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Federal Register / Vol. 86, No. 210 / Wednesday, November 3, 2021 / Notices
The Exchange represents that, for initial and continued listing, the Trust will be in compliance with Rule 10A3 under the Act,81 as provided by NYSE Arca Rule 5.3E. A minimum of 100,000
Shares of the Trust will be outstanding at the commencement of trading on the Exchange.

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Surveillance The Exchange represents that trading in the Shares of the Trust will be subject to the existing trading surveillances administered by the Exchange, as well as cross-market surveillances administered by FINRA on behalf of the Exchange, which are designed to detect violations of Exchange rules and applicable federal securities laws.82 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 applicable to trading on the Exchange.
The Exchange further represents that it may obtain information regarding trading in the Shares and the CME
Market from the CME and other markets and other entities that are members of the ISG or with which the Exchange has in place a comprehensive surveillance sharing agreement.83 The Exchange or FINRA, on behalf of the Exchange, or both, will communicate as needed regarding trading in the Shares and the CME Market with the CME and other markets and entities 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, the CME Market and the underlying commodity, as applicable, from such markets and other entities.
Also, pursuant to NYSE Arca Rule 8.201Eg, the Exchange is able to obtain information regarding trading in the Shares, bitcoin futures and the underlying bitcoin through ETP Holders 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, the Exchange could obtain information regarding the activities of such subsidiary or affiliate through surveillance sharing agreements with regulatory organizations of which such subsidiary or affiliate is a member.
81 17 CFR 240.10A3.
82 FINRA conducts cross-market surveillances on behalf of the Exchange pursuant to a regulatory services agreement. The Exchange is responsible for FINRAs performance under this regulatory services agreement.
83 For a list of the current members of ISG, see https isgportal.org/. The Exchange notes that not all components of the Trust may trade on markets that are members of ISG or with which the Exchange has in place a comprehensive surveillance sharing agreement.

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acting as registered Market Makers, in connection with such ETP Holders proprietary or customer trades through ETP Holders which they effect on any relevant market.
In addition, the Exchange has a general policy prohibiting the improper distribution of material, non-public information by its employees.
All statements and representations made in this filing regarding i the description of the index, portfolio or referenced asset, ii limitations on index or portfolio holdings or reference assets, or iii the applicability of Exchange listing rules specified in this rule filing will constitute continued listing requirements for listing the Shares on the Exchange.
The Sponsor has represented to the Exchange that it will advise the Exchange of any failure by the Trust to comply with the continued listing requirements, and, pursuant to its obligations under Section 19g1 of the Act, the Exchange will monitor for compliance with the continued listing requirements. If the Trust is not in compliance with the applicable listing requirements, the Exchange will commence delisting procedures under NYSE Arca Rule 9.2Ea.
2. Statutory Basis The basis under the Act for this proposed rule change is the requirement under Section 6b5 84 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 and to protect investors and the public interest in that the Shares will be listed and traded on the Exchange pursuant to the initial and continued listing criteria in NYSE Arca Rule 8.201E. Further, the Exchange has demonstrated that the proposed rule change satisfies the Winklevoss Standard with respect to the CME
Market.
As discussed above, both existing academic literature and the Sponsors own studies show that the CME Market leads price discovery relative to the bitcoin spot market. As a result, and given that the Sponsor has demonstrated that it is unlikely that trading in the Shares will become the predominant influence upon prices in 84 15

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85 See notes 222 and 23, supra, and accompanying text.

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the CME Market, the CME Market represents a regulated market of significant size, and that there is a reasonable likelihood that a person attempting to manipulate the Shares would also have to trade on that market to successfully manipulate the Shares.85
The Exchange has in place surveillance procedures that are adequate to properly monitor trading in the Shares and the CME Market in all trading sessions and to deter and detect attempted manipulation of the Shares or other 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 and bitcoin futures with the CME and other markets and other entities 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 from such markets and other entities. In addition, the Exchange may obtain information regarding trading in the Shares from markets and other entities that are members of ISG or with which the Exchange has in place a comprehensive surveillance sharing agreement. The Exchange is also able to obtain information regarding trading in the Shares and bitcoin futures or the underlying bitcoin through ETP
Holders, in connection with such ETP
Holders proprietary or customer trades which they effect through ETP Holders on any relevant market.
Quotation and last-sale information regarding the Shares will be disseminated through the facilities of the CTA. The Trusts website will also include a form of the prospectus for the Trust that may be downloaded. The website will include the Shares ticker and CUSIP information, along with additional quantitative information updated on a daily basis for the Trust.
The Trusts website will include i daily trading volume, the prior business days reported NAV and closing price, and a calculation of the premium and discount of the closing price or midpoint of the 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.

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