[Federal Register Volume 89, Number 84 (Tuesday, April 30, 2024)]
[Notices]
[Pages 34295-34298]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-09217]



[[Page 34295]]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-100023; File No. SR-NYSEARCA-2024-06]


Self-Regulatory Organizations; NYSE Arca, Inc.; Order Instituting 
Proceedings To Determine Whether To Approve or Disapprove a Proposed 
Rule Change To Amend Exchange Rule 5.3-O To Permit the Listing and 
Trading of Options on Commodity-Based Trust Shares

April 24, 2024.

I. Introduction

    On January 16, 2024, 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 (the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ a 
proposed rule change to amend NYSE Arca Rule 5.3-O(g) to permit the 
listing and trading of options on Commodity-Based Trust Shares.\3\ The 
proposed rule change was published for comment in the Federal Register 
on January 25, 2024.\4\ The Commission received comment letters 
regarding the proposed rule change.\5\ On March 6, 2024, pursuant to 
Section 19(b)(2) of the Act,\6\ 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 
approve or disapprove the proposed rule change.\7\ This order 
institutes proceedings pursuant to Section 19(b)(2)(B) of the Act \8\ 
to determine whether to approve or disapprove the proposed rule change.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See NYSE Arca Rule 8.201-E(c)(1).
    \4\ See Securities Exchange Act Release No. 99398 (Jan. 19, 
2024), 89 FR 5029 (``Notice'').
    \5\ Comment letters can be accessed at https://www.sec.gov/comments/sr-nysearca-2024-06/srnysearca202406.htm.
    \6\ 15 U.S.C. 78s(b)(2).
    \7\ See Securities Exchange Act Release No. 99683 (Mar. 6, 
2024), 89 FR 17888 (Mar. 12, 2024). The Commission designated April 
24, 2024, as the date by which the Commission shall approve or 
disapprove, or institute proceedings to determine whether to approve 
or disapprove, the proposed rule change.
    \8\ 15 U.S.C. 78s(b)(2)(B).
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II. Description of the Proposed Rule Change

    As described in greater detail in the Notice,\9\ Exchange Rule 5.3-
O(g) deems appropriate for options trading certain Exchange-Traded Fund 
Shares (``ETFs'') that are traded on a national securities exchange and 
are defined as an ``NMS stock'' in Rule 600 of Regulation NMS.\10\ The 
Exchange proposed to amend Exchange Rule 5.3-O(g) to expand the types 
of ETFs that may be approved for options trading to include Commodity-
Based Trust Shares, as defined in Exchange Rule 8.201-E (``Commodity-
Based Trust Shares'').\11\ The Exchange stated that it would consider 
listing and trading options on Commodity-Based Trust that (1) meet the 
criteria for underlying securities set forth in Exchange Rule 5.3-O(a) 
\12\-(b),\13\ or (2) are available for creation and redemption each 
business day as set forth in Exchange Rule 5.3-O(g)(1)(B).\14\ The 
Exchange stated that the current continued listing standards for 
options on ETFs also will apply to options on Commodity-Based Trust 
Shares.\15\ In addition, the Exchange stated that options on Commodity-
Based Trust Shares would be subject to the Exchange's rules and 
procedures governing the trading of equity options, including margin 
requirements and position and exercise limits.\16\
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    \9\ See supra note 4.
    \10\ 17 CFR 242.600. See Notice, 89 FR at 5029. The Exchange's 
rules use the term ``exchange traded fund'' to refer to several 
types of investment products. Exchange Rule 5.3-O(g) states that 
``Securities deemed appropriate for options trading shall include 
shares or other securities (``Exchange-Traded Fund Shares'' or 
``Fund Shares'') that are traded on a national securities exchange 
and are defined as an ``NMS stock'' in Rule 600(b)(55) of Regulation 
NMS, and that (i) represent an interest in a registered investment 
company organized as an open-end management investment company, a 
unit investment trust or a similar entity which holds securities 
and/or financial instruments, 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'') constituting or 
otherwise based on or representing an investment in an index or 
portfolio of securities and/or Financial Instruments and Money 
Market Instruments, or (ii) represent interests in a trust or 
similar entity that holds a specified non-U.S. currency deposited 
with the trust or similar entity when aggregated in some specified 
minimum number may be surrendered to the trust by the beneficial 
owner to receive the specified non-U.S. currency and pays the 
beneficial owner interest and other distributions on the deposited 
non-U.S. currency, if any, declared and paid by the trust; or (iii) 
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 
Units''), or (iv) represent interests in the SPDR Gold Trust, or (v) 
represent interests in the iShares COMEX Gold Trust, or (vi) 
represent interests in the iShares Silver Trust, (vii) represents an 
interest in a registered investment company (``Investment Company'') 
organized as an open-end management investment 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''), or, (viii) 
represents interests in the ETFS Silver Trust or ETFS Gold Trust, 
or, (ix) represents interests in the ETFS Palladium Trust or ETFS 
Platinum Trust, provided. . . .'' In describing the proposal, for 
purposes of this Order, the terms ``Exchange-Traded Fund'' and 
``ETF'' have the meaning set forth in the Exchange's rules.
    \11\ See Notice, 89 FR at 5030. The Exchange stated that the 
term ''Commodity-Based Trust Shares'' means a security (a) that is 
issued by a trust (``Trust'') that holds (1) a specified commodity 
deposited with the Trust, or (2) a specified commodity and, in 
addition to such specified commodity, cash; (b) that is issued by 
such Trust in a specified aggregate minimum number in return for a 
deposit of a quantity of the underlying commodity and/or cash; and 
(c) that, when aggregated in the same specified minimum number, may 
be redeemed at a holder's request by such Trust which will deliver 
to the redeeming holder the quantity of the underlying commodity 
and/or cash. See Notice, 89 FR at 5029, n.4, and NYSE Arca Rule 
8.201-E(c)(1).
    \12\ The Exchange stated that NYSE Arca Rule 5.3-O(a) sets forth 
minimum requirements for a security underlying an option, including 
that the underlying security have 7,000,000 shares, 2,000 
shareholders, and trading volume of 2,400,000 shares over the 
preceding 12 months The Exchange stated that the rule requires that 
the market price per share of the underlying security be at least 
$7.50 for the majority of business days during the three calendar 
months preceding the date of selection of an option class. The 
Exchange stated that tor underlying securities that are deemed 
Covered Securities, as defined under Section 18(b)(1)(A) of the 
Securities Act of 1933, the closing market price of the underlying 
security must be at least $3.00 per share for the previous three 
consecutive business days prior to the date of selection of an 
option class. See Notice, 89 FR at 5030, n. 8.
    \13\ The Exchange stated that NYSE Arca Rule 5.3-O(b) states 
that the underlying securities will be registered and be an ``NMS 
Stock'' as defined in Rule 600 of Regulation NMS under the Act. See 
Notice, 89 FR at 5030, n. 9.
    \14\ See Notice, 89 FR at 5030.
    \15\ See Notice, 89 FR at 5030.
    \16\ See Notice, 89 FR at 5031. The Exchange stated that 
pursuant to NYSE Arca Rule 6.8-O, Commentary .05 and .06, Commodity-
Based Trust Shares would be subject to the same position limits 
applicable to options on stocks and ETFs. In addition, the Exchange 
stated that NYSE Arca Rule 6.9-O provides that exercise limits for 
options on stocks and other securities, including Commodity-Based 
Trust Shares, will be the same as the position limits applicable 
under NYSE Arca Rule 6.8-O. See Notice, 89 FR at 5031, n. 14.
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    Currently, the position limits for options on stocks and ETF shares 
are 25,000 contracts, 50,000 contracts, 75,000 contracts, 200,000 
contracts, or 250,000 contracts on the same side of the market based on 
the six-month trading volume or the six-month trading volume and number 
of outstanding shares of the underlying security.\17\ A position limit 
of 25,000 contracts on the same side of the market applies to

[[Page 34296]]

options on securities that do not qualify for a higher limit.\18\ To be 
eligible for the 50,000-contract limit, the most recent six-month 
trading volume of the underlying security must have totaled at least 
20,000,000 shares; or the most recent six-month trading volume of the 
underlying security must have totaled at least 15,000,000 shares and 
the underlying security must have at least 40,000,000 shares currently 
outstanding.\19\ To be eligible for the 75,000-contract limit, the most 
recent six-month trading volume of the underlying security must have 
totaled at least 40,000,000 shares; or the most recent six-month 
trading volume of the underlying security must have totaled at least 
30,000,000 shares and the underlying security must have at least 
120,000,000 shares currently outstanding.\20\ To be eligible for the 
200,000-contract limit, the most recent six-month trading volume of the 
underlying security must have totaled at least 80,000,000 shares; or 
the most recent six-month trading volume of the underlying security 
must have totaled at least 60,000,000 shares and the underlying 
security must have at least 240,000,000 shares currently 
outstanding.\21\ To be eligible for the 250,000-contract limit, the 
most recent six-month trading volume of the underlying security must 
have totaled at least 100,000,000 shares; or the most recent six-month 
trading volume of the underlying security must have totaled at least 
75,000,000 shares and the underlying security must have at least 
300,000,000 shares currently outstanding.\22\
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    \17\ See NYSE Arca Rule 6.8-O.
    \18\ See NYSE Arca Rule 6.8-O, Commentary .06(c).
    \19\ See NYSE Arca Rule 6.8-O, Commentary .06(b).
    \20\ See NYSE Arca Rule 6.8-O, Commentary .06(a).
    \21\ See NYSE Arca Rule 6.8-O, Commentary .06(d).
    \22\ See NYSE Arca Rule 6.8-O, Commentary .06(e).
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    The Exchange stated that options on Commodity-Based Trust Shares 
would not be available for trading until The Options Clearing 
Corporation (``OCC'') represented to the Exchange that OCC was fully 
able to clear and settle such options.\23\ The Exchange further stated 
that it had analyzed its capacity and it represented that both the 
Exchange and the Options Price Reporting Authority LLC (``OPRA'') have 
the necessary systems capacity to handle the additional traffic that 
would be associated with the listing of options on Commodity-Based 
Trust Shares.\24\
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    \23\ See Notice, 89 FR at 5031.
    \24\ See Notice, 89 FR at 5031.
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    The Exchange stated that it believes that its surveillance 
procedures are adequate to properly monitor the trading of options on 
Commodity-Based Trust Shares in all trading sessions and to deter and 
detect violations of the Exchange's rules.\25\ The Exchange stated that 
it would utilize its existing surveillance procedures applicable to 
options on ETFs (which the Exchange stated will include Commodity-Based 
Trust Shares) to monitor such trading.\26\ In addition, the Exchange 
stated that it would implement any new surveillance procedures it 
deemed necessary to effectively monitor the trading of options on 
Commodity-Based Trust Shares, including adequate comprehensive 
surveillance sharing agreements (``CSSA'') with markets trading in non-
U.S. components, as applicable.\27\ The Exchange stated that it may 
obtain trading information via the Intermarket Surveillance Group 
(``ISG'') from other exchanges who are members or affiliates of the 
ISG.\28\ The Exchange represented that these procedures would be 
adequate to properly monitor Exchange trading of options on Commodity-
Based Trust Shares and to deter and detect violations of Exchange 
rules.\29\
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    \25\ See Notice, 89 FR at 5031.
    \26\ See Notice, 89 FR at 5031.
    \27\ See Notice, 89 FR at 5031. The Exchange stated that NYSE 
Arca Rule 5.3-O(g)(2) provides the applicable CSSA requirements for 
options on ETFs. See Notice, 89 FR at 5031, n. 17.
    \28\ See Notice, 89 FR at 5031.
    \29\ See Notice, 89 FR at 5031.
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    The Exchange stated that in approving Commodity-Based Trust Shares 
for equities exchange trading, the Commission thoroughly considered the 
structure of the Commodity-Based Trust Shares, their usefulness to 
investors and to the markets, and the exchange rules governing their 
trading.\30\ The Exchange stated that amending Exchange Rule 5.3-O(g) 
to allow the listing of options on Commodity-Based Trust Shares would 
allow options on Commodity-Based Trust Shares that have satisfied the 
generic listing standards to commence trading without the need for a 
public comment period and Commission approval.\31\ The Exchange further 
stated that the proposal has the potential to significantly reduce the 
time frame and costs associated with bringing options on Commodity-
Based Trust Shares to market, thereby reducing the burden on issuers 
and other market participants, while also promoting competition among 
options exchanges.\32\
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    \30\ See Notice, 89 FR at 5031.
    \31\ See Notice, 89 FR at 5031.
    \32\ See Notice, 89 FR at 5031.
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III. Summary of Comments Received

    The Commission received comment letters regarding the proposal.\33\ 
One commenter stated that ``option trading should be automatic for any 
NMS security that otherwise meets an exchange's quantitative listing 
standards.'' \34\ Another commenter stated that although NYSE Arca Rule 
5.3-O(g) permits options trading for entire classes of investment 
products, such as open-end investment companies or unit investment 
trusts, the listing of options on spot commodity-based exchange-traded 
products is subject to review on a product-by-product basis.\35\ 
According to this commenter, this ``result[s] in a patchwork rule 
wherein additional individual commodity-based ETPs are tacked on to 
NYSE Arca Rule 5.3-O(g) and NYSE American Rule 915, rather than being 
approved as a class.'' \36\ This commenter characterized this product-
by-product approach for commodity-based exchange-traded products 
(``ETPs'') as expensive and time-consuming \37\ and urged the 
Commission to ``update its outdated historical patchwork approach to 
approval of options on spot commodity-based ETPs that are structured 
identically to those spot commodity-ETPs for which the listing and 
trading on a national securities exchange has been approved . . . and 
permit national securities exchanges to update their rules to permit 
the deemed approval of the listing and trading of such options.'' \38\
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    \33\ See supra note 5.
    \34\ Letter from James J. Angel, Associate Professor of Finance, 
Georgetown University, to the Commission, dated March 10, 2024 
(``Angel Letter'') at 6.
    \35\ See Letter from Michael Sonnenshein, on behalf of Grayscale 
Investments, LLC and GBTC investors, to Vanessa Countryman, 
Secretary, Commission, dated February 28, 2024 (``Grayscale 
Letter'') at 6.
    \36\ Grayscale Letter at 6.
    \37\ See Grayscale Letter at 5.
    \38\ Grayscale Letter at 2.
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    One commenter stated that options are an efficient risk management 
tool that give investors the ability to take on or reduce risk.\39\ The 
commenter further stated that because ``the price trajectories of the 
spot- and futures-based bitcoin ETFs are virtually identical,'' options 
on these securities should have the same regulatory treatment.\40\ 
Another commenter stated that options on spot bitcoin ETPs would 
facilitate price discovery in the shares of the underlying ETP, improve 
market efficiency, and help investors achieve desired investment 
outcomes, such as

[[Page 34297]]

generating income, hedging, or reducing volatility.\41\ In addition, 
the commenter stated that approving the listing and trading of options 
on spot Bitcoin ETPs ``would further bring Bitcoin into the regulatory 
perimeter by allowing additional regulated market participants such as 
CFTC-regulated designated contract merchants and SEC-regulated broker-
dealers to trade the products.\42\
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    \39\ See Angel Letter at 8.
    \40\ Angel Letter at 4.
    \41\ See Grayscale Letter at 3.
    \42\ Grayscale Letter at 3.
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IV. Proceedings To Determine Whether To Approve or Disapprove SR-
NYSEARCA-2024-06 and Grounds for Disapproval Under Consideration

    The Commission is instituting proceedings pursuant to Section 
19(b)(2)(B) of the Act \43\ to determine whether the proposed rule 
change should be approved or disapproved. Institution of proceedings is 
appropriate at this time in view of the legal and policy issues raised 
by the proposed rule change, as discussed below. Institution of 
proceedings does not indicate that the Commission has reached any 
conclusions with respect to any of the issues involved. Rather, as 
described below, the Commission seeks and encourages interested persons 
to provide comments on the proposed rule change.
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    \43\ 15 U.S.C. 78s(b)(2)(B).
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    Pursuant to Section 19(b)(2)(B) of the Act,\44\ the Commission is 
providing notice of the grounds for disapproval under consideration. 
The Commission is instituting proceedings to allow for additional 
analysis of the proposed rule change's consistency with Section 6(b)(5) 
of the Act,\45\ which requires, among other things, that the rules of a 
national securities exchange be 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 a national market system and, in general, 
to protect investors and the public interest.
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    \44\ 15 U.S.C. 78s(b)(2)(B).
    \45\ 15 U.S.C. 78f(b)(5).
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    Under the Commission's Rules of Practice, the ``burden to 
demonstrate that a proposed rule change is consistent with the [Act] 
and the rules and regulations issued thereunder . . . is on the self-
regulatory organization that proposed the rule change.'' \46\ The 
description of a proposed rule change, its purpose and operation, its 
effect, and a legal analysis of its consistency with applicable 
requirements must all be sufficiently detailed and specific to support 
an affirmative Commission finding,\47\ and any failure of a self-
regulatory organization to provide this information may result in the 
Commission not having a sufficient basis to make an affirmative finding 
that a proposed rule change is consistent with the Act and the 
applicable rules and regulations.\48\
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    \46\ Rule 700(b)(3), Commission Rules of Practice, 17 CFR 
201.700(b)(3).
    \47\ See id.
    \48\ See id.
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    To date, the Commission has only approved listing rules for options 
on shares of spot commodity-based ETPs for specific ETPs, not classes 
of ETPs.\49\ For example, Exchange Rule 5.3-O(g) currently permits the 
listing of options on securities that represent interests in the SPDR 
Gold Trust, the iShares COMEX Gold Trust, the iShares Silver Trust, the 
ETFS Silver Trust, the ETFS Palladium Trust, or ETFS Platinum Trust. 
The Exchange proposes to replace this product-by-product approach and 
amend Exchange Rule 5.3-O(g) to permit the listing of options on 
securities that represent interests in Commodity-Based Trust Shares, as 
defined in Exchange Rule 8.201-E. The proposal would allow the Exchange 
to list options on any Commodity-Based Trust Share without filing a 
proposed rule change with the Commission.\50\ The Exchange stated that 
the Commission previously has approved generic listing standards 
pursuant to Rule 19b-4(e) under the Act \51\ that permit the listing of 
options on ETFs based on indexes that consist of stocks listed on U.S. 
exchanges.\52\ The Exchange stated that the Commission also previously 
has approved generic listing standards that permit the listing of 
options on ETFs based on international or global indexes.\53\ In 
addition, in contrast to the product-by-product approval of options on 
spot-commodity-based ETPs, Exchange Rule 5.3-O(g) provides for the 
listing and trading of options on general groups of investment 
products, including, among others, open-end investment companies or 
unit investment trusts that may hold securities, certain financial 
instruments, and money market instruments.
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    \49\ See, e.g., Securities Exchange Act Release Nos. 94928 (May 
17, 2022), 87 FR 31287 (May 23, 2022) (File No. SR-CBOE-2022-09) 
(order approving a proposed rule change to list and trade options on 
shares of the Goldman Sachs Physical Gold ETF); 61983 (Apr. 26, 
2010), 75 FR 23314 (May 3, 2010) (File No. SR-ISE-2010-19) (order 
approving a proposed rule change to list and trade options on shares 
of the ETFS Palladium Trust and the ETFS Platinum Trust); 61483 
(Feb. 3, 2010), 75 FR 6753 (Feb. 10, 2010) (File Nos. SR-SR-CBOE-
2010-007; SR-ISE-2009-106; SR-NYSEAmex-2009-86; and SR-NYSEArca-
2009-110) (approving proposals to list and trade options on shares 
of the ETFS Gold Trust and the ETFS Silver Trust); 59055 (December 
4, 2008), 73 FR 75148 (December 10, 2008) (File Nos. SR-Amex-2008-
68; SR-BSE-2008-51; SR-CBOE-2008-72; SR-ISE-2008-58; SR-NYSEArca-
2008-66; and SR-Phlx-2008-58) (order approving the listing and 
trading of options on shares of the iShares COMEX Gold Trust and the 
iShares Silver Trust); 57894 (May 30, 2008), 73 FR 32061 (June 5, 
2008) (File Nos. SR-Amex-2008-15; SR-CBOE-2005-11; SR-ISE-2008-12; 
SR-NYSEArca-2008-52; and SR-Phlx-2008-17) (order approving the 
listing and trading of options on shares of the SPDR Gold Trust).
    \50\ See Notice, 89 FR at 5030, 5032.
    \51\ 17 CFR 240.19b-4(e).
    \52\ See Notice, 89 FR at 5031, and Securities Exchange Act 
Release No. 42787, 65 FR 33598 (May 24, 2000) (order approving File 
No. SR-Amex-00-14).
    \53\ See Securities Exchange Act Release No. 54379 (November 9, 
2006), 71 FR 66993 (November 17, 2006) (order approving File No. SR-
AMEX-2006-78).
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    Options on Commodity-Based Trusts could result in additional demand 
for creations and redemptions of shares of the underlying Commodity-
Based Trust from options market makers seeking to hedge their 
positions. These additional creations and redemptions could increase 
demand for the underlying commodity. In addition, options market makers 
could seek to hedge their positions by transacting in the underlying 
commodity or using commodity derivatives. These additional demands for 
the underlying commodity have the potential to result in limited 
availability of the underlying commodity during times of market 
volatility which, in turn, could affect the creation and redemption 
process for Commodity-Based Shares. The spot markets for the underlying 
commodities that Commodity-Based Trusts may hold could vary 
significantly in terms of trading volumes, market concentration, market 
participants, commercial realities, and delivery practices, among other 
things. These dynamics raise questions as to whether, given the 
potentially significant differences in the spot markets for the 
underlying commodities, it is appropriate for the Commission to allow 
the Exchange to list options on any Commodity-Based Trust Share without 
filing a proposed rule change with the Commission, rather than 
continuing to review such proposals on a product-by-product basis. A 
product-specific approach would allow the Exchange to provide the 
Commission with information regarding the market for the underlying 
commodity that a trust holds and help to demonstrate that listing 
options on Commodity-Based Trust Shares representing interests in that 
trust would not result in adverse market impacts, such as a shortage in 
the supply of the underlying commodity, which, among other things, 
could affect the creation and redemption process for

[[Page 34298]]

the Commodity-Based Trust Shares. In addition, the proposal states that 
options on Commodity-Based Trust Shares would be subject to the same 
position limits applicable to options on stocks and ETFs.\54\ 
Instituting proceedings allows for comment on whether those position 
limits are appropriate for options on Commodity-Based Trust Shares in 
light of the significant differences between the underlying stock and 
ETF markets versus the markets for physical commodities.
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    \54\ See Notice, 89 FR at 5031, n. 14.
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V. Procedure: Request for Written Comments

    The Commission requests that interested persons provide written 
submissions of their data, views, and arguments with respect to the 
issues identified above, as well as any other concerns they may have 
with the proposal. In particular, the Commission invites the written 
views of interested persons concerning whether the proposed rule change 
is consistent with Section 6(b)(5), or any other provision of the Act, 
or the rules and regulations thereunder. Although there do not appear 
to be any issues relevant to approval or disapproval which would be 
facilitated by an oral presentation of data, views, and arguments, the 
Commission will consider, pursuant to Rule 19b-4 under the Act,\55\ any 
request for an opportunity to make an oral presentation.\56\
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    \55\ 17 CFR 240.19b-4.
    \56\ Section 19(b)(2) of the Act, as amended by the Securities 
Acts Amendments of 1975, Public Law 94-29 (June 4, 1975), grants to 
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, 
Senate Comm. on Banking, Housing & Urban Affairs, S. Rep. No. 75, 
94th Cong., 1st Sess. 30 (1975).
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    Interested persons are invited to submit written data, views, and 
arguments regarding whether the proposed rule change should be approved 
or disapproved by May 21, 2024. Any person who wishes to file a 
rebuttal to any other person's submission must file that rebuttal by 
June 4, 2024. The Commission asks that commenters address the 
sufficiency of the Exchange's statements in support of the proposal, 
which are set forth in the Notice,\57\ in addition to any other 
comments they may wish to submit about the proposed rule change. In 
particular, the Commission seeks comment on the following questions and 
asks commenters to submit data where appropriate to support their 
views:
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    \57\ See supra note 4.
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    1. Whether, given the potentially significant differences in the 
markets for the underlying commodities, the Exchange has provided 
sufficient data and analysis to support a conclusion that it is not 
necessary for the Commission to review and approve the listing and 
trading of options on ETPs, including Commodity-Based Trust Shares, on 
a product-by-product basis;
    2. Whether options on Commodity-Based Trust Shares should be 
subject to the same position and exercise limits as options on stock, 
and whether the available supply in the markets for the commodity on 
which the Commodity-Based Trust Shares are based is relevant in 
determining the position and exercise limits for options on Commodity-
Based Trust Shares; and
    3. Whether the listing of options on Commodity-Based Trust Shares 
for certain commodities should be subject to scrutiny on a product-by-
product basis because of the potential differences in the underlying 
spot markets, such as deliverable supply, trading volumes, and the 
involvement of commercial or financial participants.
    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 [email protected]. Please include 
File No. SR-NYSEARCA-2024-06 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-NYSEARCA-2024-06. 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-NYSEARCA-2024-06 and should 
be submitted by May 21, 2024. Rebuttal comments should be submitted by 
June 4, 2024.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\58\
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    \58\ 17 CFR 200.30-3(a)(57).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024-09217 Filed 4-29-24; 8:45 am]
BILLING CODE 8011-01-P