Notice2024-17843
Self-Regulatory Organizations; Nasdaq ISE, LLC; Notice of Filing of Proposed Rule Change To Amend ISE Options 4, Section 3 To List and Trade Options on Units That Represent Interests in a Trust That Holds Ether (“Ether ETPs”)
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
August 12, 2024
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 89 Issue 155 (Monday, August 12, 2024)</title>
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[Federal Register Volume 89, Number 155 (Monday, August 12, 2024)]
[Notices]
[Pages 65685-65689]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2024-17843]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-100663; File No. SR-ISE-2024-34]
Self-Regulatory Organizations; Nasdaq ISE, LLC; Notice of Filing
of Proposed Rule Change To Amend ISE Options 4, Section 3 To List and
Trade Options on Units That Represent Interests in a Trust That Holds
Ether (``Ether ETPs'')
August 6, 2024.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act'' or ``Exchange Act''),\1\ and Rule 19b-4 thereunder,\2\ notice
is hereby given that on July 22, 2024, Nasdaq ISE, LLC (``ISE'' or
``Exchange'') filed with the Securities and Exchange Commission
(``Commission'') the proposed rule change as described in Items I and
II below, which Items have been prepared by the Exchange. The
Commission is publishing this notice to solicit comments on the
proposed rule change from interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
The Exchange to [sic] amend Options 4, Section 3, Criteria for
Underlying Securities.
The text of the proposed rule change is available on the Exchange's
website at <a href="https://listingcenter.nasdaq.com/rulebook/ise/rules">https://listingcenter.nasdaq.com/rulebook/ise/rules</a>, at the
principal office of the Exchange, and at the Commission's Public
Reference Room.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant aspects of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to amend Options 4, Section 3, Criteria for
Underlying Securities. Specifically, the Exchange proposes to amend
Options 4, Section 3(h) to allow the Exchange to list and trade options
on units that represent interests in a trust that hold ether (``Ether
ETPs''), designating them as Exchange-Traded Fund Shares (``ETFs'')
deemed appropriate for options trading on the Exchange. Options 4,
Section 3(h) provides that, subject to certain other criteria set forth
in that Rule, securities deemed appropriate for options trading include
ETFs that represent certain types of interests,\3\ including interests
in certain specific trusts that hold financial instruments, money
market instruments, or precious metals (which are deemed
commodities).\4\
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\3\ Options 4, Section 3(h) provides that securities deemed
appropriate for options trading shall include shares or other
securities (``Exchange-Traded Fund Shares'' or ``ETFs'') that are
traded on a national securities exchange and are defined as an
``NMS'' stock under Rule 600 of Regulation NMS, and that meet
certain criteria specified in Options 4, Section 3(h), including
that they: . . . (iv) represent interests in the SPDR[supreg] Gold
Trust, the iShares COMEX Gold Trust, the iShares Silver Trust, or
the ETFS Gold Trust . . .''. In addition to the aforementioned
requirements, Options 4, Section 3(h)(1) and (2) must be met to list
options on ETFs.
\4\ The Commission recently approved a rule change to list and
trade shares of the Trust pursuant to Rule 5711(d) of The Nasdaq
Stock Exchange LLC (``Commodity-Based Trust Shares''). See
Securities Exchange Act Release No. 100224 (May 23, 2024), 89 FR
46937 (May 30, 2024) (SR-NASDAQ-2023-045) (hereinafter ``SR-NASDAQ-
2023-045''). The Exchange represents it would not list options on a
trust unless it satisfied all applicable criteria in Options 4,
Section 3.
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Ether ETPs are ether-backed commodity ETPs structured as trusts.\5\
Similar to any ETF currently deemed appropriate for options trading
under Options 4, Section 3(h), the investment objective of an Ether ETP
trust is to reflect generally the performance of the price of ether
(before payment of the trust's expenses and liabilities), offering
investors an opportunity to gain exposure to ether without the
complexities of ether delivery. As is the case for ETFs currently
deemed appropriate for options trading, a [sic] Ether ETP's shares
represent units of fractional undivided beneficial interest in the
trust, the assets of which consist principally of ether and are
designed to track ether or the performance of the price of ether and
offer access to the ether market.\6\ Ether ETPs provide investors with
cost-efficient alternatives that allow a level of participation in the
ether market through the securities market. The primary substantive
difference between Ether ETPS and ETFs currently deemed appropriate for
[[Page 65686]]
options trading are that ETFs may hold securities, certain financial
instruments, and specified precious metals (which are commodities),
while Ether ETPS hold ether (which is also deemed a commodity).
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\5\ Pursuant to Options 4, Section 3(a), the Exchange would only
have authority to list and trade ETFs that are trading as NMS
stocks.
\6\ The trust may include minimal cash.
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The Exchange's initial listing standards for ETFs on which options
may be listed and traded on the Exchange will apply to the Ether ETPS.
The Exchange expects Ether ETPS to satisfy the initial listing
standards as set forth in Options 4, Section 3(a) and Options 4,
Section 3(h). Pursuant to Options 4, Section 3(a), a security (which
includes an ETF) on which options may be listed and traded on the
Exchange must be a security registered (with the Commission) and be an
NMS stock (as defined in Rule 600 of Regulation NMS under the Act), and
the security shall be characterized by a substantial number of
outstanding shares that are widely held and actively traded.\7\ Options
4, Section 3(h)(1) requires that ETFs must either meet the criteria and
guidelines set forth in Options 4, Section 3(a) and (b) \8\ or the ETFs
are available for creation or redemption each business day from or
through the issuing trust, investment company, commodity pool or other
entity in cash or in kind at a price related to net asset value, and
the issuer is obligated to issue ETFs in a specified aggregate number
even if some or all of the investment assets and/or cash required to be
deposited have not been received by the issuer, subject to the
condition that the person obligated to deposit the investment assets
has undertaken to deliver them as soon as possible and such undertaking
is secured by the delivery and maintenance of collateral consisting of
cash or cash equivalents satisfactory to the issuer of the ETFs, all as
described in the ETFs' prospectus or the Exchange-Traded Fund Shares
must be based on international or global indexes, or portfolios that
include non-U.S. securities, and meet other criteria. The Exchange
expects that Ether ETPS would satisfy Options 4, Section 3(h)(1)(ii).
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\7\ The Exchange represents it would not list options on a [sic]
Ether ETP unless it satisfied the criteria in Options 4, Section
3(a), the proposed listing criteria, and any other applicable
listing criteria.
\8\ Options 4, Section 3(h)(1) provides criteria and guidelines
when evaluating potential underlying securities for the listing of
options.
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Options on Ether ETPS will also be subject to the Exchange's
continued listing standards for options on ETFs set forth in Options 4,
Section 4(g) for ETFs deemed appropriate for options trading pursuant
to Options 4, Section 3(h). Specifically, options approved for trading
pursuant to Options 4, Section 3(h) will not be deemed to meet the
requirements for continued approval, and the Exchange shall not open
for trading any additional series of option contracts of the class
covering such ETFs if the ETFs are delisted from trading as provided in
subparagraph (b)(5) of Options 4, Section 4 \9\ or the ETFs are halted
or suspended from trading on their primary market.\10\ Additionally,
options on ETFs may be subject to the suspension of opening
transactions in any series of options of the class covering ETFs in any
of the following circumstances:
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\9\ Options 4, Section 4(b)(5) provides, if an underlying
security is approved for options listing and trading under the
provisions of Options 4, Section 3(c), the trading volume of the
Original Security (as therein defined) prior to but not after the
commencement of trading in the Restructure Security (as therein
defined), including `when-issued' trading, may be taken into account
in determining whether the trading volume requirement of (3) of this
paragraph (b) is satisfied. Options 4, Section 4(b)(3) provides,
``The trading volume (in all markets in which the underlying
security is traded) has been less than 1,800,000 shares in the
preceding twelve (12) months.''
\10\ See Options 4, Section 4(g).
(1) in the case of options covering Exchange-Traded Fund Shares
approved pursuant to Options 4, Section 3(h)(A)(i), in accordance
with the terms of subparagraphs (b)(1), (2), (3) and (4) of Options
4, Section 4; \11\
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\11\ Options 4, Section 4(b)(5)(1) through (4) provides, if: (1)
there are fewer than 6,300,000 shares of the underlying security
held by persons other than those who are required to report their
security holdings under Section 16(a) of the Act, (2) there are
fewer than 1,600 holders of the underlying security, (3) the trading
volume (in all markets in which the underlying security is traded)
has been less than 1,800,000 shares in the preceding twelve (12)
months, or (4) the underlying security ceases to be an `NMS stock'
as defined in Rule 600 of Regulation NMS under the Exchange Act.
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(2) in the case of options covering Fund Shares approved
pursuant to Options 4, Section 3(h)(A)(ii),\12\ following the
initial twelve-month period beginning upon the commencement of
trading in the Exchange-Traded Fund Shares on a national securities
exchange and are defined as an ``NMS stock'' under Rule 600 of
Regulation NMS, there were fewer than 50 record and/or beneficial
holders of such Exchange-Traded Fund Shares for 30 or more
consecutive trading days;
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\12\ Options 4, Section 3(h)(ii) refers to Currency Trust
Shares.
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(3) the value of the index or portfolio of securities or non-
U.S. currency, portfolio of commodities including commodity futures
contracts, options on commodity futures contracts, swaps, forward
contracts, options on physical commodities and/or Financial
Instruments and Money Market Instruments, on which the Exchange-
Traded Fund Shares are based is no longer calculated or available;
or
(4) such other event occurs or condition exists that in the
opinion of the Exchange makes further dealing in such options on the
Exchange inadvisable.
Options on a [sic] Ether ETP would be physically settled contracts
with American-style exercise.\13\ Consistent with current Options 4,
Section 5, which governs the opening of options series on a specific
underlying security (including ETFs), the Exchange will open at least
one expiration month for options on each Ether ETP \14\ and may also
list series of options on a [sic] Ether ETP for trading on a weekly
\15\ or quarterly \16\ basis. The Exchange may also list long-term
equity option series (``LEAPS'') that expire from twelve to thirty-nine
months from the time they are listed.\17\
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\13\ See Options 4, Section 2, Rights and Obligations of Holders
and Writers, which provides that the rights and obligations of
holders and writers shall be as set forth in the Rules of the
Clearing Corporation. See also The Options Clearing Corporation
(``OCC'') Rules, Chapter VIII, which governs exercise and
assignment, and Chapter IX, which governs the discharge of delivery
and payment obligations arising out of the exercise of physically
settled stock option contracts. OCC Rules can be located at: <a href="https://www.theocc.com/getmedia/9d3854cd-b782-450f-bcf7-33169b0576ce/occ_rules.pdf">https://www.theocc.com/getmedia/9d3854cd-b782-450f-bcf7-33169b0576ce/occ_rules.pdf</a>.
\14\ See Options 4, Section 5(b). At the commencement of trading
on the Exchange of a particular class of options, the Exchange will
open a minimum of one (1) series of options in that class. The
exercise price of that series will be fixed at a price per share,
relative to the underlying stock price in the primary market at
about the time that class of options is first opened for trading on
the Exchange. The monthly expirations are subject to certain listing
criteria for underlying securities described within Options 4,
Section 5. Monthly listings expire the third Friday of the month.
The term ``expiration date'' (unless separately defined elsewhere in
the OCC By-Laws), when used in respect of an option contract
(subject to certain exceptions), means the third Friday of the
expiration month of such option contract, or if such Friday is a day
on which the exchange on which such option is listed is not open for
business, the preceding day on which such exchange is open for
business. See OCC By-Laws Article I, Section 1. Pursuant to Options
4, Section 5(c), additional series of options of the same class may
be opened for trading on the Exchange when the Exchange deems it
necessary to maintain an orderly market, to meet customer demand or
when the market price of the underlying stock moves more than five
strike prices from the initial exercise price or prices. The opening
of a new series of options shall not affect the series of options of
the same class previously opened. New series of options on an
individual stock may be added until the beginning of the month in
which the options contract will expire. Due to unusual market
conditions, the Exchange, in its discretion, may add a new series of
options on an individual stock until the close of trading on the
business day prior to the business day of expiration, or, in the
case of an option contract expiring on a day that is not a business
day, on the second business day prior to expiration.
\15\ See Supplementary .03 to Options 4, Section 5.
\16\ See Supplementary .04 to Options 4, Section 5.
\17\ See Options 4, Section 8.
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Pursuant to Options 4, Section 5(d), which governs strike prices of
series of options on ETFs, the interval between strike prices of series
of options on
[[Page 65687]]
Ether ETPS approved for options trading pursuant to Section 3(h) of
Options 4 will be $1 or greater when the strike price is $200 or less
and $5 or greater when the strike price is greater than $200.\18\ With
respect to the Short Term Options Series or Weekly Program, during the
month prior to expiration of an option class that is selected for the
Short Term Option Series Program, the strike price intervals for the
related non-Short Term Option (``Related non-Short Term Option'') shall
be the same as the strike price intervals for the Short Term
Option.\19\ Specifically, the Exchange may open for trading Short Term
Option Series at strike price intervals of (i) $0.50 or greater where
the strike price is less than $100, and $1 or greater where the strike
price is between $100 and $150 for all option classes that participate
in the Short Term Options Series Program; (ii) $0.50 for option classes
that trade in one dollar increments and are in the Short Term Option
Series Program; or (iii) $2.50 or greater where the strike price is
above $150.\20\ Additionally, the Exchange may list series of options
pursuant to the $1 Strike Price Interval Program,\21\ the $0.50 Strike
Program,\22\ the $2.50 Strike Price Program,\23\ and the $5 Strike
Program.\24\ Pursuant to Options 3, Section 3, where the price of a
series of a Ether ETP options is less than $3.00, the minimum increment
will be $0.05, and where the price is $3.00 or higher, the minimum
increment will be $0.10.\25\ Any and all new series of Ether ETP
options that the Exchange lists will be consistent and comply with the
expirations, strike prices, and minimum increments set forth in Options
4, Section 5 and Options 3, Section 3, as applicable.
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\18\ See Options 5, Section 5(d). The interval between strike
prices of series of options on Exchange-Traded Fund Shares approved
for options trading pursuant to Section 3(h) of this Options 4 may
also be fixed at a price per share which is reasonably close to the
price per share at which the underlying security is traded in the
primary market at or about the same time such series of options is
first open for trading on the Exchange, or at such intervals as may
have been established on another options exchange prior to the
initiation of trading on the Exchange. See also Options 4, Section
5(h). The Exchange notes that for options listed pursuant to the
Short Term Option Series Program, the Quarterly Options Series
Program, and the Monthly Options Series Program, Supplementary
Material .03, .04 and .08 to Options 4, Section 5 specifically sets
forth intervals between strike prices on Short Term Option Series,
Quarterly Options Series, and Monthly Options Series, respectively.
\19\ See Supplementary Material .03(e) to Options 4, Section 5.
\20\ Id.
\21\ See Supplementary Material .01 to Options 4, Section 5.
\22\ See Supplementary Material .05 to Options 4, Section 5.
\23\ See Supplementary Material .02 to Options 4, Section 5.
\24\ See Supplementary Material .06 to Options 4, Section 5.
\25\ If options on a [sic] Ether ETP are eligible to participate
in the Penny Interval Program, the minimum increment will be $0.01
for series with a price below $3.00 and $0.05 for series with a
price at or above $3.00. See Supplementary Material .01 to Options
3, Section 3 (which describes the requirements for the Penny
Interval Program).
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Ether ETP options will trade in the same manner as options on other
ETFs on the Exchange. Exchange Rules that currently apply to the
listing and trading of all options on ETFs on the Exchange, including,
for example, Rules that govern listing criteria, expirations, exercise
prices, minimum increments, position and exercise limits, margin
requirements, customer accounts and trading halt procedures will apply
to the listing and trading of Ether ETPS on the Exchange in the same
manner as they apply to other options on all other ETFs that are listed
and traded on the Exchange, including the precious-metal backed
commodity ETFs already deemed appropriate for options trading on the
Exchange pursuant to pursuant to Options 4, Section 3(h)(iv).
Position and exercise limits for options on ETFs, including options
on Ether ETPS, are determined pursuant to Options 9, Sections 13 and
15, respectively. Position and exercise limits for ETFs options vary
according to the number of outstanding shares and the trading volumes
of the underlying ETF over the past six months, where the largest in
capitalization and the most frequently traded ETFs have an option
position and exercise limit of 250,000 contracts (with adjustments for
splits, re-capitalizations, etc.) on the same side of the market; and
smaller capitalization ETFs have position and exercise limits of
200,000, 75,000, 50,000 or 25,000 contracts (with adjustments for
splits, re-capitalizations, etc.) on the same side of the market.\26\
Further, Options 6C, Section 3, which governs margin requirements
applicable to the trading of all options on the Exchange including
options on ETFs, will also apply to the trading of the Ether ETP
options.
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\26\ As Ether ETPs do not currently trade, options on Ether ETPs
would be subject to the 25,000 option contract limit.
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The Exchange represents that the same surveillance procedures
applicable to all other options on other ETFs currently listed and
traded on the Exchange will apply to options on Ether ETPS, and that it
has the necessary systems capacity to support the new option series.
The Exchange believes that its existing surveillance and reporting
safeguards are designed to deter and detect possible manipulative
behavior which might potentially arise from listing and trading options
on ETFs, including precious metal-commodity backed ETF options, as
proposed. Also, the Exchange may obtain information from CME Group
Inc.'s designated contract markets that are members of the Intermarket
Surveillance Group related to any financial instrument that is based,
in whole or in part, upon an interest in or performance of ether, as
applicable.
The Exchange has also analyzed its capacity and represents that it
believes the Exchange and the Options Price Reporting Authority or
``OPRA'' have the necessary systems capacity to handle the additional
traffic associated with the listing of new series that may result from
the introduction of options on Ether ETPS up to the number of
expirations currently permissible under the Exchange Rules. Because the
proposal is limited to ETFs on a single commodity, the Exchange
believes any additional traffic that may be generated from the
introduction of Ether ETP options will be manageable.
The Exchange believes that offering options on Ether ETPS will
benefit investors by providing them with an additional, relatively
lower cost investing tool to gain exposure to the price of ether and
hedging vehicle to meet their investment needs in connection with
ether-related products and positions. The Exchange expects investors
will transact in options on Ether ETPS in the unregulated over-the-
counter (``OTC'') options market (if the Commission approves Ether ETPS
for exchange-trading),\27\ but may prefer to trade such options in a
listed environment to receive the benefits of trading listing options,
including (1) enhanced efficiency in initiating and closing out
position [sic]; (2) increased market transparency; and (3) heightened
contra-party creditworthiness due to the role of OCC as issuer and
guarantor of all listed options. The Exchange believes that listing
Ether ETP options may cause investors to bring this liquidity to the
Exchange, would increase market transparency and enhance the process of
price discovery conducted on the Exchange through increased order flow.
The ETFs that hold financial instruments, money market instruments, or
precious metal commodities on which the Exchange may already list and
trade options are trusts structured in substantially the same manner as
Ether ETPS and
[[Page 65688]]
essentially offer the same objectives and benefits to investors, just
with respect to different assets. The Exchange notes that it has not
identified any issues with the continued listing and trading of any ETF
options, including ETFS that hold commodities (i.e., precious metals)
that it currently lists and trades on the Exchange.
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\27\ The Exchange understands from customers that investors have
historically transacted in options on units in the OTC options
market if such options were not available for trading in a listed
environment.
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2. Statutory Basis
The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\28\ in general, and furthers the objectives of Section
6(b)(5) of the Act,\29\ in particular, in that it is designed to
prevent fraudulent and manipulative acts and practices, to promote just
and equitable principles of trade, to foster cooperation and
coordination with persons engaged in regulating, clearing, settling,
processing information with respect to, and facilitating transactions
in securities, to remove impediments to and perfect the mechanism of a
free and open market and a national market system, and, in general, to
protect investors and the public interest. Additionally, the Exchange
believes the proposed rule change is consistent with the Section
6(b)(5) \30\ requirement that the rules of an exchange not be designed
to permit unfair discrimination between customers, issuers, brokers, or
dealers.
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\28\ 15 U.S.C. 78f(b).
\29\ 15 U.S.C. 78f(b)(5).
\30\ 15 U.S.C. 78(f)(b)(5).
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In particular, the Exchange believes that the proposal to list and
trade options on Ether ETPS will remove impediments to and perfect the
mechanism of a free and open market and a national market system and,
in general, protect investors because offering options on Ether ETPS
will provide investors with a greater opportunity to realize the
benefits of utilizing options on a [sic] ether-based ETP, including
cost efficiencies and increased hedging strategies. The Exchange
believes that offering Ether ETP options will benefit investors by
providing them with a relatively lower-cost risk management tool, which
will allow them to manage their positions and associated risk in their
portfolios more easily in connection with exposure to the price of
ether and with ether-related products and positions. Additionally, the
Exchange's offering of Ether ETP options will provide investors with
the ability to transact in such options in a listed market environment
as opposed to in the unregulated OTC options market, which would
increase market transparency and enhance the process of price discovery
conducted on the Exchange through increased order flow to the benefit
of all investors. The Exchange also notes that it already lists options
on other commodity-based ETFs,\31\ which, as described above, are
trusts structured in substantially the same manner as Ether ETPS and
essentially offer the same objectives and benefits to investors, just
with respect to a different commodity (i.e., ether rather than precious
metals) and for which the Exchange has not identified any issues with
the continued listing and trading of commodity-backed ETF options it
currently lists for trading.
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\31\ See Options 4, Section 3(h)(iv).
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The Exchange also believes the proposed rule change will remove
impediments to and perfect the mechanism of a free and open market and
a national market system, because it is consistent with current
Exchange Rules, previously filed with the Commission. Options on Ether
ETPS must satisfy the initial listing standards and continued listing
standards currently in the Exchange Rules, applicable to options on all
ETFs, including ETFs that hold other commodities already deemed
appropriate for options trading on the Exchange. Ether ETP options will
trade in the same manner as any other ETF options--the same Exchange
Rules that currently govern the listing and trading of all ETF options,
including permissible expirations, strike prices and minimum
increments, and applicable position and exercise limits and margin
requirements, will govern the listing and trading of options on Ether
ETPS in the same manner.
The Exchange represents that it has the necessary systems capacity
to support the new ETF option series. The Exchange believes that its
existing surveillance and reporting safeguards are designed to deter
and detect possible manipulative behavior which might arise from
listing and trading ETF options, including Ether ETP options.
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 does not believe that the proposed rule change will
impose any burden on intramarket competition that is not necessary or
appropriate in furtherance of the purposes of the Act as Ether ETPS
would need to satisfy the initial listing standards set forth in the
Exchange Rules in the same manner as any other ETF before the Exchange
could list options on them. Additionally, Ether ETP options will be
equally available to all market participants who wish to trade such
options. The Exchange Rules currently applicable to the listing and
trading of options on ETFs on the Exchange will apply in the same
manner to the listing and trading of all options on Ether ETPS. Also,
and as stated above, the Exchange already lists options on other
commodity-based ETFs.\32\
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\32\ See Options 4, Section 3(h)(iv).
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The Exchange does not believe that the proposal to list and trade
options on Ether ETPS will impose any burden on intermarket competition
that is not necessary or appropriate in furtherance of the purposes of
the Act. To the extent that the advent of Ether ETP options trading on
the Exchange may make the Exchange a more attractive marketplace to
market participants at other exchanges, such market participants are
free to elect to become market participants on the Exchange.
Additionally, other options exchanges are free to amend their listing
rules, as applicable, to permit them to list and trade options on Ether
ETPS. Additionally, the Exchange notes that listing and trading Ether
ETP options on the Exchange will subject such options to transparent
exchange-based rules as well as price discovery and liquidity, as
opposed to alternatively trading such options in the OTC market. The
Exchange believes that the proposed rule change may relieve any burden
on, or otherwise promote, competition as it is designed to increase
competition for order flow on the Exchange in a manner that is
beneficial to investors by providing them with a lower-cost option to
hedge their investment portfolios. The Exchange notes that it operates
in a highly competitive market in which market participants can readily
direct order flow to competing venues that offer similar products.
Ultimately, the Exchange believes that offering Ether ETP options for
trading on the Exchange will promote competition by providing investors
with an additional, relatively low-cost means to hedge their portfolios
and meet their investment needs in connection with ether prices and
ether-related products and positions on a listed options exchange.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were either solicited or received.
[[Page 65689]]
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
<bullet> Use the Commission's internet comment form (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>); or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#790b0c151c541a1614141c170d0a390a1c1a571e160f"><span class="__cf_email__" data-cfemail="8efcfbe2eba3ede1e3e3ebe0fafdcefdebeda0e9e1f8">[email protected]</span></a>. Please include
file number SR-ISE-2024-34 on the subject line.
Paper Comments
<bullet> Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
All submissions should refer to file number SR-ISE-2024-34. 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 (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>). Copies of the submission, all subsequent amendments, all
written statements with respect to the proposed rule change that are
filed with the Commission, and all written communications relating to
the proposed rule change between the Commission and any person, other
than those that may be withheld from the public in accordance with the
provisions of 5 U.S.C. 552, will be available for website viewing and
printing in the Commission's Public Reference Room, 100 F Street NE,
Washington, DC 20549, on official business days between the hours of 10
a.m. and 3 p.m. Copies of the filing also will be available for
inspection and copying at the principal office of the Exchange. Do not
include personal identifiable information in submissions; you should
submit only information that you wish to make available publicly. We
may redact in part or withhold entirely from publication submitted
material that is obscene or subject to copyright protection. All
submissions should refer to file number SR-ISE-2024-34 and should be
submitted on or before September 3, 2024.
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\33\ 17 CFR 200.30-3(a)(12).
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\33\
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024-17843 Filed 8-9-24; 8:45 am]
BILLING CODE 8011-01-P
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</html>Indexed from Federal Register on August 12, 2024.
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