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Federal Register / Vol. 86, No. 51 / Thursday, March 18, 2021 / Notices
or growth thresholds. These competing pricing schedules, moreover, are presently comparable to those that the Exchange provides, including the pricing of comparable tiers.18
Moreover, the Exchange believes the proposed new pricing tiers continue to be a reasonable means to encourage ETP
Holders to increase their liquidity on the Exchange. Increased liquidity benefits all investors by deepening the Exchanges liquidity pool, offering additional flexibility for all investors to enjoy cost savings, supporting the quality of price discovery, promoting market transparency and improving investor protection.

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Tier 1
The Exchange believes that the proposed new additional threshold for qualifying for Tier 1 is reasonable because it is designed to encourage increased trading activity on the Exchange. The Exchange believes it is reasonable to require ETP Holders to meet the applicable volume threshold to qualify for the Tier 1 credits. Further, the proposed change is reasonable as it would allow ETP Holders an additional method to qualify for the credits payable under the pricing tier if ETP Holders are unable to meet the existing requirement.
The Exchange believes that the proposal represents a reasonable effort to promote price improvement and enhanced order execution opportunities for ETP
Holders. All ETP Holders would benefit from the greater amounts of liquidity on the Exchange, which would represent a wider range of execution opportunities.
The Exchange further believes that removing an extraneous phrase from Tier 1 and adopting ADV as an abbreviation for average daily volume is reasonable as it would add clarity to the Fee Schedule.
Step Up Tier The Exchange believes the proposed change to lower the volume requirement under the Step Up Tier is reasonable because it would allow ETP Holders to more easily meet the requirement of the pricing tier to receive per share credits payable under the pricing tier, thereby encouraging the submission of additional liquidity to a national securities exchange. Submission of additional liquidity to the Exchange would promote price discovery and transparency and enhance order execution opportunities for ETP Holders 18 See e.g., Cboe BZX U.S. Equities Exchange BZX Fee Schedule, Footnote 1, Add/Remove Volume Tiers, which provide enhanced rebates between $0.0025 and $0.0031 per share for displayed orders where BZX members meet certain volume thresholds.

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from the substantial amounts of liquidity present on the Exchange. All ETP Holders would benefit from the greater amounts of liquidity that will be present on the Exchange, which would provide greater execution opportunities.
The Exchange believes the proposed lower volume requirement is also reasonable as it would provide an additional incentive for ETP Holders to qualify for this established tier and direct their order flow to the Exchange and provide meaningful added levels of displayed liquidity, thereby contributing to the depth and market quality on the Exchange.
On the backdrop of the competitive environment in which the Exchange currently operates, the proposed rule change is a reasonable attempt to increase liquidity on the Exchange and improve the Exchanges market share relative to its competitors.
Cross-Asset Tier 1
The Exchange believes that the proposed rule change to eliminate the Cross-Asset Tier 1 is reasonable because the pricing tier has been underutilized and has not incentivized ETP Holders to bring liquidity and increase trading on the Exchange. Since January 2020, no ETP Holder has availed itself to the pricing tier that the Exchange is proposing to eliminate. The Exchange does not anticipate any ETP Holder in the near future to qualify for the pricing tier that is the subject of this proposed rule change. The Exchange believes it is reasonable to eliminate requirements and credits, and even an entire pricing tier when such incentives become underutilized. The Exchange believes eliminating underutilized incentive programs would also simplify the Fee Schedule. The Exchange further believes that removing reference to the pricing tier that the Exchange is proposing to eliminate would also add clarity to the Fee Schedule.
The Proposed Fee Change Is an Equitable Allocation of Fees and Credits The Exchange believes its proposal equitably allocates its fees among its market participants.
Tape C Tiers 14
The Exchange believes the proposal to eliminate the current Tape C Tier 1 and Tier 2 pricing tiers is equitable and not unfairly discriminatory because it would equally impact to all ETP
Holders i.e., the tiers wont be available for any ETP Holder.
The Exchange believes that the proposed adoption of Tape C Tiers 14
represents an equitable allocation of fees and is not unfairly discriminatory
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because all ETP Holders will be eligible for the proposed new tiers and the corresponding rebates will apply uniformly to all ETP Holders that reach the proposed tier criteria. That is, the proposed tiers are designed as an incentive to any and all ETP Holders interested in meeting the tier criteria to submit additional order flow to the Exchange and each will receive the proposed rebate if a tier criteria is met.
While the Exchange has no way of knowing whether this proposed rule change would definitively result in any particular ETP Holder qualifying for the proposed tiers, the Exchange anticipates a number of ETP Holders meeting, or being reasonably able to meet, the proposed criteria. However, without having a view of ETP Holders activity on other markets and off-exchange venues, the Exchange has no way of knowing whether this proposed rule change would result in any ETP Holder qualifying for the proposed new pricing tiers. The Exchange also notes that the proposed change will not adversely impact any ETP Holders pricing or their ability to qualify for other rebate tiers.
Rather, should an ETP Holder not meet the proposed criteria, the ETP Holder will merely not receive the corresponding rebate.
Tier 1
The Exchange believes the proposed rule change to introduce alternative criteria for ETP Holders to qualify for Tier 1 equitably allocates its fees among its market participants. The Exchange believes the Tier 1 pricing tier is equitable because it is open to all similarly situated ETP Holders on an equal basis and provides a per share credit that is reasonably related to the value of an exchanges market quality associated with higher volumes. The Exchange believes it is equitable to require ETP Holders to meet the applicable volume thresholds to qualify for the Tier 1 credits. Further, the proposed change is also equitable as it would allow ETP Holders an additional method to qualify for the credits payable under the pricing tier if ETP Holders are unable to meet the current requirement.
The Exchange believes the proposed change would continue to encourage ETP Holders to both submit additional liquidity to the Exchange and execute orders on the Exchange, thereby contributing to robust levels of liquidity, to the benefit of all market participants.
The Exchange believes that modifying Tier 1 would encourage the submission and removal of additional liquidity from the Exchange, thus enhancing order execution opportunities for ETP Holders from the substantial amounts of
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