Federal Register / Vol. 86, No. 154 / Friday, August 13, 2021 / Notices 44761 

7 15 U.S.C. 78f(b)(8). 

8 15 U.S.C. 78s(b)(3)(A). 

9 17 CFR 240.19b–4(f)(2). 

10 15 U.S.C. 78s(b)(2)(B). 

11 17 CFR 200.30–3(a)(12). 

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

2 17 CFR 240.19b–4. 

situated market participants on an equal 

and non-discriminatory basis. The 

Exchange believes that eliminating 

optional DMM rebate and credits that 

are underutilized and ineffective would 

no longer be available to any DMM on 

an equal basis. Further, the proposal 

does not permit unfair discrimination 

because elimination of obsolete waivers 

would apply to all similarly situated 

member organizations on an equal basis. 

In addition, the Exchange believes that 

the proposed elimination of obsolete 

waivers would remove impediments to 

and perfect the mechanism of a free and 

open market by eliminating references 

to waivers that are no longer offered, 

thereby improving the clarity of the 

Exchange’s rules and enabling market 

participants to more easily navigate the 

Exchange’s Price List. The Exchange 

also believes that the proposed change 

would protect investors and the public 

interest because the deletion of 

underutilized and obsolete fees would 

make the Price List more accessible and 

transparent and facilitate market 

participants’ understanding of the fees 

charged for services currently offered by 

the Exchange. 

Finally, the Exchange believes that it 

is subject to significant competitive 

forces, as described below in the 

Exchange’s statement regarding the 

burden on competition. 

For the foregoing reasons, the 

Exchange believes that the proposal is 

consistent with the Act. 

B. Self-Regulatory Organization’s 

Statement on Burden on Competition 

In accordance with Section 6(b)(8) of 

the Act,7 the Exchange believes that the 

proposed rule change would not impose 

any burden on competition that is not 

necessary or appropriate in furtherance 

of the purposes of the Act. Instead, as 

discussed above, the proposal relates 

solely to elimination of an underutilized 

rebate and obsolete waivers and, as 

such, would not have any impact on 

intra- or inter-market competition 

because the proposed change is solely 

designed to accurately reflect the 

services that the Exchange currently 

offers, thereby adding clarity to the 

Price List. 

C. Self-Regulatory Organization’s 

Statement on Comments on the 

Proposed Rule Change Received From 

Members, Participants, or Others 

No written comments were solicited 

or received with respect to the proposed 

rule change. 

III. Date of Effectiveness of the 

Proposed Rule Change and Timing for 

Commission Action 

The foregoing rule change is effective 

upon filing pursuant to Section 

19(b)(3)(A) 8 of the Act and 

subparagraph (f)(2) of Rule 19b–4 9

thereunder, because it establishes a due, 

fee, or other charge imposed by the 

Exchange. 

At any time within 60 days of the 

filing of such proposed rule change, the 

Commission summarily may 

temporarily suspend such rule change if 

it appears to the Commission that such 

action is necessary or appropriate in the 

public interest, for the protection of 

investors, or otherwise in furtherance of 

the purposes of the Act. If the 

Commission takes such action, the 

Commission shall institute proceedings 

under Section 19(b)(2)(B) 10 of the Act to 

determine whether the proposed rule 

change 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 (http://www.sec.gov/ 

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number SR– 

NYSE–2021–41 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–NYSE–2021–41. 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 (http://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 

10:00 a.m. and 3:00 p.m. Copies of the 

filing also will be available for 

inspection and copying at the principal 

office of the Exchange. All comments 

received will be posted without change. 

Persons submitting comments are 

cautioned that we do not redact or edit 

personal identifying information from 

comment submissions. You should 

submit only information that you wish 

to make available publicly. All 

submissions should refer to File 

Number SR–NYSE–2021–41 and should 

be submitted on or before September 3, 

2021. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.11

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–17306 Filed 8–12–21; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–92617; File No. SR–FINRA– 

2021–008] 

Self-Regulatory Organizations; 

Financial Industry Regulatory 

Authority, Inc.; Notice of Filing of 

Amendment No. 1 and Order Instituting 

Proceedings To Determine Whether To 

Approve or Disapprove the Proposed 

Rule Change, as Modified by 

Amendment No. 1, Relating to 

Security-Based Swaps 

August 9, 2021. 

I. Introduction 

On April 26, 2021, the Financial 

Industry Regulatory Authority, Inc. 

(‘‘FINRA’’) filed with the Securities and 

Exchange Commission (‘‘Commission’’) 

the proposed rule change SR–FINRA– 

2021–008 (‘‘Proposed Rule Change’’) 

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

Securities Exchange Act of 1934 

(‘‘Exchange Act’’),1 and Rule 19b–4 2

thereunder, to amend FINRA Rules 

0180, 4120, 4210, 4220, 4240 and 9610 

to clarify the application of FINRA rules 

to security-based swaps (‘‘SBS’’) 

following the SEC’s completion of its 


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44762 Federal Register / Vol. 86, No. 154 / Friday, August 13, 2021 / Notices 

3Exchange Act Release No. 91789, (May 7, 2021), 

86 FR 26084 (May 12, 2021) (File No. SR–FINRA– 

2021–008) (‘‘Notice’’). 

4See id. 

5See letter from Robert McNamee, Assistant 

General Counsel, Office of General Counsel, FINRA, 

to Daniel Fisher, Division of Trading and Markets, 

Commission, dated June 14, 2021. 

6See letter from Robert McNamee, Assistant 

General Counsel, Office of General Counsel, FINRA 

to Vanessa Countryman, Secretary, Commission, 

dated August 9, 2021. 

7 15 U.S.C. 78s(b)(2)(B). 

8See Capital, Margin, and Segregation 

Requirements for Security-Based Swap Dealers and 

Major Security-Based Swap Participants and Capital 

and Segregation Requirements for Broker-Dealers, 

Exchange Act Release No. 86175, (Jun. 21, 2019), 84 

FR 43872 (Aug. 22, 2019) (File No. S7–08–12). 

9 15 U.S.C. 78s(b)(2)(B). 

10 Id. 

11Section 19(b)(2) of the Act, as amended by the 

Securities Acts Amendments of 1975, Public Law 

94–29, 89 Stat. 97 (1975), grants the Commission 

flexibility to determine what type of proceeding— 

either oral or notice and opportunity for written 

comments—is appropriate for consideration of a 

particular proposal by a self-regulatory 

organization. See Securities Acts Amendments of 

1975, Report of the Senate Committee on Banking, 

Housing and Urban Affairs to Accompany S. 249, 

S. Rep. No. 75, 94th Cong., 1st Sess. 30 (1975). 

rulemaking regarding SBS dealers 

(‘‘SBSDs’’) and major SBS participants 

(‘‘MSBSPs’’) (collectively, ‘‘SBS 

Entities’’).3 The Proposed Rule Change 

was published for public comment in 

the Federal Register on May 12, 2021.4

On June 14, 2021, FINRA consented to 

an extension of the time period in 

which the Commission must approve 

the Proposed Rule Change, disapprove 

the Proposed Rule Change, or institute 

proceedings to determine whether to 

approve or disapprove the Proposed 

Rule Change to August 10, 2021.5 On 

August 9, 2021, FINRA responded to the 

comment letters received in response to 

the Notice and filed an amendment to 

modify the Proposed Rule Change 

(‘‘Amendment No. 1’’).6 The 

Commission is publishing this order 

pursuant to Section 19(b)(2)(B) of the 

Exchange Act 7 to solicit comments on 

Amendment No. 1 from interested 

persons and to institute proceedings to 

determine whether to approve or 

disapprove the Proposed Rule Change, 

as modified by Amendment No. 1. 

II. Description of the Proposed Rule 

Change, as Modified by Amendment 

No. 1 

FINRA is proposing to amend FINRA 

Rules 0180, 4120, 4210, 4220, 4240 and 

9610 to take into account members’ SBS 

activities once SBS Entities begin 

registering with the Commission on 

October 6, 2021. The proposed 

amendments to these rules generally fall 

into three categories. First, the Proposed 

Rule Change, as modified by 

Amendment No. 1, would adopt a new 

FINRA Rule 0180, to replace expiring 

current FINRA Rule 0180, that would 

generally apply FINRA rules to 

members’ activities and positions with 

respect to SBS, while providing limited 

exceptions for those activities and 

positions in circumstances where 

FINRA believes such exceptions are 

appropriate. Second, the Proposed Rule 

Change, as modified by Amendment No. 

1, would amend FINRA’s financial 

responsibility and operational rules for 

SBSDs and broker-dealers to conform to 

the SEC’s amendments to its capital, 

margin and segregation requirements,8

and to otherwise take into account 

members’ SBS activities. Third, the 

Proposed Rule Change, as modified by 

Amendment No. 1, would adopt a new 

margin rule specifically applicable to 

SBS, which would replace the expiring 

interim pilot program establishing 

margin requirements for credit default 

swaps. 

Amendment No. 1 would make the 

following changes to the Proposed Rule 

Change: (1) Extend the effective date of 

the proposed amendments to FINRA 

Rules 0180, 4120 and 9610 from October 

6, 2021 to February 6, 2022; (2) extend 

the effective date of the proposed 

amendments to FINRA Rules 4210, 4220 

and 4240 from October 6, 2021 to April 

6, 2022; and (3) conform the proposed 

definition of Legacy Swap in proposed 

FINRA Rule 4240(d)(12) to reflect the 

new effective date of April 6, 2022. 

III. Proceedings To Determine Whether 

To Approve or Disapprove File No. SR– 

FINRA–2021–008 and Grounds for 

Disapproval Under Consideration 

The Commission is instituting 

proceedings pursuant to Section 

19(b)(2)(B) of the Exchange Act to 

determine whether the Proposed Rule 

Change, as modified by Amendment No. 

1, should be approved or disapproved.9

Institution of proceedings is appropriate 

at this time in view of the legal and 

policy issues raised by the Proposed 

Rule Change, as modified by 

Amendment No. 1. Institution of 

proceedings does not indicate that the 

Commission has reached any 

conclusions with respect to the 

Proposed Rule Change, as modified by 

Amendment No. 1. 

Pursuant to Section 19(b)(2)(B) of the 

Exchange Act,10 the Commission is 

providing notice of the grounds for 

disapproval under consideration. The 

Commission is instituting proceedings 

to allow for additional analysis and 

input concerning whether the Proposed 

Rule Change, as modified by 

Amendment No. 1, is consistent with 

the Exchange Act and the rules 

thereunder. 

IV. Request for Written Comments 

The Commission requests that 

interested persons provide written 

submissions of their views, data, and 

arguments with respect to the issues 

identified above, as well as any other 

concerns they may have with the 

Proposed Rule Change, as modified by 

Amendment No. 1. In particular, the 

Commission invites the written views of 

interested persons concerning whether 

the Proposed Rule Change, as modified 

by Amendment No. 1, is consistent with 

the Exchange Act and the rules 

thereunder. 

Although there do not appear to be 

any issues relevant to approval or 

disapproval that would be facilitated by 

an oral presentation of views, data, and 

arguments, the Commission will 

consider, pursuant to Rule 19b–4, any 

request for an opportunity to make an 

oral presentation.11

Interested persons are invited to 

submit written data, views, and 

arguments regarding whether the 

Proposed Rule Change, as modified by 

Amendment No. 1, should be approved 

or disapproved by August 30, 2021. Any 

person who wishes to file a rebuttal to 

any other person’s submission must file 

that rebuttal by September 3, 2021. 

Comments may be submitted by any 

of the following methods: 

Electronic Comments 

• Use the Commission’s internet 

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

rules/sro.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File No. SR– 

FINRA–2021–008 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 No. 

SR–FINRA–2021–008. 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 (http://www.sec.gov/ 

rules/sro.shtml). Copies of the 

submission, all subsequent 

amendments, all written statements 

with respect to the Proposed Rule 

Change, as modified by Amendment No. 

1, that are filed with the Commission, 

and all written communications relating 


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Federal Register / Vol. 86, No. 154 / Friday, August 13, 2021 / Notices 44763 

12 17 CFR 200.30–3(a)(12); 17 CFR 200.30– 

3(a)(57). 

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

2 17 CFR 240.19b–4. 

3See Securities Exchange Act Release No. 91771 

(May 6, 2021), 86 FR 26073 (May 12, 2021) 

(‘‘Notice’’). Comments on the proposed rule change 

can be found at: https://www.sec.gov/comments/srnysearca-2021-31/srnysearca202131.htm. 

4 15 U.S.C. 78s(b)(2). 

5See Securities Exchange Act Release No. 92233 

(June 22, 2021), 86 FR 34107 (June 28, 2021). The 

Commission designated August 10, 2021, as the 

date by which it should approve, disapprove, or 

institute proceedings to determine whether to 

disapprove the proposed rule change. 

6 15 U.S.C. 78s(b)(2)(B). 

7See Notice, supra note 3. 

8 Valkyrie Digital Assets LLC is the sponsor of the 

Trust (‘‘Sponsor’’) and Delaware Trust Company is 

the trustee. Coinbase Custody Trust Company, LLC 

(‘‘Custodian’’) will act as custodian for the Trust’s 

bitcoins. U.S. Bancorp Fund Services, LLC 

(‘‘Administrator’’) will act as the transfer agent and 

administrator of the Trust. See Notice, supra note 

3, 86 FR at 26073. 

9The Index is not affiliated with the Sponsor and 

is administered by CF Benchmarks Ltd. 

(‘‘Benchmark Administrator’’). See Notice, supra 

note 3, 86 FR at 26076. 

10See id. 

11See id. at 26073. 

12See id. at 26076. 

13See id. at 26081. 

14The BRTI is calculated in real time based on 

the universe of the currently unmatched limit 

orders to buy or sell in the BTC/USD pair of all 

Constituent Bitcoin Exchanges. See id. at 26076. 

to the Proposed Rule Change, as 

modified by Amendment No. 1, 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 

10:00 a.m. and 3:00 p.m. Copies of such 

filing also will be available for 

inspection and copying at the principal 

office of FINRA. 

All comments received will be posted 

without change. Persons submitting 

comments are cautioned that we do not 

redact or edit personal identifying 

information from comment submissions. 

You should submit only information 

that you wish to make available 

publicly. 

All submissions should refer to File 

No. SR–FINRA–2021–008 and should be 

submitted on or before August 30, 2021. 

If comments are received, any rebuttal 

comments should be submitted on or 

before September 3, 2021. 

For the Commission, by the Division of 

Trading and Markets, pursuant to delegated 

authority.12

J. Matthew DeLesDernier, 

Assistant Secretary. 

[FR Doc. 2021–17307 Filed 8–12–21; 8:45 am] 

BILLING CODE 8011–01–P 

SECURITIES AND EXCHANGE 

COMMISSION 

[Release No. 34–92610; File No. SR– 

NYSEArca–2021–31] 

Self-Regulatory Organizations; NYSE 

Arca, Inc.; Order Instituting 

Proceedings To Determine Whether To 

Approve or Disapprove a Proposed 

Rule Change To List and Trade Shares 

of the Valkyrie Bitcoin Fund Under 

NYSE Arca Rule 8.201–E 

August 9, 2021. 

On April 23, 2021, NYSE Arca, Inc. 

(‘‘NYSE Arca’’ or ‘‘Exchange’’) filed 

with the Securities and Exchange 

Commission (‘‘Commission’’), pursuant 

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

Exchange Act of 1934 (‘‘Act’’) 1 and Rule 

19b–4 thereunder,2 a proposed rule 

change to list and trade shares 

(‘‘Shares’’) of the Valkyrie Bitcoin Fund 

(‘‘Trust’’) under NYSE Arca Rule 8.201– 

E (Commodity-Based Trust Shares). The 

proposed rule change was published for 

comment in the Federal Register on 

May 12, 2021.3

On June 22, 2021, pursuant to Section 

19(b)(2) of the Act,4 the Commission 

designated a longer period within which 

to approve the proposed rule change, 

disapprove the proposed rule change, or 

institute proceedings to determine 

whether to disapprove the proposed 

rule change.5 This order institutes 

proceedings under Section 19(b)(2)(B) of 

the Act 6 to determine whether to 

approve or disapprove the proposed 

rule change. 

I. Summary of the Proposal 

As described in more detail in the 

Notice,7 the Exchange proposes to list 

and trade the Shares of the Trust under 

NYSE Arca Rule 8.201–E, which 

governs the listing and trading of 

Commodity-Based Trust Shares on the 

Exchange. 

The investment objective of the Trust 

will be for the Shares to reflect the 

performance of the value of a bitcoin as 

represented by the CF Bitcoin US 

Settlement Price (‘‘Index’’), less the 

Trust’s liabilities and expenses.8 The 

Fund will use the Index to calculate the 

Trust’s net asset value (‘‘NAV’’).9 The 

Index serves as a once-a-day benchmark 

rate of the U.S. dollar price of bitcoin 

(USD/BTC), calculated as of 4:00 p.m., 

E.T. The Index aggregates the trade flow 

of several bitcoin exchanges, during an 

observation window between 3:00 p.m. 

and 4:00 p.m., E.T., into the U.S. dollar 

price of one bitcoin at 4:00 p.m., E.T. 

The current constituent bitcoin 

exchanges of the Index are Bitstamp, 

Coinbase, Gemini, itBit, and Kraken 

(‘‘Constituent Bitcoin Exchanges’’). In 

calculating the Index, the methodology 

creates a joint list of certain trade prices 

and sizes from the Constituent Bitcoin 

Exchanges between 3:00 p.m. and 4:00 

p.m., E.T. The methodology then 

divides this list into 12 equally-sized 

time intervals of 5 minutes and it 

calculates the volume-weighted median 

trade price for each of those time 

intervals. The Index is the arithmetic 

mean of these 12 volume-weighted 

median trade prices.10

The Shares of the Trust represent 

units of fractional undivided beneficial 

interest in, and ownership of, the Trust. 

The Trust will only hold bitcoin. The 

Custodian will establish accounts that 

hold the bitcoins deposited with the 

Custodian on behalf of the Trust.11

The Administrator will calculate the 

NAV of the Trust once each Exchange 

trading day. The Sponsor will publish 

the NAV and NAV per Share as soon as 

practicable after their determination and 

availability, and the NAV will be 

released after the end of the Core 

Trading Session (4:00 p.m., E.T.). The 

NAV of the Trust is not officially struck 

until later in the day (often by 5:30 p.m., 

E.T, and usually by 8:00 p.m., E.T.). The 

Trust’s NAV per Share is calculated by 

taking the current market value of its 

total assets, less any liabilities of the 

Trust, and dividing that total by the 

total number of outstanding Shares. The 

bitcoin held by the Trust will be valued 

based on the price set by the Index.12

The Trust will provide website 

disclosure of its bitcoin holdings 

daily.13 The Trust will also disseminate 

an intraday indicative value (‘‘IIV’’) per 

Share updated every 15 seconds by one 

of more major market data vendors 

during the Exchange’s Core Trading 

Session (normally 9:30 a.m. to 4:00 

p.m., E.T.). The IIV will be calculated by 

a third-party financial data provider 

using the prior day’s closing NAV per 

Share of the Trust as a base and 

updating that value throughout the 

trading day to reflect changes in the 

most recently reported price level of the 

CME CF Bitcoin Real-Time Index 

(‘‘BRTI’’), as reported by CME Group, 

Inc., Bloomberg, L.P., or another 

reporting service.14

The Trust will issue and redeem 

Shares to authorized participants on an 

ongoing basis in one or more ‘‘Baskets’’ 

of 50,000 Shares. The creation and 

redemption of a Basket requires the 

delivery to the Trust, or the distribution 

by the Trust, of the number of whole 

and fractional bitcoins represented by 


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