5054 Federal Register / Vol. 89, No. 17 / Thursday, January 25, 2024 / Notices 

11The Exchange notes that Public Customer fees 

remain lower than Market Maker fees, with the 

exception of Market Maker maker fees contra to 

Non-Public Customers for electronic Non-Auction 

Transactions, as well as Market Maker maker fees 

contra to Public Customers assessed in SPY for 

electronic Non-Auction Transactions. Similar to 

Public Customers, Market Makers are assessed no 

fee for the above transactions. 

12See supra note 5. 

13 15 U.S.C. 78s(b)(3)(A)(ii). 

14 17 CFR 240.19b–4(f)(2). 

15 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

transactions contra to Public Customers. 

The proposed change would apply to all 

similarly situated market participants 

and, accordingly, the proposed change 

would not impose a disparate burden on 

competition among Participants on 

BOX. The proposed change is designed 

to compete with other options 

exchanges and to attract order flow. The 

Exchange notes that Public Customer 

fees remain lower than Professional 

Customer, Broker Dealer, and certain 

Market Maker fees because BOX has 

historically aimed to improve markets 

for investors and develop various 

features within the market structure for 

Public Customer benefit.11 The 

Exchange believes further the proposed 

changes to Professional Customer and 

Broker Dealer Penny Interval Class and 

SPY maker fees contra to Public 

Customers in the electronic NonAuction Transactions fee structure will 

not impose a burden on intermarket 

competition. The Exchange notes that 

the Non-Auction Transaction fee 

structure as a whole, including the 

proposed change, is designed to be 

competitive with other options 

exchanges and to attract order flow. The 

Exchange believes the electronic NonAuction Transactions fee structure, 

including the proposed change, will 

remain competitive with other options 

exchanges.12

Finally, the Exchange notes that it 

operates in a highly competitive market 

in which market participants can 

readily favor competing venues. In such 

an environment, the Exchange must 

continually review, and consider 

adjusting, its fees and rebates to remain 

competitive with other exchanges. 

Because competitors are free to modify 

their own fees and rebates in response, 

and because market participants may 

readily adjust their order routing 

practices, the Exchange believes that the 

degree to which fee or rebate changes in 

this market may impose any burden on 

competition is extremely limited. For 

the reasons described above, the 

Exchange believes that the proposed 

rule change will encourage intermarket 

competition. 

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. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

effective pursuant to Section 

19(b)(3)(A)(ii) of the Exchange Act 13

and Rule 19b–4(f)(2) thereunder,14

because it establishes or changes a due, 

or fee. 

At any time within 60 days of the 

filing of the proposed rule change, the 

Commission summarily may 

temporarily suspend the rule change if 

it appears to the Commission that the 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or would otherwise further 

the purposes of the Act. If the 

Commission takes such action, the 

Commission shall institute proceedings 

to determine whether the proposed rule 

should be approved or 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 

• Use the Commission’s internet 

comment form (https://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include file numberSR– 

BOX–2024–04 on the subject line. 

Paper Comments 

• 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–BOX–2024–04. 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 (https://www.sec.gov/ 

rules/sro.shtml). 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–BOX–2024–04 and should be 

submitted on or before February 15, 

2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.15

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2024–01392 Filed 1–24–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–99401; File No. SR–BOX– 

2024–05] 

Self-Regulatory Organizations; BOX 

Exchange LLC; Notice of Filing and 

Immediate Effectiveness of a Proposed 

Rule Change To Amend the Fee 

Schedule for Trading on the BOX 

Options Market LLC Facility To Modify 

Certain Electronic Non-Auction 

Transaction Fees 

January 19, 2024. 

Pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 

(‘‘Act’’),1 and Rule 19b–4 thereunder,2

notice is hereby given that on January 

12, 2024, BOX Exchange LLC 

(‘‘Exchange’’) filed with the Securities 

and Exchange Commission 

(‘‘Commission’’) the proposed rule 

change as described in Items I, II, and 

III below, which Items have been 

prepared by the Exchange. The 

Exchange filed the proposed rule change 

pursuant to Section 19(b)(3)(A)(ii) of the 


khammond on DSKJM1Z7X2PROD with NOTICES
Federal Register / Vol. 89, No. 17 / Thursday, January 25, 2024 / Notices 5055 

3 15 U.S.C. 78s(b)(3)(A)(ii). 

4 17 CFR 240.19b–4(f)(2). 

5See BOX Informational Circular 2022–11 

available at https://boxoptions.com/assets/IC-2022- 

11-Penny-Program-Class-Removals-1.pdf. 

Act,3 and Rule 19b–4(f)(2) thereunder,4

which renders the proposal effective 

upon filing with the Commission. The 

Commission is publishing this notice to 

solicit comments on the proposed rule 

change from interested persons. 

I. Self-Regulatory Organization’s 

Statement of the Terms of the Substance 

of the Proposed Rule Change 

The Exchange is filing with the 

Securities and Exchange Commission 

(‘‘Commission’’) a proposed rule change 

to amend the Fee Schedule on the BOX 

Options Market LLC (‘‘BOX’’) options 

facility. The text of the proposed rule 

change is available from the principal 

office of the Exchange, at the 

Commission’s Public Reference Room 

and also on the Exchange’s internet 

website at https://rules.boxexchange.

com/rulefilings. 

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 

Section IV.A, Non-Auction 

Transactions, of the BOX Fee Schedule. 

Specifically, the Exchange proposes to 

establish separate fees and rebates on 

electronic Non-Auction Transactions for 

options overlying the INVESCO QQQ 

TrustSM, Series 1 (‘‘QQQ’’), and iShares 

Russell 2000 Index Fund (‘‘IWM’’). 

Non-Auction Transactions 

Currently, in Section IV.A of the BOX 

Fee Schedule, fees and credits for 

electronic Non-Auction Transactions are 

assessed depending on three factors: (i) 

the account type of the Participant 

submitting the order; (ii) whether the 

Participant is a liquidity provider or 

liquidity taker; and (iii) the account type 

of the contra party. 

The Exchange now proposes to assess 

separate fees for QQQ and IWM 

electronic Non-Auction Transactions. 

Currently, when a Public Customer 

QQQ or IWM order is a liquidity taker 

contra to a Professional Customer, 

Broker Dealer, or a Market Maker, the 

Public Customer is provided a $0.20 

rebate. The Exchange now proposes to 

increase Public Customer taker fees on 

QQQ and IWM electronic Non-Auction 

Transactions. Accordingly, when a 

Public Customer QQQ or IWM order is 

a liquidity taker contra to a Professional 

Customer, Broker Dealer, or a Market 

Maker, the Public Customer will be 

assessed $0.10. Further, under this 

proposal, Public Customer QQQ or IWM 

orders that interact with a Public 

Customer QQQ or IWM order will 

continue to not be assessed a fee. 

Further, when a Professional 

Customer or Broker Dealer QQQ or IWM 

order interacts with a Public Customer 

QQQ or IWM order, the Exchange 

proposes to assess a $0.50 fee when 

making liquidity or $0.50 when taking 

liquidity. When a Professional Customer 

or Broker Dealer QQQ or IWM order 

interacts with a Professional Customer, 

Broker Dealer, or Market Maker QQQ or 

IWM order, the Exchange proposes to 

assess $0.15 for making liquidity or 

$0.50 for taking liquidity. The Exchange 

notes that these fees are the same as fees 

currently assessed to QQQ and IWM 

transactions as QQQ and IWM are 

Penny Interval Classes.5

When a Market Maker QQQ or IWM 

order interacts with a Public Customer 

QQQ or IWM order, the Exchange 

proposes to assess $0.00 when making 

liquidity or $0.50 when taking liquidity. 

The Exchange notes that assessing 

Market Maker QQQ and IWM orders 

that interact with Public Customers 

$0.00 for making liquidity is a fee 

decrease from the current fee, which is 

$0.50. Lastly, when a Market Maker 

QQQ or IWM order interacts with a 

Professional Customer, Broker Dealer, or 

Market Maker QQQ or IWM order, the 

Exchange proposes to assess no fee 

when making liquidity or $0.50 when 

taking liquidity, which is the same as 

the currently assessed fee for QQQ and 

IWM orders. 

The proposed fee structure for QQQ 

and IWM electronic Non-Auction 

Transactions will be as follows: 

Account type 

SPY, QQQ, and IWM 

Contra party Maker Taker 

Public Customer ....................................................................... Public Customer ....................................................................... $0.00 $0.00 

Professional Customer/Broker Dealer ..................................... 0.00 0.10 

Market Maker ........................................................................... 0.00 0.10 

Professional Customer or Broker Dealer .................................. Public Customer ....................................................................... 0.50 0.50 

Professional Customer/Broker Dealer ..................................... 0.15 0.50 

Market Maker ........................................................................... 0.15 0.50 

Market Maker ............................................................................ Public Customer ....................................................................... 0.00 0.50 

Professional Customer/Broker Dealer ..................................... 0.00 0.50 

Market Maker ........................................................................... 0.00 0.50 

For example, under the proposal, if a 

Public Customer submitted a QQQ order 

to the BOX Book (making liquidity), the 

Public Customer would not be charged 

a fee if the order interacted with a 

Market Maker’s QQQ order and the 

Market Maker (taking liquidity) would 

be charged $0.50. 

Tiered Volume Rebate for Non-Auction 

Transactions 

The Exchange also proposes to amend 

Section IV.A.1 of the Fee Schedule, 

Tiered Volume Rebate for Non-Auction 

Transactions. Specifically, the Exchange 

proposes to adopt separate rebates for 

QQQ and IWM transactions for Public 

Customers in Non-Auction 

Transactions. For Tier 1, where 

percentage thresholds of Public 


khammond on DSKJM1Z7X2PROD with NOTICES
5056 Federal Register / Vol. 89, No. 17 / Thursday, January 25, 2024 / Notices 

6 15 U.S.C. 78f(b)(4) and (5). 

7See Cboe C2 Exchange, Inc. Fee Schedule and 

MIAX PEARL, LLC Fee Schedule and Nasdaq BX, 

Inc. Fee Schedule. 

8See e.g., Cboe C2 Exchange, Inc. Fee Schedule 

(‘‘Transaction Fees’’ applicable to QQQ and IWM 

for Public Customer Remove rates of $0.37); MIAX 

PEARL, LLC Fee Schedule (‘‘Transaction Rebates/ 

Fees’’ for Priority Customer QQQ and IWM Taker 

in Tier 1 of $0.48). 

Customer volume is 0.000%—0.249%, 

the Exchange proposes no rebates. For 

Tier 2, where percentage thresholds of 

Public Customer volume is 0.250%— 

0.499%, the Exchange proposes to offer 

a $0.05 rebate when making liquidity or 

no rebate when taking liquidity. For 

Tier 3, where percentage thresholds of 

Public Customer volume is 0.500%— 

0.749%, the Exchange proposes a $0.10 

rebate when making liquidity or no 

rebate when taking liquidity. For Tier 4, 

where percentage thresholds of Public 

Customer volume is 0.750%—0.999%, 

the Exchange proposes a $0.20 rebate 

when making liquidity or no rebate for 

taking liquidity. In Tier 5, where 

percentage thresholds of Public 

Customer volume is 1.000% and above, 

the Exchange proposes a $0.27 rebate 

when making liquidity or $0.11 rebate 

when taking liquidity. The proposed 

rebate structure will be as follows: 

Tier Percentage thresholds of national customer volume in multiply-listed options classes 

(monthly) 

Per contract rebate 

SPY, QQQ, and IWM 

Maker Taker 

1 ............. 0.000%–0.249% .................................................................................................................................. $0.00 $0.00 

2 ............. 0.250%–0.499% .................................................................................................................................. (0.05) 0.00 

3 ............. 0.500%–0.749% .................................................................................................................................. (0.10) 0.00 

4 ............. 0.750%–0.999% .................................................................................................................................. (0.20) 0.00 

5 ............. 1.000% and Above .............................................................................................................................. (0.27) (0.11) 

2. Statutory Basis 

The Exchange believes that the 

proposal is consistent with the 

requirements of Section 6(b) of the Act, 

in general, and Section 6(b)(4) and 

6(b)(5) of the Act,6 in particular, in that 

it provides for the equitable allocation 

of reasonable dues, fees, and other 

charges among BOX Participants and 

other persons using its facilities and 

does not unfairly discriminate between 

customers, issuers, brokers or dealers. 

The Exchange’s proposal to adopt 

separate fees for QQQ and IWM 

electronic Non-Auction Transactions is 

reasonable, equitable, and not unfairly 

discriminatory because pricing by 

symbol is a common practice on many 

U.S. options exchanges as a means to 

incentivize order flow to be sent to an 

exchange for execution in the most 

actively traded options classes. The 

Exchange notes that the proposed fees 

are identical to the fees currently 

assessed for SPY transactions on BOX. 

The Exchange also notes that other 

exchanges assess separate fees and 

credits for QQQ and IWM transactions.7

Further, QQQ and IWM are two of the 

most actively traded options and 

therefore the Exchange believes that 

separate fees are appropriate to more 

effectively attract order flow to BOX. 

Non-Auction Transactions 

The Exchange believes the proposed 

electronic Non-Auction Transaction fees 

for Public Customer QQQ and IWM 

transactions are reasonable. Under the 

proposal, Public Customers will never 

pay a fee for their QQQ or IWM NonAuction Transactions when making 

liquidity against Public Customer or 

Non-Public Customer QQQ or IWM 

orders. The Exchange notes that Public 

Customers are not currently assessed a 

fee for their QQQ or IWM Non-Auction 

Transactions when making liquidity 

against Public Customer or Non-Public 

Customer QQQ or IWM orders. The 

securities markets generally, and BOX 

in particular, have historically aimed to 

improve markets for investors and 

develop various features within the 

market structure for Public Customer 

benefit. The Exchange believes that 

assessing no fee will attract Public 

Customer order flow, which provides 

increased opportunities to interact with 

Public Customer order flow to the 

benefit of all Participants. Accordingly, 

the Exchange believes that charging no 

fee for Public Customers when making 

liquidity for their QQQ and IWM 

transactions is appropriate and not 

unfairly discriminatory. 

Under the proposal, Public Customer 

taker fees for QQQ and IWM electronic 

Non-Auction Transactions when taking 

liquidity against Professional 

Customers, Broker Dealers, or Market 

Makers will be $0.10, which is a fee 

increase from what is currently 

assessed. The Exchange believes the 

proposed electronic Non-Auction 

transaction fees for Public Customer 

QQQ and IWM transactions are 

reasonable as the proposed fees are 

lower than similar transaction fees 

assessed at other exchanges.8 The 

Exchange further believes that the 

proposed QQQ and IWM taker fee for 

electronic Non-Auction Public 

Customer transactions will not 

disincentivize Public Customer order 

flow because BOX’s electronic NonAuction Transactions fee structure is 

designed to attract competitive quotes 

and orders, which results in liquid 

markets that Public Customers may find 

attractive. The Exchange believes that 

Public Customers may be willing to pay 

a fee of $0.10 to access such competitive 

markets. 

The Exchange believes further that 

charging a fee of $0.10 to Public 

Customers for QQQ and IWM electronic 

Non-Auction Transactions is equitable 

and not unfairly discriminatory. The 

Exchange notes that Professional 

Customer, Broker Dealer, and Market 

Maker taker fees for QQQ and IWM 

electronic Non-Auction Transactions 

when taking liquidity against any contra 

party are $0.50 while Public Customers 

will be assessed $0.10 when taking 

liquidity against Professional 

Customers, Broker Dealers, and Market 

Makers. The Exchange again notes that 

the securities markets generally, and 

BOX in particular, have historically 

aimed to improve markets for investors 

and develop various features within the 

market structure for Public Customer 

benefit. The Exchange believes that 

assessing lower fees for Public 

Customers compared to other account 

types will attract Public Customer order 

flow, which provides increased 

opportunities to interact with Public 

Customer order flow to the benefit of all 

Participants. Accordingly, the Exchange 

believes that charging a lower fee for 

Public Customers for their QQQ and 

IWM transactions compared to other 

account types on BOX is appropriate 

and not unfairly discriminatory. 

The Exchange believes that charging 

Professional Customers and Broker 

Dealers higher fees than Public 

Customers for QQQ and IWM electronic 

Non-Auction Transactions is equitable 

and not unfairly discriminatory. 


khammond on DSKJM1Z7X2PROD with NOTICES
Federal Register / Vol. 89, No. 17 / Thursday, January 25, 2024 / Notices 5057 

9See BOX Fee Schedule, Section IV.A. 10See supra note 7. 

11 15 U.S.C. 78s(b)(3)(A)(ii). 

12 17 CFR 240.19b–4(f)(2). 

Professional Customers, while Public 

Customers by virtue of not being Broker 

Dealers, generally engage in trading 

activity more similar to Broker Dealer 

proprietary trading accounts (submitting 

more than 390 standard orders per day 

on average). The Exchange believes that 

the higher level of trading activity from 

these Participants will draw a greater 

amount of BOX system resources than 

that of non-professional, Public 

Customers. Because this higher level of 

trading activity will result in greater 

ongoing operational costs, the Exchange 

aims to recover its costs by assessing 

Professional Customers and Broker 

Dealers higher fees for transactions. The 

Exchange again notes that Professional 

Customers and Broker Dealers are 

currently assessed the same fees for 

their QQQ and IWM transactions as 

QQQ and IWM are Penny Interval 

Classes.9

The Exchange believes it is 

reasonable, equitable and not unfairly 

discriminatory to assess no maker fee 

for BOX Market Makers trading against 

a Public Customer, Professional 

Customer, Broker Dealer, or Market 

Maker for QQQ and IWM electronic 

Non-Auction Transactions. The 

Exchange notes that under this proposal 

Market Makers making liquidity against 

a Public Customer for QQQ and IWM 

electronic Non-Auction Transactions 

will not be assessed a fee, which is a fee 

decrease from what is currently 

assessed. As a result of this change, 

Market Makers may tighten their 

spreads in QQQ and IWM and therefore 

will increase market quality in QQQ and 

IWM options. Specifically, Market 

Makers can provide higher volumes of 

liquidity and lowering certain fees will 

help attract a higher level of Market 

Maker order flow to the BOX Book and 

create liquidity. As such, the Exchange 

believes it is appropriate that Market 

Makers be charged lower transaction 

fees than Professional Customers and 

Broker Dealers for QQQ and IWM 

electronic Non-Auction Transactions. 

Tiered Volume Rebate for Non-Auction 

Transactions 

The Exchange believes that the 

proposed Public Customer QQQ and 

IWM rebates in the Tiered Volume 

Rebate for Non-Auction Transactions 

structure are reasonable, equitable, and 

not unfairly discriminatory. The 

proposed volume thresholds and 

applicable rebates for QQQ and IWM 

transactions are meant to incentivize 

Public Customers to post orders on BOX 

to obtain the benefit of the rebate, which 

will in turn benefit all market 

participants by increasing liquidity on 

BOX. The Exchange notes that the 

proposed QQQ and IWM rebates are 

identical to the rebates that are currently 

assessed to SPY transactions today. 

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 not 

necessary or appropriate in furtherance 

of the purposes of the Act. The 

Exchange believes the proposed change 

will not impose a burden on intramarket 

competition as BOX believes that the 

changes will result in the Participants 

being charged appropriately for their 

QQQ and IWM transactions. 

Specifically, the change to eliminate 

Market Maker maker fees when contra 

to Public Customers is designed to 

incentivize order flow to BOX by 

incentivizing Market Makers to provide 

tighter spreads thus improving market 

quality to the benefit of all BOX 

Participants. Additionally, the Exchange 

believes that eliminating Public 

Customer credits when taking liquidity 

contra to a Professional Customer, 

Broker Dealer, or Market Maker and 

instead assessing a fee will not 

disincentivize the sending of such 

orders because BOX’s electronic NonAuction Transactions fee structure is 

designed to attract competitive quotes 

and orders, which results in liquid 

markets that Public Customers may find 

attractive. The Exchange notes further 

that submitting an order is entirely 

voluntary and Participants can 

determine which type of order they 

wish to submit, if any, to BOX. Further, 

the Exchange believes the proposed 

changes will not impose a burden on 

intermarket competition as another 

exchange currently assesses separate 

fees for QQQ and IWM transactions.10

The Exchange believes the addition of 

QQQ and IWM to the rebate structure 

for Public Customer electronic NonAuction Transactions will not impose a 

burden on competition among various 

Exchange Participants. The Exchange 

believes that the proposed changes will 

result in Public Customers being rebated 

appropriately for their QQQ and IWM 

transactions. Further, the Exchange 

believes that this proposal will enhance 

competition between exchanges because 

it is designed to allow BOX to better 

compete with other exchanges for this 

order flow. 

Finally, the Exchange notes that it 

operates in a highly competitive market 

in which market participants can 

readily favor competing venues. In such 

an environment, the Exchange must 

continually review, and consider 

adjusting, its fees and credits to remain 

competitive with other exchanges. For 

the reasons described above, the 

Exchange believes that the proposed 

rule change reflects this competitive 

environment. 

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. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change has become 

effective pursuant to Section 

19(b)(3)(A)(ii) of the Exchange Act 11

and Rule 19b–4(f)(2) thereunder,12

because it establishes or changes a due, 

or fee. 

At any time within 60 days of the 

filing of the proposed rule change, the 

Commission summarily may 

temporarily suspend the rule change if 

it appears to the Commission that the 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or would otherwise further 

the purposes of the Act. If the 

Commission takes such action, the 

Commission shall institute proceedings 

to determine whether the proposed rule 

should be approved or 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 

• Use the Commission’s internet 

comment form (https://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include file number 

SR–BOX–2024–05 on the subject line. 

Paper Comments 

• 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–BOX–2024–05. This file 

number should be included on the 

subject line if email is used. To help the 

Commission process and review your 


khammond on DSKJM1Z7X2PROD with NOTICES
5058 Federal Register / Vol. 89, No. 17 / Thursday, January 25, 2024 / Notices 

13 17 CFR 200.30–3(a)(12). 

1 15 U.S.C. 78s(b)(1). 

2 17 CFR 240.19b–4. 

3The Exchange notes that its affiliate exchange, 

MIAX Options, has submitted a substantively 

identical proposal. 

4See Exchange Rule 402(i), which permits 

options trading on ETFS that: (1) represent interests 

in registered investment companies (or series 

thereof) organized as open-end management 

investment companies, unit investment trusts or 

similar entities that hold portfolios of securities 

and/or financial instruments (‘‘Funds’’), including, 

but not limited to, stock index futures contracts, 

options on futures, options on securities and 

indices, equity caps, collars and floors, swap 

agreements, forward contracts, repurchase 

agreements and reverse repurchase agreements (the 

‘‘Financial Instruments’’), and money market 

instruments, including, but not limited to, U.S. 

government securities and repurchase agreements 

(the ‘‘Money Market Instruments’’) comprising or 

otherwise based on or representing investments in 

broad-based indexes or portfolios of securities and/ 

or Financial Instruments and Money Market 

Instruments (or that hold securities in one or more 

other registered investment companies that 

themselves hold such portfolios of securities and/ 

or Financial Instruments and Money Market 

Instruments); (2) represent interests in a trust or 

similar entity that holds a specified non-U.S. 

currency or currencies deposited with the trust 

which when aggregated in some specified minimum 

number may be surrendered to the trust or similar 

entity by the beneficial owner to receive the 

specified non-U.S. currency or currencies and pays 

the beneficial owner interest and other distributions 

on the deposited non-U.S. currency or currencies, 

if any, declared and paid by the trust (‘‘Currency 

Trust Shares’’); (3) represent commodity pool 

interests principally engaged, directly or indirectly, 

in holding and/or managing portfolios or baskets of 

securities, commodity futures contracts, options on 

commodity futures contracts, swaps, forward 

contracts and/or options on physical commodities 

and/or non-U.S. currency (‘‘Commodity Pool 

ETFs’’); (4) are issued by the SPDR® Gold Trust or 

the iShares COMEX Gold Trust or the iShares Silver 

Trust or the ETFS Silver Trust or the ETFS Gold 

Trust or the ETFS Palladium Trust or the ETFS 

Platinum Trust or the Sprott Physical Gold Trust; 

or (5) represent an interest in a registered 

investment company (‘‘Investment Company’’) 

organized as an open-end management company or 

similar entity, that invests in a portfolio of 

securities selected by the Investment Company’s 

investment adviser consistent with the Investment 

Company’s investment objectives and policies, 

which is issued in a specified aggregate minimum 

number in return for a deposit of a specified 

portfolio of securities and/or a cash amount with a 

value equal to the next determined net asset value 

(‘‘NAV’’), and when aggregated in the same 

specified minimum number, may be redeemed at a 

holder’s request, which holder will be paid a 

specified portfolio of securities and/or cash with a 

value equal to the next determined NAV (‘‘Managed 

Fund Share’’); provided that all of the conditions 

listed in (5)(i) and 5(ii) are met. 

5The Exchange notes several filings to list and 

trade ETFs that hold bitcoin as NMS stocks (and 

registration statements for those Units) are currently 

pending with the Securities and Exchange 

Commission (the ‘‘Commission’’). Pursuant to the 

Exchange’s Rules, the Exchange would only have 

authority to list and trade ETFs that are trading as 

NMS stocks. 

comments more efficiently, please use 

only one method. The Commission will 

post all comments on the Commission’s 

internet website (https://www.sec.gov/ 

rules/sro.shtml). 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–BOX–2024–05 and should be 

submitted on or before February 15, 

2024. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.13

Sherry R. Haywood, 

Assistant Secretary. 

[FR Doc. 2024–01393 Filed 1–24–24; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–99394; File No. SR– 

PEARL–2024–03] 

Self-Regulatory Organizations; MIAX 

PEARL LLC; Notice of Filing of a 

Proposed Rule Change To Amend 

Exchange Rule 402, Criteria for 

Underlying Securities 

January 19, 2024. 

Pursuant to the provisions of Section 

19(b)(1) of the Securities Exchange Act 

of 1934 (‘‘Act’’) 1 and Rule 19b–4 

thereunder,2 notice is hereby given that 

on January 12, 2024, MIAX PEARL LLC 

(‘‘MIAX Pearl’’ or ‘‘Exchange’’) filed 

with the Securities and Exchange 

Commission (‘‘Commission’’) a 

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. 

I. Self-Regulatory Organization’s 

Statement of the Terms of Substance of 

the Proposed Rule Change 

The Exchange proposes to amend 

Exchange Rule 402, Criteria for 

Underlying Securities. 

The text of the proposed rule change 

is available on the Exchange’s website at 

https://www.miaxglobal.com/markets/ 

us-options/pearl-options/rule-filings, at 

MIAX Pearl’s principal office, 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 

Exchange Rule 402, Criteria for 

Underlying Securities,3 to allow the 

Exchange to list and trade options on 

Exchange-Traded Fund Shares (‘‘ETFs’’) 

that represent interests in a trust that 

holds bitcoin (‘‘Bitcoin ETPs’’), 

designating them as ETFs deemed 

appropriate for options trading on the 

Exchange. 

Current Exchange Rule 402(i)(4) 

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,4 including interests in 

certain specific trusts that hold financial 

instruments, money market instruments, 

or precious metals (which are deemed 

commodities). 

Bitcoin ETPs are bitcoin-backed 

commodity ETPs structured as trusts.5

Similar to any ETFs currently deemed 

appropriate for options trading under 

Exchange Rule 402, the investment 

objective of a Bitcoin ETP trust is for its 

shares to reflect the performance of 

bitcoin (less the expenses of the trust’s 

operations), offering investors an 

opportunity to gain exposure to bitcoin 

without the complexities of bitcoin 

delivery. As is the case for ETFs 

currently deemed appropriate for 


khammond on DSKJM1Z7X2PROD with NOTICES