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Federal Register / Vol. 86, No. 210 / Wednesday, November 3, 2021 / Notices Month Jan 2020
Feb 2020
Mar 2020
Apr 2020
May 2020
Jun 2020
Jul 2020
Aug 2020
Sep 2020
Oct 2020
Nov 2020
Dec 2020

CME ADV
M $408
401
202
176
305
223
252
455
397
329
665
935

Given that the average daily trading volume of the CME Market in 2020 was 174% higher at $392 million than the Sponsors aggressive estimate of a new bitcoin ETPs potential trading volume of $143 million, the Sponsor found that it is unlikely that trading in a new bitcoin ETP will cause such ETP to become the predominant influence on prices in the CME Market.

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Conclusion of Winklevoss Standard Prong 2: Predominant Influence The second prong of the Winklevoss Standard requires demonstration that it is unlikely that trading in the Trust would become the predominant influence on prices in the CME Market.
As detailed herein, the Sponsors analysis shows that trading in the Trust is unlikely to become the predominant influence on prices in the CME Market, even when assuming aggressive estimates of first-year flows of $4.7
billion and average daily trading volume of $143 million.

In conclusion, as the foregoing analysis and data demonstrates, the proposal has met its burden presented by Section 6b5 of the Act 77 and, in particular, the requirement that the rules of a national securities exchange be designed to prevent fraudulent and manipulative acts and practices, by demonstrating that the CME Market i is a regulated market; ii participates in a surveillance sharing agreement with the Exchange; and iii satisfies the Commissions significant market definition under the Winklevoss Standard.
Availability of Information Regarding the Shares and Bitcoin The NAV 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 CTA. The ITV will be calculated every 15 seconds throughout the core 77 15

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trading session each trading day, and available through online information services.
The Sponsor will cause information about the Shares to be posted to the Trusts website https www.bitwise investments.com/: i The NAV and NAV per Share for each Exchange trading day, posted at end of day; ii the daily holdings of the Trust, before 9:30
a.m. E.T. on each Exchange trading day;
iii the Trusts effective prospectus, in a form available for download; and iv the Shares ticker and CUSIP
information, along with additional quantitative information updated on a daily basis for the Trust. For example, the Trusts website will include i the prior business days trading volume, the prior business days reported NAV and closing price, and a calculation of the premium and discount of the closing price or mid-point of the bid/ask spread at the time of NAV calculation Bid/
Ask Price against the NAV; and ii data in chart format displaying the frequency distribution of discounts and premiums of the daily closing price or Bid/Ask Price against the NAV, within appropriate ranges, for at least each of the four previous calendar quarters. The Trusts website will be publicly available prior to the public offering of Shares and accessible at no charge.
Investors may obtain on a 24-hour basis bitcoin pricing information based on the CME US Reference Rate, CME UK
Reference Rate and CME Bitcoin Real Time Price, bitcoin spot market prices and bitcoin futures price from various financial information service providers.
Current bitcoin spot market prices are also generally available with bid/ask spreads from bitcoin trading platforms, including the Constituent Platforms of the CME US Reference Rate.
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.78 Trading in Shares of the Trust will be halted if the circuit breaker parameters in NYSE Arca Rule 7.12E
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.
The Exchange may halt trading during the day in which an interruption to the dissemination of the ITV occurs.79 If the interruption to the dissemination of the 78 See
NYSE Arca Rule 7.12E.
limit up/limit down condition in the futures market would not be considered an interruption requiring the Trust to be halted.
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ITV 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
with respect to the Shares is not disseminated to all market participants at the same time, it will halt trading in the Shares until such time as the NAV
is available to all market participants.
The Exchange may also halt trading if the value of the underlying commodity is no longer calculated or available on at least a 15-second delayed basis from a source unaffiliated with the Sponsor, Trust, Bitcoin Custodian or the Exchange or if the Exchange stops providing a hyperlink on its website to any such unaffiliated commodity value.
Trading Rules The Exchange deems the Shares to be equity securities, thus rendering trading in the Shares subject to the Exchanges existing rules governing the trading of equity securities. Shares will trade on the NYSE Arca Marketplace from 4 a.m.
to 8 p.m. E.T. in accordance with NYSE
Arca Rule 7.34E 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 7.6E, 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 conform to the initial and continued listing criteria under NYSE Arca Rule 8.201E. The trading of the Shares will be subject to NYSE Arca Rule 8.201Eg, which sets forth certain restrictions on Equity Trading Permit ETP Holders acting as registered Market Makers in Commodity-Based Trust Shares to facilitate surveillance.80
80 Under NYSE Arca Rule 8.201Eg, an ETP
Holder acting as a registered Market Maker in the Shares is required to provide the Exchange with information relating to its trading in the underlying commodity, related futures or options on futures, or any other related derivatives. Commentary .04 of NYSE Arca Rule 11.3E 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
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