Securities and Exchange Commission
- [Release No. 34-103571; File Nos. SR-NASDAQ-2025-008; SR-NASDAQ-2025-038; SR-CboeBZX-2025-010; SR-CboeBZX-2025-023; SR-CboeBZX-2025-031; SR-CboeBZX-2025-033; SR-CboeBZX-2025-035; SR-CboeBZX-2025-050; SR-NYSEARCA-2025-38]
I. Introduction
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Exchange Act”) [1] and Rule 19b-4 thereunder (“Rule 19b-4”),[2] The Nasdaq Stock Market LLC (“Nasdaq”), Cboe BZX Exchange, Inc. (“BZX”), and NYSE Arca, Inc. (“NYSE Arca,” and together with Nasdaq and BZX, the “Exchanges”), each of which lists and trades bitcoin- and ether-based Commodity Based Trust Shares,[3] filed with the Securities and Exchange Commission (“Commission”) the respective proposed rule changes to permit the following trusts (each a “Trust,” and collectively, “Trusts”) to engage in creations and redemptions of their shares with authorized participants on an in-kind basis: (i) iShares Bitcoin Trust [4] and iShares Ethereum Trust,[5] listed under Nasdaq Rule 5711(d) (Commodity-Based Trust Shares); (ii) ARK 21Shares Bitcoin ETF and 21Shares Core Ethereum ETF,[6] Fidelity Wise Origin Bitcoin Fund and Fidelity Ethereum Fund,[7] VanEck Bitcoin ETF and VanEck Ethereum ETF,[8] WisdomTree Bitcoin Fund,[9] Invesco Galaxy Bitcoin ETF and Invesco Galaxy Ethereum ETF,[10] and Franklin Bitcoin ETF, Franklin Ethereum ETF, and Franklin Crypto Index ETF,[11] each listed under BZX Rule 14.11(e)(4) (Commodity-Based Trust Shares); and (iii) Bitwise Bitcoin ETF Trust and Bitwise Ethereum ETF,[12] listed under NYSE Arca Rule 8.201-E (Commodity-Based Trust Shares). Each of the ( printed page 36249) foregoing proposed rule changes, as modified by their respective amendments, is referred to herein as a “Proposal” and collectively as the “Proposals.” [13] The Proposals were published for comment in the Federal Register .[14] This order approves the Proposals on an accelerated basis.[15]
II. Discussion and Commission Findings
After careful review, the Commission finds that the Proposals are consistent with the Exchange Act and rules and regulations thereunder applicable to a national securities exchange.[16] In particular, the Commission finds that the Proposals are consistent with Section 6(b)(5) of the Exchange Act,[17] which requires, among other things, that the Exchanges' rules be 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.
Currently, the Trusts only create or redeem their shares with authorized participants in cash.[18] The Proposals would allow the Trusts, in addition to their ability to transact with authorized participants in cash, to engage in creations or redemptions of their shares in an in-kind transaction of spot bitcoin or spot ether, as applicable.[19] All Commodity-Based Trust Shares approved by the Commission before the approval of bitcoin and ether exchange-traded products could create and redeem shares on an in-kind basis.[20] Permitting in-kind creations and redemptions offer the Trusts an additional method of transacting with authorized participants and may enhance tax efficiencies and minimize transaction costs. Providing market participants with flexibility and creating potential efficiencies in the market is consistent with the requirements of Section 6(b)(5) of the Exchange Act [21] and, in particular, the requirement that the Exchanges' rules be designed to remove impediments to and perfect the mechanism of a free and open market and a national market system. Moreover, the Exchanges represent that all other representations relating to the Trusts will remain unchanged and continue to constitute continuing listing standards [22] and that the Trusts will continue to comply with all other provisions of the applicable Exchange listing standards relating to Commodity-Based Trust Shares.[23] As such, based on the record before the Commission,[24] the Commission finds that the Proposals are consistent with Section 6(b)(5) of the Exchange Act.[25]
III. Accelerated Approval of the Proposals
The Commission finds good cause to approve the Proposals prior to the 30th day after the date of publication of notice of the Exchanges' amended filings [26] in the Federal Register . The amended filings make technical clarifications of the proposed in-kind creation and redemption process and conform various representations in the amended filings to the applicable Exchange's listing standards and to representations that the Exchanges have made for other Commodity-Based Trust Shares that the Commission has approved.[27] These changes do not raise any novel regulatory issues. Further, the changes assist the Commission in evaluating the Proposals and in determining that they are consistent with the Exchange Act and the rules and regulations thereunder applicable to a national securities exchange, as discussed above. Accordingly, the Commission finds good cause, pursuant to Section 19(b)(2) of the Exchange Act,[28] to approve the Proposals on an accelerated basis.
IV. Conclusion
This approval order is based on all of the Exchanges' representations and descriptions in their respective amended filings, which the Commission has evaluated as discussed above.[29] For the reasons set forth above, the Commission finds, pursuant to Section 19(b)(2) of the Exchange Act,[30] that the Proposals are consistent with the requirements of the Exchange Act and the rules and regulations thereunder applicable to a national securities ( printed page 36250) exchange, and in particular, with Section 6(b)(5) of the Exchange Act.[31]
It is therefore ordered, pursuant to Section 19(b)(2) of the Exchange Act,[32] that the Proposals (SR-NASDAQ-2025-008; SR-NASDAQ-2025-038; SR-CboeBZX-2025-010; SR-CboeBZX-2025-023; SR-CboeBZX-2025-031; SR-CboeBZX-2025-033; SR-CboeBZX-2025-035; SR-CboeBZX-2025-050; SR-NYSEARCA-2025-38) be, and hereby are, approved on an accelerated basis.
By the Commission.
Sherry R. Haywood,
Assistant Secretary.