commodity-Based Trust Shares) (collectively, the ‘‘Bitcoin ETPs’’).7 In the Bitcoin ETP Approval Order, the Commission found that the proposed rule changes to list the Bitcoin ETPs demonstrated that there were ‘‘sufficient ‘other means’ of preventing fraud and manipulation,’’ including that: [B]ased on the record before the Commission and the improved quality of the correlation analysis in the record, including the Commission’s own analysis, the Commission is able to conclude that fraud or manipulation that impacts prices in spot bitcoin markets would likely similarly impact CME bitcoin futures prices. And 7 Securities Exchange Act Release No. 34–99306 (January 10, 2024), 89 FR 3008 (January 17, 2024) (SR–NYSEARCA–2021–90; SR–NYSEARCA–2023– 44; SRNYSEARCA–2023–58; SR–NASDAQ–2023– 016; SR–NASDAQ–2023–019; SR–CboeBZX– 2023028; SR–CboeBZX–2023–038; SR–CboeBZX– 2023–040; SR–CboeBZX–2023–042; SRCboeBZX– 2023–044; SR–CboeBZX–2023–072) (Order Granting Accelerated Approval of Proposed Rule Changes, as Modified by Amendments Thereto, to List and Trade Bitcoin-Based Commodity-Based Trust Shares and Trust Units) (the ‘‘Bitcoin ETP Approval Order’’). PO 00000 Frm 00103 Fmt 4703 Sfmt 4703 because the CME’s surveillance can assist in detecting those impacts on CME bitcoin futures prices, the Exchanges’ comprehensive surveillance-sharing agreement with the CME—a U.S. regulated market whose bitcoin futures market is consistently highly correlated to spot bitcoin, albeit not of ‘‘significant size’’ related to spot bitcoin—can be reasonably expected to assist in surveilling for fraudulent and manipulative acts and practices in the specific context of the [Bitcoin ETPs].8 The Trust is structured and will operate in a manner materially the same as the Bitcoin ETPs. Accordingly, the Sponsor believes that, for the reasons set forth in the Bitcoin ETP Approval Order, listing and trading Shares of the Trust would be consistent with the requirements of the Act. Creation and Redemption of Shares The Trust issues and redeems ‘‘Baskets’’ on a continuous basis. Baskets are only created or redeemed in exchange for the amount of bitcoin represented by the Baskets being created or redeemed. Only ‘‘Authorized Participants’’ can initiate a creation or redemption of Baskets. Each Authorized Participant must be a registered brokerdealer, a participant in Depository Trust Company (‘‘DTC’’), have entered into an agreement with the Sponsor and be in a position to transfer cash to, and take delivery of cash from, the Cash Custodian through one or more accounts. The Trust issues and redeems Shares only in Baskets of 10,000 or integral multiples thereof, based on the quantity of bitcoin attributable to each Share (net of accrued but unpaid Sponsor’s Fee and any accrued but unpaid expenses or liabilities). Baskets may be redeemed by the Trust in exchange for the amount of bitcoin corresponding to their redemption value. Only Authorized Participants can initiate a creation or redemption of Baskets. The Authorized Participants will deliver only cash to create Shares and will receive only cash when redeeming Shares. Further, Authorized Participants will not directly or indirectly purchase, hold, deliver or receive bitcoin as part of the creation or redemption process or otherwise direct the Trust or a third party with respect to purchasing, holding, delivering or receiving bitcoin as part of the creation or redemption process. For a redemption in cash, the Sponsor shall arrange for the bitcoin represented by the creation Basket to be sold to the Liquidity Provider,9 and the 8 Bitcoin ETP Approval Order, 89 FR at 3009–11. Trust’s Liquidity Provider is Foris DAX, Inc. The Liquidity Provider facilitates the purchase and sale of bitcoin for creations or redemptions of Baskets in cash. 9 The E:\FR\FM\20JNN1.SGM 20JNN1 Federal Register / Vol. 90, No. 117 / Friday, June 20, 2025 / Notices ddrumheller on DSK120RN23PROD with NOTICES1 cash proceeds distributed from the Trust’s account at the Cash Custodian to the Authorized Participant. Baskets are only issued or redeemed in exchange for an amount of bitcoin determined by the Sponsor on each day that the Exchange is open for regular trading. No Shares are issued unless the Bitcoin Custodian or Prime Execution Agent has allocated to the Trust’s account the corresponding amount of bitcoin. Issuance of Baskets For a creation of Baskets, the Authorized Participant will be required to submit the purchase order by an early order cutoff time (the ‘‘Creation Early Order Cutoff Time’’) on the Business Day prior to the trade date. The Authorized Participant must submit a purchase order through an electronic order entry system, indicating the number of Baskets it intends to acquire. The date that order is received will determine the basket bitcoin amount (the ‘‘Basket Amount’’) the Trust needs to purchase from the Liquidity Provider or through the Prime Execution Agent. The final cash amounts will be determined after the NAV of the Trust is struck and the Trust’s bitcoin transactions have settled. The Basket Amount necessary for the creation of a Basket changes from day to day. On each Business Day, the Trust Administrator will adjust the quantity of bitcoin constituting the Basket Amount as appropriate to reflect sales of bitcoin, any loss of bitcoin that may occur and accrued expenses. The Basket Amount is determined for a given day by multiplying the NAV per Share by the number of Shares in each Basket and dividing the resulting product by that day’s Index price. The Basket Amount so determined will be made available to all Authorized Participants and the Liquidity Provider, and will be made available on the Sponsor’s website for the Shares. On the date of the Creation Early Order Cutoff Time, the Trust will choose, in its sole discretion, to enter into a transaction with the Liquidity Provider or the Prime Execution Agent to buy bitcoin in exchange for the cash proceeds from such purchase order. For settlement of a creation, the Trust delivers Shares to the Authorized Participant in exchange for cash received from the Authorized Participant. Meanwhile, the Liquidity Provider or Prime Execution Agent, as applicable, delivers the required bitcoin pursuant to its trade with the Trust into the Trust’s Trading Balance with the Prime Execution Agent in exchange for cash. VerDate Sep<11>2014 20:05 Jun 18, 2025 Jkt 265001 Upon the deposit by the Liquidity Provider or the Prime Execution Agent of the corresponding amount of bitcoin with the Trust’s Trading Balance, and of any expenses, taxes or charges, the Cash Custodian will deliver the appropriate number of Baskets to the DTC account of the depositing Authorized Participant. Because the Sponsor has assumed what are expected to be most of the Trust’s expenses, and the Sponsor’s Fee accrues daily at the same rate, in the absence of any extraordinary expenses or liabilities, the amount of bitcoin by which the Basket Amount will decrease each day will be predictable. The Sponsor intends to have the Trust Administrator make available on each Business Day an indicative Basket Amount for the next Business Day. Authorized Participants may use that indicative Basket Amount as guidance regarding the amount of cash that they may expect to have to deposit with the Trust Administrator in respect of purchase orders placed by them on such next Business Day and accepted by the Sponsor. The Sponsor may suspend the acceptance of purchase orders or the delivery or registration of transfers of Shares or may refuse a particular purchase order, delivery or registration of Shares (i) during any period when the transfer books of the Sponsor are closed or (ii) at any time, if the Sponsor thinks it advisable for any reason. The Sponsor will reject any purchase order or redemption order that is not in proper form. Redemption of Baskets For a redemption of Baskets, the Authorized Participant will be required to submit a redemption order by an early order cutoff time (the ‘‘Redemption Early Order Cutoff Time’’) on the Business Day prior to the trade date. On the date of the Redemption Early Order Cutoff Time, the Trust may choose, in its sole discretion, to enter into a transaction with the Liquidity Provider or the Prime Execution Agent, to sell bitcoin in exchange for cash. Also on the date of the Redemption Order Early Cutoff, the Trust instructs the Bitcoin Custodian to prepare to move the associated bitcoin from the Trust’s Vault Balance with the Bitcoin Custodian to the Trust’s Trading Balance with the Prime Execution Agent. For settlement of a redemption, the Authorized Participant delivers the necessary Shares to the Trust, the Liquidity Provider or the Prime Execution Agent, as applicable, delivers the cash to the Trust associated with the Trust’s sale of bitcoin, the Sponsor PO 00000 Frm 00104 Fmt 4703 Sfmt 4703 26369 delivers bitcoin to the Liquidity Provider’s account at the Prime Execution Agent or directly to the Prime Execution Agent, as applicable, and the Trust delivers cash to the Authorized Participant. Upon the surrender of Shares and the payment of applicable costs, expenses, taxes or charges by the redeeming Authorized Participant, and the completion of the sale of bitcoin for cash by the Trust, the Sponsor will instruct the delivery of cash to the Authorized Participant. The Authorized Participant is responsible for the dollar cost of the difference between the value of bitcoin calculated by the Trust Administrator for the applicable NAV per Share of the Trust and the price at which the Trust sells bitcoin to raise the cash needed for the cash redemption order to the extent the price realized in selling the bitcoin is lower than the bitcoin price utilized in the NAV. To the extent the price realized in selling the bitcoin is higher than the price utilized in the NAV, the Authorized Participant shall get to keep the dollar impact of any such difference. Shares can only be surrendered for redemption in Baskets of 10,000 Shares each. An Authorized Participant must submit a redemption order through an electronic order entry system, indicating the number of Baskets it intends to redeem. The date that order is received determines the Basket Amount to be received in exchange. All taxes incurred in connection with the delivery of bitcoin to the Bitcoin Custodian or cash to the Cash Custodian in exchange for Baskets (including any applicable value added tax) will be the sole responsibility of the Authorized Participant making such delivery. Redemptions may be suspended (1) during any period in which regular trading on NYSE Arca is suspended or restricted or the exchange is closed (other than scheduled holiday or weekend closings), or (2) during a period when the Sponsor determines that delivery, disposal or evaluation of bitcoin is not reasonably practicable. The Sponsor and the Trust Administrator will reject any redemption order that is not in proper form. If the Trust suspends redemptions, Shareholders will be notified in a prospectus supplement, in its periodic Exchange Act reports and/ or on the Trust’s website. Availability of Information The Trust’s website will include quantitative information on a per Share basis updated on a daily basis, including (i) the current NAV per Share daily and the prior Business Day’s NAV E:\FR\FM\20JNN1.SGM 20JNN1 ddrumheller on DSK120RN23PROD with NOTICES1 26370 Federal Register / Vol. 90, No. 117 / Friday, June 20, 2025 / Notices per Share and the reported closing price of the Shares; (ii) the mid-point of the bid-ask price 10 as of the time the NAV per Share is calculated (‘‘Bid-Ask Price’’) and a calculation of the premium or discount of such price against such NAV per Share; and (iii) data in chart format displaying the frequency distribution of discounts and premiums of the daily Bid-Ask Price against the NAV per Share, within appropriate ranges, for each of the four previous calendar quarters (or for as long as the Trust has been trading as an ETP if shorter). In addition, on each Business Day, the Trust’s website will provide pricing information for the Shares. The Trust Administrator will also disseminate the Trust’s holdings on a daily basis on the Trust’s website. The NAV per Share for the Trust will be calculated by the Trust Administrator once a day and will be disseminated daily to all market participants at the same time. Quotation and last sale information regarding the Shares will be disseminated through the facilities of the Consolidated Tape Association (the ‘‘CTA’’). The Sponsor will publish an intraday indicative value per Share (‘‘IIV’’) using the CME CF Bitcoin Real Time Index (‘‘BRTI’’). One or more major market data vendors will provide an IIV updated every 15 seconds, as calculated by the Exchange or a third-party financial data provider during the Exchange’s Core Trading Session (9:30 a.m. to 4:00 p.m. E.T.). The IIV will be calculated by using the prior day’s closing NAV per Share as a base and updating that value during the NYSE Arca Core Trading Session to reflect changes in the value of the Trust’s NAV per Share during the trading day. The IIV’s dissemination during the Core Trading Session should not be viewed as an actual real time update of the NAV per Share, which will be calculated only once at the end of each trading day. The IIV will be widely disseminated every 15 seconds during the Core Trading Session by one or more major market data vendors. In addition, the IIV will be available through online information services. Quotation and last sale information for bitcoin will be widely disseminated through a variety of major market data vendors, including Bloomberg and Reuters. In addition, real-time price (and volume) data for bitcoin is available by subscription from Reuters 10 The bid-ask price of the Trust is determined using the highest bid and lowest offer on the Consolidated Tape as of the time of calculation of the closing day NAV. VerDate Sep<11>2014 20:05 Jun 18, 2025 Jkt 265001 and Bloomberg. The spot price of bitcoin is available on a 24-hour basis from major market data vendors, including Bloomberg and Reuters. Information relating to trading, including price and volume information, in bitcoin will be available from major market data vendors and from the trading platforms on which bitcoin is traded. Trading Rules The Exchange deems the Shares to be equity securities, thus rendering trading in the Shares subject to the Exchange’s existing rules governing the trading of equity securities. Shares will trade on the NYSE Arca Marketplace from 4:00 a.m. to 8:00 p.m. E.T., in accordance with NYSE Arca Rule 7.34–E (Early, Core, and Late Trading Sessions). The Exchange has appropriate rules to facilitate transactions in the Shares during all trading sessions. As provided in NYSE Arca Rule 7.6–E, the minimum price variation (‘‘MPV’’) for quoting and entry of orders in equity securities traded on the NYSE Arca Marketplace is $0.01, with the exception of securities that are priced less than $1.00, for which the MPV for order entry is $0.0001. The Shares will be required to conform to the initial and continued listing criteria under NYSE Arca Rule 8.201–E. The trading of the Shares will be subject to NYSE Arca Rule 8.201– E(g), which sets forth certain restrictions on Equity Trading Permit Holders (‘‘ETP Holders’’) acting as registered market makers (‘‘Market Makers’’) in Commodity-Based Trust Shares to facilitate surveillance. The Exchange represents that, for initial and continued listing, the Trust is required to comply with Rule 10A–3 11 under the Act, as provided by NYSE Arca Rule 5.3–E. A minimum of 100,000 Shares of the Trust will be outstanding at the commencement of trading on the Exchange. Trading Halts With respect to trading halts, the Exchange may consider all relevant factors in exercising its discretion to halt or suspend trading in the Shares of the Trust.12 Trading in Shares of the Trust will be halted if the circuit breaker parameters in NYSE Arca Rule 7.12–E have been reached. Trading also may be halted because of market conditions or for reasons that, in the view of the Exchange, make trading in the Shares inadvisable. 11 17 CFR 240.10A–3. NYSE Arca Rule 7.12–E. 12 See PO 00000 Frm 00105 Fmt 4703 Sfmt 4703 The Exchange may halt trading during the day in which an interruption to the dissemination of the IIV or the value of the Index occurs. If the interruption to the dissemination of the IIV or the value of the Index persists past the trading day in which it occurred, the Exchange will halt trading no later than the beginning of the trading day following the interruption. In addition, if the Exchange becomes aware that the NAV per Share is not disseminated to all market participants at the same time, it will halt trading in the Shares until such time as the NAV per Share is available to all market participants. Surveillance The Exchange represents that trading in the Shares of the Trust on the Exchange will be subject to the existing trading surveillances administered by the Exchange, as well as cross-market surveillances administered by the Financial Industry Regulatory Authority (‘‘FINRA’’) on behalf of the Exchange, which are designed to detect potential violations of Exchange rules and applicable federal securities laws with respect to the Shares of the Trust trading on the Exchange.13 The Exchange represents that these procedures are adequate to properly monitor Exchange trading of the Shares in all trading sessions and to deter and detect violations of Exchange rules and federal securities laws with respect to the Shares of the Trust trading on the Exchange. The existing surveillances referred to above generally focus on detecting securities trading outside their normal trading patterns, which could be indicative of manipulative or other violative activity with respect to the Shares of the Trust. When such situations are detected, surveillance analysis follows and investigations are opened, where appropriate, to review the behavior of all relevant parties for all relevant trading violations. The Exchange or FINRA, on behalf of the Exchange, or both, will communicate as needed regarding trading in the Shares with other markets and other entities that are members of the Intermarket Surveillance Group (the ‘‘ISG’’), and the Exchange or FINRA, on behalf of the Exchange, or both, may obtain trading information regarding trading in the Shares and bitcoin derivatives from such markets and other entities. In addition, the Exchange may obtain information regarding trading in 13 FINRA conducts cross-market surveillances on behalf of the Exchange pursuant to a regulatory services agreement. The Exchange is responsible for FINRA’s performance under this regulatory services agreement. E:\FR\FM\20JNN1.SGM 20JNN1 ddrumheller on DSK120RN23PROD with NOTICES1 Federal Register / Vol. 90, No. 117 / Friday, June 20, 2025 / Notices the Shares and bitcoin derivatives from markets and other entities that are members of ISG or with which the Exchange has in place a comprehensive surveillance sharing agreement (‘‘CSSA’’).14 The Exchange is also able to obtain information from ETP Holders regarding their trading (as principal or agent) in the Shares and any underlying bitcoin, bitcoin futures contracts, options on bitcoin futures or any other bitcoin derivative. In addition, under NYSE Arca Rule 8.201–E(g), an ETP Holder acting as a registered Market Maker in the Shares is required to provide the Exchange with information relating to its accounts for trading in any underlying commodity, related futures or options on futures or any other related derivatives. Commentary .04 of NYSE Arca Rule 11.3–E requires an ETP Holder acting as a registered Market Maker, and its affiliates, in the Shares to establish, maintain and enforce written policies and procedures reasonably designed to prevent the misuse of any material nonpublic information with respect to such products, any components of the related products, any physical asset or commodity underlying the product, applicable currencies, underlying indexes, related futures or options on futures, and any related derivative instruments (including the Shares). As a general matter, the Exchange has regulatory jurisdiction over its ETP Holders and their associated persons, which include any person or entity controlling an ETP Holder. To the extent the Exchange may be found to lack jurisdiction over a subsidiary or affiliate of an ETP Holder that does business only in commodities or futures contracts and that subsidiary or affiliate is a member of another regulatory organization, the Exchange could obtain information regarding the activities of such subsidiary or affiliate through surveillance sharing agreements with that regulatory organization to the extent such agreements exist. In addition, the Exchange also has a general policy prohibiting the distribution of material, non-public information by its employees. All statements and representations made in this filing regarding (a) the description of the index, portfolio or reference asset, (b) limitations on index or portfolio holdings or reference assets or (c) the applicability of Exchange listing rules specified in this rule filing shall constitute continued listing requirements for listing the Shares on the Exchange. 14 For a list of the current members of ISG, see www.isgportal.org. VerDate Sep<11>2014 20:05 Jun 18, 2025 Jkt 265001 The Sponsor has represented to the Exchange that it will advise the Exchange if the Trust no longer complies with the continued listing requirements, and, pursuant to its obligations under Section 19(g)(1) of the Act, the Exchange will monitor for compliance with the continued listing requirements. If the Exchange becomes aware that the Trust is not in compliance with the applicable listing requirements, the Exchange will commence delisting procedures under NYSE Arca Rule 5.5–E(m). Information Bulletin Prior to the commencement of trading, the Exchange will inform its ETP Holders in an ‘‘Information Bulletin’’ of the special characteristics and risks associated with trading the Shares. Specifically, the Information Bulletin will discuss the following: (1) the procedures for creations of Shares in Baskets; (2) NYSE Arca Rule 9.2–E(a), which imposes a duty of due diligence on its ETP Holders to learn the essential facts relating to every customer prior to trading the Shares; (3) information regarding how the value of the Index and NAV are disseminated; (4) the possibility that trading spreads and the resulting premium or discount on the Shares may widen during the Early and Late Trading Sessions, when an updated IIV will not be calculated or publicly disseminated; (5) the requirement that members deliver a prospectus to investors purchasing newly issued Shares prior to or concurrently with the confirmation of a transaction; and (6) trading information. In addition, the Information Bulletin will reference that the Trust is subject to various fees and expenses as described in the Registration Statement. The Information Bulletin will disclose that information about the Shares of the Trust is publicly available on the Trust’s website. The Information Bulletin will also reference the fact that there is no regulated source of last sale information regarding bitcoin, that the Commission has no jurisdiction over the trading of bitcoin as a commodity, and that the Commodity Futures Trading Commission (the ‘‘CFTC’’) has regulatory jurisdiction over the trading of CME bitcoin futures contracts and options on CME bitcoin futures contracts. The Information Bulletin will also discuss any relief, if granted, by the Commission or the staff from any rules under the Act. 2. Statutory Basis The basis under the Act for this proposed rule change is the requirement PO 00000 Frm 00106 Fmt 4703 Sfmt 4703 26371 under Section 6(b)(5) 15 that an exchange have rules that are designed to prevent fraudulent and manipulative acts and practices, to promote just and equitable principles of trade, to remove impediments to, and perfect the mechanism of, a free and open market and, in general, to protect investors and the public interest. The Exchange believes that the proposed rule change is designed to prevent fraudulent and manipulative acts and practices in that the Shares will be listed and traded on the Exchange pursuant to the initial and continued listing criteria in NYSE Arca Rule 8.201–E. The Exchange has in place surveillance procedures that are adequate to properly monitor trading in the Shares in all trading sessions on the Exchange and to deter and detect violations of Exchange rules and applicable federal securities laws. The Exchange or FINRA, on behalf of the Exchange, or both, will communicate as needed regarding trading in the Shares with other markets that are members of the ISG, and the Exchange or FINRA, on behalf of the Exchange, or both, may obtain trading information regarding trading in the Shares and bitcoin derivatives from such markets. In addition, the Exchange may obtain information regarding trading in the Shares and bitcoin derivatives from markets that are members of ISG or with which the Exchange has in place a CSSA. Also, pursuant to NYSE Arca Rule 8.201–E(g), the Exchange is able to obtain information regarding Market Maker accounts for trading in the Shares and the underlying bitcoin or any bitcoin derivative through ETP Holders acting as registered Market Makers, in connection with such ETP Holders’ proprietary trades which they effect on any relevant market. The proposed rule change is also designed to prevent fraudulent and manipulative acts and practices because the Trust is structured similarly to and will operate in materially the same manner as the Bitcoin ETPs previously approved by the Commission. The Exchange further believes that the proposed rule change is designed to prevent fraudulent and manipulative acts and practices because, as noted by the Commission in the Bitcoin ETP Approval Order, the Exchange’s ability to obtain information regarding trading in the Shares and futures from markets and other entities that are members of the ISG (including the CME) would assist the Exchange in detecting and deterring misconduct. In particular, the CME bitcoin futures market is a large, 15 15 E:\FR\FM\20JNN1.SGM U.S.C. 78f(b)(5). 20JNN1 ddrumheller on DSK120RN23PROD with NOTICES1 26372 Federal Register / Vol. 90, No. 117 / Friday, June 20, 2025 / Notices surveilled and regulated market that is closely connected with the spot market for bitcoin and through which the Exchange could obtain information to assist in detecting and deterring potential fraud or manipulation. The proposed rule change is designed to promote just and equitable principles of trade and to protect investors and the public interest in that there is a considerable amount of bitcoin price and market information available on public websites and through professional and subscription services. Investors may obtain, on a 24-hour basis, bitcoin pricing information based on the spot price for bitcoin from various financial information service providers. The closing price and settlement prices of bitcoin are readily available from the Constituent Platforms and other publicly available websites. In addition, such prices are published in public sources, or on-line information services such as Bloomberg and Reuters. The NAV per Share will be calculated daily and made available to all market participants at the same time. The Trust will provide website disclosure of its NAV and NAV per Share daily. One or more major market data vendors will disseminate for the Trust on a daily basis information with respect to the most recent NAV per Share and Shares outstanding. In addition, if the Exchange becomes aware that the NAV per Share is not disseminated to all market participants at the same time, it will halt trading in the Shares until such time as the NAV per Share is available to all market participants. Quotation and last-sale information regarding the Shares will be disseminated through the facilities of the CTA. The IIV will be widely disseminated on a per Share basis every 15 seconds during the NYSE Arca Core Trading Session (normally 9:30 a.m. E.T. to 4:00 p.m. E.T.) by one or more major market data vendors. The Exchange represents that the Exchange may halt trading during the day in which an interruption to the dissemination of the IIV or the value of the Index occurs. If the interruption to the dissemination of the IIV or the value of the Index persists past the trading day in which it occurred, the Exchange will halt trading no later than the beginning of the trading day following the interruption. The proposed rule change is designed to perfect the mechanism of a free and open market and, in general, to protect investors and the public interest in that it will facilitate the listing and trading of an additional type of exchange-traded product that will enhance competition among market participants, to the benefit of investors and the marketplace. VerDate Sep<11>2014 20:05 Jun 18, 2025 Jkt 265001 As noted above, the Exchange has in place surveillance procedures relating to trading in the Shares on the Exchange and may obtain information via ISG from other exchanges that are members of ISG or with which the Exchange has entered into a CSSA. In addition, as noted above, investors will have ready access to information regarding the Trust’s NAV per Share, IIV, and quotation and last sale information for the Shares. 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. The Exchange notes that the proposed rule change will facilitate the listing and trading of an additional type of exchange-traded product, which will enhance competition among market participants, to the benefit of investors and the marketplace. C. Self-Regulatory Organization’s Statement on Comments on the Proposed Rule Change Received From Members, Participants, or Others No written comments were solicited or received with respect to the proposed rule change. III. Date of Effectiveness of the Proposed Rule Change and Timing for Commission Action 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 self-regulatory organization consents, the Commission will: (A) by order approve or disapprove the 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: NYSEARCA–2025–40 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–NYSEARCA–2025–40. 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–NYSEARCA–2025–40 and should be submitted on or before July 11, 2025. For the Commission, by the Division of Trading and Markets, pursuant to delegated authority.16 Sherry R. Haywood, Assistant Secretary. [FR Doc. 2025–11291 Filed 6–18–25; 8:45 am] BILLING CODE 8011–01–P 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– PO 00000 Frm 00107 Fmt 4703 Sfmt 9990 16 17 E:\FR\FM\20JNN1.SGM CFR 200.30–3(a)(12). 20JNN1

Agencies

SECURITIES AND EXCHANGE COMMISSION

[Federal Register Volume 90, Number 117 (Friday, June 20, 2025)]
[Notices]
[Pages 26365-26372]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2025-11291]

[[Page 26365]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-103261; File No. SR-NYSEARCA-2025-40]

Self-Regulatory Organizations; NYSE Arca, Inc.; Notice of Filing
of Proposed Rule Change To List and Trade Shares of the Truth Social
Bitcoin ETF, B.T. Under NYSE Arca Rule 8.201-E (Commodity-Based Trust
Shares)

June 16, 2025.
Pursuant to Section 19(b)(1) \1\ of the Securities Exchange Act of
1934 (``Act'') \2\ and Rule 19b-4 thereunder,\3\ notice is hereby given
that, on June 3, 2025, NYSE Arca, Inc. (``NYSE Arca'' or the
``Exchange'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I, II,
and III below, which Items have been prepared by the self-regulatory
organization. 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\ 15 U.S.C. 78a.
\3\ 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 list and trade shares of the following
under NYSE Arca Rule 8.201-E: Truth Social Bitcoin ETF, B.T. (the
``Trust''). The proposed rule change is available on the Exchange's
website at www.nyse.com, 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 self-regulatory organization
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 those 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 parts of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule Change

1. Purpose
Under NYSE Arca Rule 8.201-E, the Exchange may propose to list and/
or trade pursuant to unlisted trading privileges ``Commodity-Based
Trust Shares.'' \4\ The Exchange proposes to list and trade shares (the
``Shares'') of the Trust pursuant to NYSE Arca Rule 8.201-E.\5\
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\4\ Commodity-Based Trust Shares are securities issued by a
trust that represent investors' discrete identifiable and undivided
beneficial ownership interest in the commodities deposited into the
Trust.
\5\ The Trust expects to file a registration statement on Form
S-1 under the Securities Act (the ``Registration Statement''). The
descriptions of the Trust and Shares contained herein are based, in
part, on a draft of the Registration Statement. The Registration
Statement is not yet effective, and the Shares will not trade on the
Exchange until such time that the Registration Statement is
effective.
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The sponsor of the Trust is Yorkville America Digital, LLC (the
``Sponsor''), a Florida limited liability company.
The Trust is a Nevada business trust that operates pursuant to a
trust agreement (the ``Trust Agreement'') between the Sponsor and the
trustee for the Trust (the ``Trustee'').
The custodian for the Trust's bitcoin is Foris DAX Trust Company,
LLC (the ``Bitcoin Custodian''). The custodian for the Trust's cash is
referred to here as the ``Cash Custodian,'' the administrator and
transfer agent of the Trust as the ``Transfer Agent'' and its
administrator as the ``Trust Administrator.''
Each Share issued by the Trust represents a fractional undivided
beneficial interest in the net assets of the Trust. The assets of the
Trust consist primarily of bitcoin held by the Bitcoin Custodian on
behalf of the Trust.\6\
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\6\ From time to time, the Trust may be entitled to, or come
into possession of rights to acquire, or otherwise establish
dominion and control over, any virtual currency (for avoidance of
doubt, other than bitcoin) or other asset or right, which rights are
incident to the Trust's ownership of bitcoin and arise without any
action of the Trust, or of the Sponsor on behalf of the Trust
(``Incidental Rights'') and/or virtual currency tokens, or other
assets or rights, acquired by the Trust through the exercise
(subject to the applicable provisions of the Trust Agreement) of any
Incidental Right (``IR Digital Assets'') by virtue of its ownership
of bitcoin, generally through a fork in the Bitcoin Blockchain, an
airdrop offered to holders of bitcoin or other similar event. With
respect to a fork, airdrop or similar event, the Sponsor will cause
the Trust to permanently and irrevocably abandon the Incidental
Rights and IR Digital Assets. In the event the Trust seeks to change
this position, the Exchange would file a subsequent proposed rule
change with the Commission.
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Investment Objective
According to the Registration Statement, the Trust seeks to reflect
generally the performance of the price of bitcoin. The Trust seeks to
reflect such performance before payment of the Trust's expenses and
liabilities. The Shares are intended to constitute a simpler means of
making an investment similar to an investment in bitcoin rather than by
acquiring, holding and trading bitcoin directly on a peer-to-peer or
other basis or via a digital asset trading platform. The Shares have
been designed to remove the obstacles represented by the complexities
and operational burdens involved in a direct investment in bitcoin,
while at the same time having an intrinsic value that reflects, at any
given time, the investment exposure to the bitcoin owned by the Trust
at such time, less the Trust's expenses and liabilities. Although the
Shares are not the exact equivalent of a direct investment in bitcoin,
they provide investors with an alternative method of achieving
investment exposure to bitcoin through the securities market, which may
be more familiar to them.
Custody of the Trust's Bitcoin
The Bitcoin Custodian will keep custody of all of the Trust's
bitcoin, other than that which is maintained in a trading account (the
``Trading Balance'') with the prime execution agent for the Trust (the
``Prime Execution Agent''), in accounts that are required to be
segregated from the assets held by the Bitcoin Custodian as principal
and the assets of its other customers (the ``Vault Balance''). The
Bitcoin Custodian will keep all of the private keys associated with the
Trust's bitcoin held by the Bitcoin Custodian in the Vault Balance in
``cold storage,'' which refers to a safeguarding method by which the
private keys corresponding to the Trust's bitcoin are generated and
stored in an offline manner using computers or devices that are not
connected to the internet, which is intended to make them more
resistant to hacking.
The Sponsor represents that it will maintain ownership and control
of the Trust's bitcoin in a manner consistent with good delivery
requirements for spot commodity transactions.
Valuation of Bitcoin and Determination of NAV
The net asset value of the trust (the ``NAV'') will be equal to the
total assets of the Trust, which will consist solely of bitcoin and
cash, less total liabilities of the Trust.
In determining the NAV, the Trust Administrator values the bitcoin
held by the Trust based on the CF Benchmarks Index (the ``Index''),
unless otherwise

[[Page 26366]]

determined by the Sponsor in its sole discretion. If the Index is not
available or the Sponsor determines, in its sole discretion, that the
Index should not be used, the Trust's holdings may be fair valued in
accordance with policies approved by the Sponsor. If the Index is not
used, the Trust will notify the Exchange and its shareholders
(``Shareholders'') in a prospectus supplement, in its periodic Exchange
Act reports and/or on the Trust's website.
On each Business Day at 4:00 p.m. E.T., or as soon thereafter as
practicable, the Trust Administrator will evaluate the bitcoin held by
the Trust as reflected by the Index and determine the NAV and net asset
value per Share (``NAV per Share'') of the Trust. For purposes of
making these calculations, a ``Business Day'' means any day other than
a day when NYSE Arca is closed for regular trading.
According to the Registration Statement, the Index is designed
based on the IOSCO Principles for Financial Benchmarks and is a
registered benchmark under the U.K. Benchmark Regulations (``BMR'').
The administrator of the Index is CF Benchmarks Ltd. (the ``Index
Administrator''), a U.K. incorporated company, authorized and regulated
by the U.K. Financial Conduct Authority (the ``FCA'') as a benchmark
administrator, under U.K. BMR. The Index serves as a once-a-day
benchmark rate of the U.S. dollar price of bitcoin (``USD/BTC''),
calculated as of 4:00 p.m. E.T. The Index aggregates the trade flow of
several bitcoin platforms, during an observation window between 3:00
p.m. and 4:00 p.m. E.T. into the U.S. dollar price of one bitcoin at
4:00 p.m. E.T. Specifically, the Index is calculated based on the
``Relevant Transactions'' (as defined below) of all of its constituent
bitcoin platforms (collectively, the ``Constituent Platforms''), which
may change from time to time. A ``Relevant Transaction'' is any
cryptocurrency versus U.S. dollar spot trade that occurs during the
observation window between 3:00 p.m. and 4:00 p.m. E.T. on a
Constituent Platform in the BTC/USD pair that is reported and
disseminated by a Constituent Platform through its publicly available
Application Programming Interface (``API'') and observed by the Index
Administrator. The Index is calculated based on the Relevant
Transactions on the Constituent Platforms, as follows:
All Relevant Transactions are added to a joint list,
recording the time of execution and trade price for each transaction.
The list is partitioned by timestamp into 12 equally sized
time intervals of five minute length.
For each partition separately, the volume-weighted median
trade price is calculated from the trade prices and sizes of all
Relevant Transactions, i.e., across all Constituent Platforms.
The Index Administrator's Bitcoin Reference Rate (the
``Reference Rate'') is then determined by the equally weighted average
of the volume medians of all partitions.
According to the Registration Statement, Constituent Platforms are
selected by the Oversight Committee of the Index Administrator (the
``Oversight Committee''). A trading platform is eligible as a
Constituent Platform if it offers a market that facilitates the spot
trading of the relevant cryptocurrency base asset against the
corresponding quote asset, including markets where the quote asset is
made fungible with accepted assets (the ``Relevant Pair''), and makes
trade data and order data available through an API with sufficient
reliability, detail and timeliness, in the opinion of the Oversight
Committee.
As of March 31, 2025, the Constituent Platforms included in the
Index are as follows:
Crypto.com: A Singapore-based trading platform registered
as a money services business (``MSB'') with the U.S. Department of
Treasury's Financial Crimes Enforcement Network (``FinCEN'') and
licensed as a money transmitter in various U.S. states.
Bitstamp: A U.K.-based platform registered as an MSB with
FinCEN and licensed as a virtual currency business under the New York
Department of Financial Services (``NYDFS'') BitLicense regulation, as
well as a money transmitter in various U.S. states.
Bullish: A Gibraltar-based platform operated by Bullish
(GI) Limited and regulated by the Gibraltar Financial Services
Commission (``GFSC'') as a distributed ledger technology (``DLT'')
provider for execution and custody services.
Coinbase: A U.S.-based platform registered as an MSB with
FinCEN, licensed as a virtual currency business under the NYDFS
BitLicense regulation and licensed as a money transmitter in various
U.S. states.
Gemini: A U.S.-based platform that is licensed as a
virtual currency business under the NYDFS BitLicense regulation. Gemini
is also registered with FinCEN as an MSB and is licensed as a money
transmitter in various U.S. states.
itBit: A U.S.-based platform that is licensed as a virtual
currency business under the NYDFS BitLicense regulation. ItBit is also
registered with FinCEN as an MSB and is licensed as a money transmitter
in various U.S. states.
Kraken: A U.S.-based platform that is registered as an MSB
with FinCEN in various U.S. states. Kraken is also registered with the
FCA and is authorized by the Central Bank of Ireland as a virtual asset
service provider. Kraken also holds a variety of other licenses and
regulatory approvals, including those from the Japan Financial Services
Agency and the Canadian Securities Administrators.
LMAX Digital: A Gibraltar-based platform registered as an
MSB with FinCEN and regulated by the GFSC as a DLT provider for
execution and custody services. LMAX Digital is part of LMAX Group, a
U.K.-based operator of an FCA-regulated multilateral trading facility
and broker-dealer.
The Index is subject to the U.K. BMR regulations, compliance with
which has been subject to a Limited Assurance Audit under the ISAE 3000
standard as of September 12, 2022, and is administered under the CF
Benchmarks Control Framework to ensure compliance with U.K. BMR
regulations.
Bitcoin and the Bitcoin Network
Bitcoin is a digital asset that is created and transmitted through
the operations of the peer-to-peer network (the ``Bitcoin Network''), a
decentralized network of computers that operates pursuant to
cryptographic protocols. No single entity owns or operates the Bitcoin
Network, the infrastructure of which is collectively maintained by its
user base. The Bitcoin Network allows people to exchange tokens of
value, called bitcoin, which are recorded on a public transaction
ledger known as the ``Bitcoin Blockchain.'' Bitcoin can be used to pay
for goods and services, or it can be converted to fiat currencies, such
as the U.S. dollar, at rates determined on bitcoin platforms that
enable trading in bitcoin or in individual end-user-to-end-user
transactions under a barter system.
The Bitcoin Network is commonly understood to be decentralized and
does not require governmental authorities or financial institution
intermediaries to create, transmit or determine the value of bitcoin.
Rather, bitcoin is created and allocated by the Bitcoin Network's
cryptographic protocols through a ``mining'' process. The value of
bitcoin is determined by the supply of and demand for bitcoin on
bitcoin platforms or in private end-user-to-end-user transactions.
New bitcoin are created and rewarded to the miners of a block in
the Bitcoin Blockchain for verifying transactions.

[[Page 26367]]

The Bitcoin Blockchain is a shared database that includes all blocks
that have been added by miners, and it is updated to include new blocks
as they are added. Each bitcoin transaction is broadcast to the Bitcoin
Network and, when included in a block, recorded in the Bitcoin
Blockchain. As each new block records outstanding bitcoin transactions,
and outstanding transactions are settled and validated through such
recording, the Bitcoin Blockchain represents a complete, transparent
and unbroken history of all transactions of the Bitcoin Network.
Overview of the Bitcoin Network's Operations
In order to own, transfer or use bitcoin directly on the Bitcoin
Network (as opposed to through an intermediary, such as a trading
platform), a person generally must have internet access to connect to
the Bitcoin Network. Bitcoin transactions may be made directly between
end users without the need for a third-party intermediary. To prevent
the possibility of double-spending bitcoin, a user must notify the
Bitcoin Network of the transaction by broadcasting the transaction data
to its network peers. The Bitcoin Network provides confirmation against
double-spending by memorializing every transaction in the Bitcoin
Blockchain, which is publicly accessible and transparent. This
memorialization and verification against double-spending is
accomplished through the Bitcoin Network mining process, which adds
``blocks'' of data, including recent transaction information, to the
Bitcoin Blockchain.
Overview of Bitcoin Transfers
Prior to engaging in bitcoin transactions directly on the Bitcoin
Network, a user generally must first install on its computer or mobile
device a Bitcoin Network software program that will allow the user to
generate a private and public key pair associated with a bitcoin
address commonly referred to as a ``wallet.'' The Bitcoin Network
software program and the bitcoin address also enable the user to
connect to the Bitcoin Network and transfer bitcoin to, and receive
bitcoin from, other users.
Each Bitcoin Network address, or wallet, is associated with a
unique ``public key'' and ``private key'' pair. To receive bitcoin, the
bitcoin recipient must provide its public key to the party initiating
the transfer. This activity is analogous to a recipient for a
transaction in U.S. dollars providing a routing address in wire
instructions to the payor so that cash may be wired to the recipient's
account. The payor approves the transfer to the address provided by the
recipient by ``signing'' a transaction that consists of the recipient's
public key with the private key of the address from where the payor is
transferring the bitcoin. The recipient, however, does not make public
or provide to the sender its related private key.
Neither the recipient nor the sender reveals its private keys in a
transaction because the private key authorizes transfer of the funds in
that address to other users. Therefore, if a user loses his private
key, the user may permanently lose access to the bitcoin contained in
the associated address. When sending bitcoin, a user's Bitcoin Network
software program must validate the transaction with the associated
private key. The resulting digitally validated transaction is sent by
the user's Bitcoin Network software program to the Bitcoin Network to
allow transaction confirmation.
Some bitcoin transactions are conducted ``off-blockchain'' and are
therefore not recorded in the Bitcoin Blockchain. Some ``off-blockchain
transactions'' involve the transfer of control over, or ownership of, a
specific digital wallet holding bitcoin or the reallocation of
ownership of certain bitcoin in a digital wallet containing assets
owned by multiple persons, such as a digital wallet maintained by a
digital asset trading platform. In contrast to on-blockchain
transactions, which are publicly recorded on the Bitcoin Blockchain,
information and data regarding off-blockchain transactions are
generally not publicly available. Off-blockchain transactions do not
involve the transfer of transaction data on the Bitcoin Network and do
not reflect a movement of bitcoin between addresses recorded in the
Bitcoin Blockchain. For these reasons, off-blockchain transactions are
subject to risks as any such transfer of bitcoin ownership is not
protected by the protocol behind the Bitcoin Network or recorded in,
and validated through, the blockchain mechanism.
Summary of a Bitcoin Transaction
In a bitcoin transaction directly on the Bitcoin Network between
two parties (as opposed to through an intermediary, such as a platform
or a custodian), the following circumstances must initially be in
place: (i) the party seeking to send bitcoin must have a Bitcoin
Network public key, and the Bitcoin Network must recognize that public
key as having sufficient bitcoin for the transaction; (ii) the
receiving party must have a Bitcoin Network public key; and (iii) the
spending party must have internet access with which to send its
spending transaction.
The receiving party must provide the spending party with its public
key and allow the Bitcoin Blockchain to record the sending of bitcoin
to that public key. After the provision of a recipient's Bitcoin
Network public key, the spending party must enter the address into its
Bitcoin Network software program along with the number of bitcoin to be
sent. The number of bitcoin to be sent will typically be agreed upon
between the two parties based on a set number of bitcoin or an agreed-
upon conversion of the value of fiat currency to bitcoin.
Since every computation on the Bitcoin Network requires the payment
of bitcoin, including verification and memorialization of bitcoin
transfers, there is a transaction fee involved with the transfer, which
is based on computation complexity and not on the value of the transfer
and is paid by the payor with a fractional number of bitcoin.
After the entry of the Bitcoin Network address, the number of
bitcoin to be sent and the transaction fees, if any, to be paid, will
be transmitted by the spending party. The transmission of the spending
transaction results in the creation of a data packet by the spending
party's Bitcoin Network software program, which is transmitted onto the
Bitcoin Network, resulting in the distribution of the information among
the software programs of users across the Bitcoin Network for eventual
inclusion in the Bitcoin Blockchain.
Creation of a New Bitcoin
New bitcoin is created through the mining process.
The Bitcoin Network is kept running by computers all over the
world. In order to incentivize those who incur the computational costs
of securing the network by validating transactions, there is a reward
that is given to the computer that was able to create the latest block
on the chain. Every 10 minutes, on average, a new block is added to the
Bitcoin Blockchain with the latest transactions processed by the
network, and the computer that generated this block is currently
awarded 3.125 bitcoin. Due to the nature of the algorithm for block
generation, this process (called ``proof-of-work'' consensus) is
random. Over time, rewards are expected to be proportionate to the
computational power of each machine.
The process by which bitcoin is ``mined'' results in new blocks
being added to the Bitcoin Blockchain and new bitcoin tokens being
issued to the

[[Page 26368]]

miners. Computers on the Bitcoin Network engage in a set of prescribed
complex mathematical calculations in order to add a block to the
Bitcoin Blockchain and thereby confirm bitcoin transactions included in
that block's data.
To begin mining, a user can download and run Bitcoin Network mining
software, whereby the user's computer acts as a ``node'' on the Bitcoin
Network that validates blocks. Each block contains the details of some
or all of the most recent transactions that are not memorialized in
prior blocks, as well as a record of the award of bitcoin to the miner
who added the new block. Each unique block can be solved and added to
the Bitcoin Blockchain by only one miner. Therefore, all individual
miners and mining pools on the Bitcoin Network are engaged in a
competitive process of constantly seeking to increase their computing
power to improve their likelihood of solving for new blocks. As more
miners join the Bitcoin Network and its processing power increases, the
Bitcoin Network adjusts the complexity of the block-solving equation to
maintain a predetermined pace of adding a new block to the Bitcoin
Blockchain approximately every 10 minutes. A miner's proposed block is
added to the Bitcoin Blockchain once a majority of the nodes on the
Bitcoin Network confirms the miner's work. Miners that are successful
in adding a block to the Bitcoin Blockchain are automatically awarded
bitcoin for their effort and may also receive transaction fees paid by
transferors whose transactions are recorded in the block. This reward
system is the method by which new bitcoin enter circulation.
The Bitcoin Network is designed in such a way that the reward for
adding new blocks to the Bitcoin Blockchain decreases over time. More
specifically, the reward rate halves approximately every four years.
Once new bitcoin tokens are no longer awarded for adding a new block
(expected to occur in the year 2140), miners will only have transaction
fees to incentivize them, and as a result, it is expected that miners
will need to be better compensated with higher transaction fees to
ensure that there is adequate incentive for them to continue mining.
Limits on Bitcoin Supply
Under the source code that governs the Bitcoin Network, the supply
of new bitcoin is mathematically controlled so that the number of
bitcoin grows at a limited rate pursuant to a preset schedule. The
number of bitcoin awarded for solving a new block is automatically
halved after every 210,000 blocks are added to the Bitcoin Blockchain,
approximately every four years. Currently, the fixed reward for solving
a new block is 3.125 bitcoin per block, and this is expected to
decrease by half to become 1.5625 bitcoin in approximately mid-2028.
This deliberately controlled rate of bitcoin creation means that
the number of bitcoin in existence will increase at a controlled rate
until the number of bitcoin in existence reaches the predetermined 21
million bitcoin. However, the 21 million supply cap could be changed
pursuant to a hard fork. As of December 31, 2024, approximately 19.8
million bitcoin were outstanding and the date when the 21 million
bitcoin limitation will be reached is estimated to be the year 2140.
The Structure and Operation of the Trust Protects Investors and
Satisfies Commission Requirements for Bitcoin-Based Exchange-Traded
Products (``ETP'')
On January 10, 2024, the Commission approved the listing and
trading of shares of Grayscale Bitcoin Trust (BTC) and Bitwise Bitcoin
ETF under NYSE Arca Rule 8.201-E (Commodity-Based Trust Shares); the
Hashdex Bitcoin ETF under NYSE Arca Rule 8.500-E (Trust Units); the
iShares Bitcoin Trust and Valkyrie Bitcoin Fund under Nasdaq Rule
5711(d) (Commodity-Based Trust Shares); and the ARK 21Shares Bitcoin
ETF, Invesco Galaxy Bitcoin ETF, VanEck Bitcoin Trust, the WisdomTree
Bitcoin Fund, Fidelity Wise Origin Bitcoin Fund and Franklin Bitcoin
ETF under BZX Rule 14.11(e)(4) (Commodity-Based Trust Shares)
(collectively, the ``Bitcoin ETPs'').\7\ In the Bitcoin ETP Approval
Order, the Commission found that the proposed rule changes to list the
Bitcoin ETPs demonstrated that there were ``sufficient `other means' of
preventing fraud and manipulation,'' including that:
---------------------------------------------------------------------------

\7\ Securities Exchange Act Release No. 34-99306 (January 10,
2024), 89 FR 3008 (January 17, 2024) (SR-NYSEARCA-2021-90; SR-
NYSEARCA-2023-44; SRNYSEARCA-2023-58; SR-NASDAQ-2023-016; SR-NASDAQ-
2023-019; SR-CboeBZX-2023028; SR-CboeBZX-2023-038; SR-CboeBZX-2023-
040; SR-CboeBZX-2023-042; SRCboeBZX-2023-044; SR-CboeBZX-2023-072)
(Order Granting Accelerated Approval of Proposed Rule Changes, as
Modified by Amendments Thereto, to List and Trade Bitcoin-Based
Commodity-Based Trust Shares and Trust Units) (the ``Bitcoin ETP
Approval Order'').

[B]ased on the record before the Commission and the improved quality
of the correlation analysis in the record, including the
Commission's own analysis, the Commission is able to conclude that
fraud or manipulation that impacts prices in spot bitcoin markets
would likely similarly impact CME bitcoin futures prices. And
because the CME's surveillance can assist in detecting those impacts
on CME bitcoin futures prices, the Exchanges' comprehensive
surveillance-sharing agreement with the CME--a U.S. regulated market
whose bitcoin futures market is consistently highly correlated to
spot bitcoin, albeit not of ``significant size'' related to spot
bitcoin--can be reasonably expected to assist in surveilling for
fraudulent and manipulative acts and practices in the specific
context of the [Bitcoin ETPs].\8\
---------------------------------------------------------------------------

\8\ Bitcoin ETP Approval Order, 89 FR at 3009-11.

The Trust is structured and will operate in a manner materially the
same as the Bitcoin ETPs. Accordingly, the Sponsor believes that, for
the reasons set forth in the Bitcoin ETP Approval Order, listing and
trading Shares of the Trust would be consistent with the requirements
of the Act.
Creation and Redemption of Shares
The Trust issues and redeems ``Baskets'' on a continuous basis.
Baskets are only created or redeemed in exchange for the amount of
bitcoin represented by the Baskets being created or redeemed. Only
``Authorized Participants'' can initiate a creation or redemption of
Baskets. Each Authorized Participant must be a registered broker-
dealer, a participant in Depository Trust Company (``DTC''), have
entered into an agreement with the Sponsor and be in a position to
transfer cash to, and take delivery of cash from, the Cash Custodian
through one or more accounts.
The Trust issues and redeems Shares only in Baskets of 10,000 or
integral multiples thereof, based on the quantity of bitcoin
attributable to each Share (net of accrued but unpaid Sponsor's Fee and
any accrued but unpaid expenses or liabilities). Baskets may be
redeemed by the Trust in exchange for the amount of bitcoin
corresponding to their redemption value. Only Authorized Participants
can initiate a creation or redemption of Baskets.
The Authorized Participants will deliver only cash to create Shares
and will receive only cash when redeeming Shares. Further, Authorized
Participants will not directly or indirectly purchase, hold, deliver or
receive bitcoin as part of the creation or redemption process or
otherwise direct the Trust or a third party with respect to purchasing,
holding, delivering or receiving bitcoin as part of the creation or
redemption process. For a redemption in cash, the Sponsor shall arrange
for the bitcoin represented by the creation Basket to be sold to the
Liquidity Provider,\9\ and the

[[Page 26369]]

cash proceeds distributed from the Trust's account at the Cash
Custodian to the Authorized Participant.
---------------------------------------------------------------------------

\9\ The Trust's Liquidity Provider is Foris DAX, Inc. The
Liquidity Provider facilitates the purchase and sale of bitcoin for
creations or redemptions of Baskets in cash.
---------------------------------------------------------------------------

Baskets are only issued or redeemed in exchange for an amount of
bitcoin determined by the Sponsor on each day that the Exchange is open
for regular trading. No Shares are issued unless the Bitcoin Custodian
or Prime Execution Agent has allocated to the Trust's account the
corresponding amount of bitcoin.
Issuance of Baskets
For a creation of Baskets, the Authorized Participant will be
required to submit the purchase order by an early order cutoff time
(the ``Creation Early Order Cutoff Time'') on the Business Day prior to
the trade date. The Authorized Participant must submit a purchase order
through an electronic order entry system, indicating the number of
Baskets it intends to acquire. The date that order is received will
determine the basket bitcoin amount (the ``Basket Amount'') the Trust
needs to purchase from the Liquidity Provider or through the Prime
Execution Agent. The final cash amounts will be determined after the
NAV of the Trust is struck and the Trust's bitcoin transactions have
settled.
The Basket Amount necessary for the creation of a Basket changes
from day to day. On each Business Day, the Trust Administrator will
adjust the quantity of bitcoin constituting the Basket Amount as
appropriate to reflect sales of bitcoin, any loss of bitcoin that may
occur and accrued expenses. The Basket Amount is determined for a given
day by multiplying the NAV per Share by the number of Shares in each
Basket and dividing the resulting product by that day's Index price.
The Basket Amount so determined will be made available to all
Authorized Participants and the Liquidity Provider, and will be made
available on the Sponsor's website for the Shares.
On the date of the Creation Early Order Cutoff Time, the Trust will
choose, in its sole discretion, to enter into a transaction with the
Liquidity Provider or the Prime Execution Agent to buy bitcoin in
exchange for the cash proceeds from such purchase order. For settlement
of a creation, the Trust delivers Shares to the Authorized Participant
in exchange for cash received from the Authorized Participant.
Meanwhile, the Liquidity Provider or Prime Execution Agent, as
applicable, delivers the required bitcoin pursuant to its trade with
the Trust into the Trust's Trading Balance with the Prime Execution
Agent in exchange for cash.
Upon the deposit by the Liquidity Provider or the Prime Execution
Agent of the corresponding amount of bitcoin with the Trust's Trading
Balance, and of any expenses, taxes or charges, the Cash Custodian will
deliver the appropriate number of Baskets to the DTC account of the
depositing Authorized Participant.
Because the Sponsor has assumed what are expected to be most of the
Trust's expenses, and the Sponsor's Fee accrues daily at the same rate,
in the absence of any extraordinary expenses or liabilities, the amount
of bitcoin by which the Basket Amount will decrease each day will be
predictable. The Sponsor intends to have the Trust Administrator make
available on each Business Day an indicative Basket Amount for the next
Business Day. Authorized Participants may use that indicative Basket
Amount as guidance regarding the amount of cash that they may expect to
have to deposit with the Trust Administrator in respect of purchase
orders placed by them on such next Business Day and accepted by the
Sponsor.
The Sponsor may suspend the acceptance of purchase orders or the
delivery or registration of transfers of Shares or may refuse a
particular purchase order, delivery or registration of Shares (i)
during any period when the transfer books of the Sponsor are closed or
(ii) at any time, if the Sponsor thinks it advisable for any reason.
The Sponsor will reject any purchase order or redemption order that is
not in proper form.
Redemption of Baskets
For a redemption of Baskets, the Authorized Participant will be
required to submit a redemption order by an early order cutoff time
(the ``Redemption Early Order Cutoff Time'') on the Business Day prior
to the trade date. On the date of the Redemption Early Order Cutoff
Time, the Trust may choose, in its sole discretion, to enter into a
transaction with the Liquidity Provider or the Prime Execution Agent,
to sell bitcoin in exchange for cash. Also on the date of the
Redemption Order Early Cutoff, the Trust instructs the Bitcoin
Custodian to prepare to move the associated bitcoin from the Trust's
Vault Balance with the Bitcoin Custodian to the Trust's Trading Balance
with the Prime Execution Agent. For settlement of a redemption, the
Authorized Participant delivers the necessary Shares to the Trust, the
Liquidity Provider or the Prime Execution Agent, as applicable,
delivers the cash to the Trust associated with the Trust's sale of
bitcoin, the Sponsor delivers bitcoin to the Liquidity Provider's
account at the Prime Execution Agent or directly to the Prime Execution
Agent, as applicable, and the Trust delivers cash to the Authorized
Participant.
Upon the surrender of Shares and the payment of applicable costs,
expenses, taxes or charges by the redeeming Authorized Participant, and
the completion of the sale of bitcoin for cash by the Trust, the
Sponsor will instruct the delivery of cash to the Authorized
Participant. The Authorized Participant is responsible for the dollar
cost of the difference between the value of bitcoin calculated by the
Trust Administrator for the applicable NAV per Share of the Trust and
the price at which the Trust sells bitcoin to raise the cash needed for
the cash redemption order to the extent the price realized in selling
the bitcoin is lower than the bitcoin price utilized in the NAV. To the
extent the price realized in selling the bitcoin is higher than the
price utilized in the NAV, the Authorized Participant shall get to keep
the dollar impact of any such difference. Shares can only be
surrendered for redemption in Baskets of 10,000 Shares each.
An Authorized Participant must submit a redemption order through an
electronic order entry system, indicating the number of Baskets it
intends to redeem. The date that order is received determines the
Basket Amount to be received in exchange.
All taxes incurred in connection with the delivery of bitcoin to
the Bitcoin Custodian or cash to the Cash Custodian in exchange for
Baskets (including any applicable value added tax) will be the sole
responsibility of the Authorized Participant making such delivery.
Redemptions may be suspended (1) during any period in which regular
trading on NYSE Arca is suspended or restricted or the exchange is
closed (other than scheduled holiday or weekend closings), or (2)
during a period when the Sponsor determines that delivery, disposal or
evaluation of bitcoin is not reasonably practicable. The Sponsor and
the Trust Administrator will reject any redemption order that is not in
proper form. If the Trust suspends redemptions, Shareholders will be
notified in a prospectus supplement, in its periodic Exchange Act
reports and/or on the Trust's website.
Availability of Information
The Trust's website will include quantitative information on a per
Share basis updated on a daily basis, including (i) the current NAV per
Share daily and the prior Business Day's NAV

[[Page 26370]]

per Share and the reported closing price of the Shares; (ii) the mid-
point of the bid-ask price \10\ as of the time the NAV per Share is
calculated (``Bid-Ask Price'') and a calculation of the premium or
discount of such price against such NAV per Share; and (iii) data in
chart format displaying the frequency distribution of discounts and
premiums of the daily Bid-Ask Price against the NAV per Share, within
appropriate ranges, for each of the four previous calendar quarters (or
for as long as the Trust has been trading as an ETP if shorter). In
addition, on each Business Day, the Trust's website will provide
pricing information for the Shares.
---------------------------------------------------------------------------

\10\ The bid-ask price of the Trust is determined using the
highest bid and lowest offer on the Consolidated Tape as of the time
of calculation of the closing day NAV.
---------------------------------------------------------------------------

The Trust Administrator will also disseminate the Trust's holdings
on a daily basis on the Trust's website. The NAV per Share for the
Trust will be calculated by the Trust Administrator once a day and will
be disseminated daily to all market participants at the same time.
Quotation and last sale information regarding the Shares will be
disseminated through the facilities of the Consolidated Tape
Association (the ``CTA'').
The Sponsor will publish an intraday indicative value per Share
(``IIV'') using the CME CF Bitcoin Real Time Index (``BRTI''). One or
more major market data vendors will provide an IIV updated every 15
seconds, as calculated by the Exchange or a third-party financial data
provider during the Exchange's Core Trading Session (9:30 a.m. to 4:00
p.m. E.T.). The IIV will be calculated by using the prior day's closing
NAV per Share as a base and updating that value during the NYSE Arca
Core Trading Session to reflect changes in the value of the Trust's NAV
per Share during the trading day.
The IIV's dissemination during the Core Trading Session should not
be viewed as an actual real time update of the NAV per Share, which
will be calculated only once at the end of each trading day. The IIV
will be widely disseminated every 15 seconds during the Core Trading
Session by one or more major market data vendors. In addition, the IIV
will be available through online information services.
Quotation and last sale information for bitcoin will be widely
disseminated through a variety of major market data vendors, including
Bloomberg and Reuters. In addition, real-time price (and volume) data
for bitcoin is available by subscription from Reuters and Bloomberg.
The spot price of bitcoin is available on a 24-hour basis from major
market data vendors, including Bloomberg and Reuters. Information
relating to trading, including price and volume information, in bitcoin
will be available from major market data vendors and from the trading
platforms on which bitcoin is traded.
Trading Rules
The Exchange deems the Shares to be equity securities, thus
rendering trading in the Shares subject to the Exchange's existing
rules governing the trading of equity securities. Shares will trade on
the NYSE Arca Marketplace from 4:00 a.m. to 8:00 p.m. E.T., in
accordance with NYSE Arca Rule 7.34-E (Early, Core, and Late Trading
Sessions). The Exchange has appropriate rules to facilitate
transactions in the Shares during all trading sessions. As provided in
NYSE Arca Rule 7.6-E, the minimum price variation (``MPV'') for quoting
and entry of orders in equity securities traded on the NYSE Arca
Marketplace is $0.01, with the exception of securities that are priced
less than $1.00, for which the MPV for order entry is $0.0001.
The Shares will be required to conform to the initial and continued
listing criteria under NYSE Arca Rule 8.201-E. The trading of the
Shares will be subject to NYSE Arca Rule 8.201-E(g), which sets forth
certain restrictions on Equity Trading Permit Holders (``ETP Holders'')
acting as registered market makers (``Market Makers'') in Commodity-
Based Trust Shares to facilitate surveillance. The Exchange represents
that, for initial and continued listing, the Trust is required to
comply with Rule 10A-3 \11\ under the Act, as provided by NYSE Arca
Rule 5.3-E. A minimum of 100,000 Shares of the Trust will be
outstanding at the commencement of trading on the Exchange.
---------------------------------------------------------------------------

\11\ 17 CFR 240.10A-3.
---------------------------------------------------------------------------

Trading Halts
With respect to trading halts, the Exchange may consider all
relevant factors in exercising its discretion to halt or suspend
trading in the Shares of the Trust.\12\ Trading in Shares of the Trust
will be halted if the circuit breaker parameters in NYSE Arca Rule
7.12-E have been reached. Trading also may be halted because of market
conditions or for reasons that, in the view of the Exchange, make
trading in the Shares inadvisable.
---------------------------------------------------------------------------

\12\ See NYSE Arca Rule 7.12-E.
---------------------------------------------------------------------------

The Exchange may halt trading during the day in which an
interruption to the dissemination of the IIV or the value of the Index
occurs. If the interruption to the dissemination of the IIV or the
value of the Index persists past the trading day in which it occurred,
the Exchange will halt trading no later than the beginning of the
trading day following the interruption. In addition, if the Exchange
becomes aware that the NAV per Share is not disseminated to all market
participants at the same time, it will halt trading in the Shares until
such time as the NAV per Share is available to all market participants.
Surveillance
The Exchange represents that trading in the Shares of the Trust on
the Exchange will be subject to the existing trading surveillances
administered by the Exchange, as well as cross-market surveillances
administered by the Financial Industry Regulatory Authority (``FINRA'')
on behalf of the Exchange, which are designed to detect potential
violations of Exchange rules and applicable federal securities laws
with respect to the Shares of the Trust trading on the Exchange.\13\
The Exchange represents that these procedures are adequate to properly
monitor Exchange trading of the Shares in all trading sessions and to
deter and detect violations of Exchange rules and federal securities
laws with respect to the Shares of the Trust trading on the Exchange.
---------------------------------------------------------------------------

\13\ FINRA conducts cross-market surveillances on behalf of the
Exchange pursuant to a regulatory services agreement. The Exchange
is responsible for FINRA's performance under this regulatory
services agreement.
---------------------------------------------------------------------------

The existing surveillances referred to above generally focus on
detecting securities trading outside their normal trading patterns,
which could be indicative of manipulative or other violative activity
with respect to the Shares of the Trust. When such situations are
detected, surveillance analysis follows and investigations are opened,
where appropriate, to review the behavior of all relevant parties for
all relevant trading violations.
The Exchange or FINRA, on behalf of the Exchange, or both, will
communicate as needed regarding trading in the Shares with other
markets and other entities that are members of the Intermarket
Surveillance Group (the ``ISG''), and the Exchange or FINRA, on behalf
of the Exchange, or both, may obtain trading information regarding
trading in the Shares and bitcoin derivatives from such markets and
other entities. In addition, the Exchange may obtain information
regarding trading in

[[Page 26371]]

the Shares and bitcoin derivatives from markets and other entities that
are members of ISG or with which the Exchange has in place a
comprehensive surveillance sharing agreement (``CSSA'').\14\ The
Exchange is also able to obtain information from ETP Holders regarding
their trading (as principal or agent) in the Shares and any underlying
bitcoin, bitcoin futures contracts, options on bitcoin futures or any
other bitcoin derivative.
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\14\ For a list of the current members of ISG, see
www.isgportal.org.
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In addition, under NYSE Arca Rule 8.201-E(g), an ETP Holder acting
as a registered Market Maker in the Shares is required to provide the
Exchange with information relating to its accounts for trading in any
underlying commodity, related futures or options on futures or any
other related derivatives. Commentary .04 of NYSE Arca Rule 11.3-E
requires an ETP Holder acting as a registered Market Maker, and its
affiliates, in the Shares to establish, maintain and enforce written
policies and procedures reasonably designed to prevent the misuse of
any material nonpublic information with respect to such products, any
components of the related products, any physical asset or commodity
underlying the product, applicable currencies, underlying indexes,
related futures or options on futures, and any related derivative
instruments (including the Shares). As a general matter, the Exchange
has regulatory jurisdiction over its ETP Holders and their associated
persons, which include any person or entity controlling an ETP Holder.
To the extent the Exchange may be found to lack jurisdiction over a
subsidiary or affiliate of an ETP Holder that does business only in
commodities or futures contracts and that subsidiary or affiliate is a
member of another regulatory organization, the Exchange could obtain
information regarding the activities of such subsidiary or affiliate
through surveillance sharing agreements with that regulatory
organization to the extent such agreements exist.
In addition, the Exchange also has a general policy prohibiting the
distribution of material, non-public information by its employees.
All statements and representations made in this filing regarding
(a) the description of the index, portfolio or reference asset, (b)
limitations on index or portfolio holdings or reference assets or (c)
the applicability of Exchange listing rules specified in this rule
filing shall constitute continued listing requirements for listing the
Shares on the Exchange.
The Sponsor has represented to the Exchange that it will advise the
Exchange if the Trust no longer complies with the continued listing
requirements, and, pursuant to its obligations under Section 19(g)(1)
of the Act, the Exchange will monitor for compliance with the continued
listing requirements. If the Exchange becomes aware that the Trust is
not in compliance with the applicable listing requirements, the
Exchange will commence delisting procedures under NYSE Arca Rule 5.5-
E(m).
Information Bulletin
Prior to the commencement of trading, the Exchange will inform its
ETP Holders in an ``Information Bulletin'' of the special
characteristics and risks associated with trading the Shares.
Specifically, the Information Bulletin will discuss the following: (1)
the procedures for creations of Shares in Baskets; (2) NYSE Arca Rule
9.2-E(a), which imposes a duty of due diligence on its ETP Holders to
learn the essential facts relating to every customer prior to trading
the Shares; (3) information regarding how the value of the Index and
NAV are disseminated; (4) the possibility that trading spreads and the
resulting premium or discount on the Shares may widen during the Early
and Late Trading Sessions, when an updated IIV will not be calculated
or publicly disseminated; (5) the requirement that members deliver a
prospectus to investors purchasing newly issued Shares prior to or
concurrently with the confirmation of a transaction; and (6) trading
information.
In addition, the Information Bulletin will reference that the Trust
is subject to various fees and expenses as described in the
Registration Statement. The Information Bulletin will disclose that
information about the Shares of the Trust is publicly available on the
Trust's website. The Information Bulletin will also reference the fact
that there is no regulated source of last sale information regarding
bitcoin, that the Commission has no jurisdiction over the trading of
bitcoin as a commodity, and that the Commodity Futures Trading
Commission (the ``CFTC'') has regulatory jurisdiction over the trading
of CME bitcoin futures contracts and options on CME bitcoin futures
contracts.
The Information Bulletin will also discuss any relief, if granted,
by the Commission or the staff from any rules under the Act.
2. Statutory Basis
The basis under the Act for this proposed rule change is the
requirement under Section 6(b)(5) \15\ that an exchange have rules that
are designed to prevent fraudulent and manipulative acts and practices,
to promote just and equitable principles of trade, to remove
impediments to, and perfect the mechanism of, a free and open market
and, in general, to protect investors and the public interest.
---------------------------------------------------------------------------

\15\ 15 U.S.C. 78f(b)(5).
---------------------------------------------------------------------------

The Exchange believes that the proposed rule change is designed to
prevent fraudulent and manipulative acts and practices in that the
Shares will be listed and traded on the Exchange pursuant to the
initial and continued listing criteria in NYSE Arca Rule 8.201-E. The
Exchange has in place surveillance procedures that are adequate to
properly monitor trading in the Shares in all trading sessions on the
Exchange and to deter and detect violations of Exchange rules and
applicable federal securities laws. The Exchange or FINRA, on behalf of
the Exchange, or both, will communicate as needed regarding trading in
the Shares with other markets that are members of the ISG, and the
Exchange or FINRA, on behalf of the Exchange, or both, may obtain
trading information regarding trading in the Shares and bitcoin
derivatives from such markets. In addition, the Exchange may obtain
information regarding trading in the Shares and bitcoin derivatives
from markets that are members of ISG or with which the Exchange has in
place a CSSA. Also, pursuant to NYSE Arca Rule 8.201-E(g), the Exchange
is able to obtain information regarding Market Maker accounts for
trading in the Shares and the underlying bitcoin or any bitcoin
derivative through ETP Holders acting as registered Market Makers, in
connection with such ETP Holders' proprietary trades which they effect
on any relevant market.
The proposed rule change is also designed to prevent fraudulent and
manipulative acts and practices because the Trust is structured
similarly to and will operate in materially the same manner as the
Bitcoin ETPs previously approved by the Commission. The Exchange
further believes that the proposed rule change is designed to prevent
fraudulent and manipulative acts and practices because, as noted by the
Commission in the Bitcoin ETP Approval Order, the Exchange's ability to
obtain information regarding trading in the Shares and futures from
markets and other entities that are members of the ISG (including the
CME) would assist the Exchange in detecting and deterring misconduct.
In particular, the CME bitcoin futures market is a large,

[[Page 26372]]

surveilled and regulated market that is closely connected with the spot
market for bitcoin and through which the Exchange could obtain
information to assist in detecting and deterring potential fraud or
manipulation.
The proposed rule change is designed to promote just and equitable
principles of trade and to protect investors and the public interest in
that there is a considerable amount of bitcoin price and market
information available on public websites and through professional and
subscription services. Investors may obtain, on a 24-hour basis,
bitcoin pricing information based on the spot price for bitcoin from
various financial information service providers. The closing price and
settlement prices of bitcoin are readily available from the Constituent
Platforms and other publicly available websites.
In addition, such prices are published in public sources, or on-
line information services such as Bloomberg and Reuters. The NAV per
Share will be calculated daily and made available to all market
participants at the same time. The Trust will provide website
disclosure of its NAV and NAV per Share daily. One or more major market
data vendors will disseminate for the Trust on a daily basis
information with respect to the most recent NAV per Share and Shares
outstanding. In addition, if the Exchange becomes aware that the NAV
per Share is not disseminated to all market participants at the same
time, it will halt trading in the Shares until such time as the NAV per
Share is available to all market participants. Quotation and last-sale
information regarding the Shares will be disseminated through the
facilities of the CTA. The IIV will be widely disseminated on a per
Share basis every 15 seconds during the NYSE Arca Core Trading Session
(normally 9:30 a.m. E.T. to 4:00 p.m. E.T.) by one or more major market
data vendors. The Exchange represents that the Exchange may halt
trading during the day in which an interruption to the dissemination of
the IIV or the value of the Index occurs. If the interruption to the
dissemination of the IIV or the value of the Index persists past the
trading day in which it occurred, the Exchange will halt trading no
later than the beginning of the trading day following the interruption.
The proposed rule change is designed to perfect the mechanism of a
free and open market and, in general, to protect investors and the
public interest in that it will facilitate the listing and trading of
an additional type of exchange-traded product that will enhance
competition among market participants, to the benefit of investors and
the marketplace. As noted above, the Exchange has in place surveillance
procedures relating to trading in the Shares on the Exchange and may
obtain information via ISG from other exchanges that are members of ISG
or with which the Exchange has entered into a CSSA. In addition, as
noted above, investors will have ready access to information regarding
the Trust's NAV per Share, IIV, and quotation and last sale information
for the Shares.

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. The Exchange notes that the
proposed rule change will facilitate the listing and trading of an
additional type of exchange-traded product, which will enhance
competition among market participants, to the benefit of investors and
the marketplace.

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

No written comments were solicited or received with respect to the
proposed rule change.

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

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 self-regulatory organization consents, the Commission will:
(A) by order approve or disapprove the 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-NYSEARCA-2025-40 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-NYSEARCA-2025-40. 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-NYSEARCA-2025-40 and should
be submitted on or before July 11, 2025.

For the Commission, by the Division of Trading and Markets, pursuant
to delegated authority.\16\
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\16\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2025-11291 Filed 6-18-25; 8:45 am]
BILLING CODE 8011-01-P

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