90 FR 89 pgs. 19772-19773 - Self-Regulatory Organizations; Nasdaq Stock Market LLC; Order Instituting Proceedings To Determine Whether To Approve or Disapprove a Proposed Rule Change To List and Trade Shares of the Canary Litecoin ETF Under Nasdaq Rule 5711(d) (Commodity-Based Trust Shares)
Type: NOTICEVolume: 90Number: 89Pages: 19772 - 19773
Pages: 19772, 19773Docket number: [Release No. 34-102988; File No. SR-NASDAQ-2025-005]
FR document: [FR Doc. 2025-08118 Filed 5-8-25; 8:45 am]
Agency: Securities and Exchange Commission
Official PDF Version: PDF Version
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-102988; File No. SR-NASDAQ-2025-005]
Self-Regulatory Organizations; Nasdaq Stock Market LLC; Order Instituting Proceedings To Determine Whether To Approve or Disapprove a Proposed Rule Change To List and Trade Shares of the Canary Litecoin ETF Under Nasdaq Rule 5711(d) (Commodity-Based Trust Shares)
May 5, 2025.
I. Introduction
On January 15, 2025, The Nasdaq Stock Market LLC ("Nasdaq") 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 Canary Litecoin ETF ("Trust") under Nasdaq Rule 5711(d). The proposed rule change was published for comment in the Federal Register on February 4, 2025. 3
Footnotes:
1 ?15 U.S.C. 78s(b)(1).
2 ?17 CFR 240.19b-4.
3 ? See Securities Exchange Act Release No. 102303 (Jan. 29, 2025), 90 FR 8949 ("Notice"). Comments received on the proposed rule change are available at: https://www.sec.gov/comments/sr-nasdaq-2025-005/srnasdaq2025005.htm.
On March 11, 2025, 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.
Footnotes:
4 ?15 U.S.C. 78s(b)(2).
5 ? See Securities Exchange Act Release No. 102585, 90 FR 12384 (Mar. 17, 2025). The Commission designated May 5, 2025, as the date by which the Commission shall approve or disapprove, or institute proceedings to determine whether to disapprove, the proposed rule change.
6 ?15 U.S.C. 78s(b)(2)(B).
II. 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 Nasdaq Rule 5711(d), which governs the listing and trading of Commodity-Based Trust Shares on the Exchange.
Footnotes:
7 ? See Notice, supra note 3.
According to the Exchange, the investment objective of the Trust is for the Shares to seek to track the performance of Litecoin ("LTC"), 8 as measured by the CoinDesk Litecoin Price Index (LTX)("Index"), adjusted for the Trust's expenses and other liabilities. 9 In seeking to achieve its investment objective, the Trust will hold LTC and will value its Shares daily as of 4:00 p.m. Eastern time ("ET") using the same methodology used to calculate the Index. 10 The Trust's assets will consist only of LTC and cash. 11 When the Trust sells or redeems its Shares, it will do so in cash transactions with authorized participants in blocks of 10,000 Shares. 12
Footnotes:
8 ?The Exchange states that LTC is a digital asset that is created and transmitted through the operations of the peer-to-peer, decentralized network of computers that operates on cryptographic protocols, known as the Litecoin Network. See id. at 8950.
9 ? See id. Canary Capital Group LLC is the sponsor of the Trust and CSC Delaware Trust Company is the trustee of the Trust. BitGo Trust Company, Inc. and Coinbase Custody Trust Company, LLC will be responsible for the custody of the Trust's LTC. U.S. Bancorp Fund Services, LLC will be the administrator of the Trust. See id. at 8949-50.
10 ? See id. at 8950. The Index is calculated by applying a weighting algorithm to the price and trading volume data for the immediately preceding 24-hour period as of 4:00 p.m., New York time, derived from the selected digital asset trading platforms. CoinDesk Indices, Inc. publishes the Index. See id. at 8951.
11 ? See id. at 8950.
12 ? See id.
III. Proceedings To Determine Whether To Approve or Disapprove SR-NASDAQ-2025-005 and Grounds for Disapproval Under Consideration
[top] The Commission is instituting proceedings pursuant to Section 19(b)(2)(B) of the Act? 13 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. Institution of proceedings
Footnotes:
13 ?15 U.S.C. 78s(b)(2)(B).
Pursuant to Section 19(b)(2)(B) of the Act, 14 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, which requires, among other things, that the rules of a national securities exchange be "designed to prevent fraudulent and manipulative acts and practices" and "to protect investors and the public interest."? 15
Footnotes:
14 ? Id.
15 ?15 U.S.C. 78f(b)(5).
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, in addition to any other comments they may wish to submit about the proposed rule change. In particular, the Commission seeks comment on whether the proposal to list and trade Shares of the Trust, which would hold LTC, is designed to prevent fraudulent and manipulative acts and practices or raises any new or novel concerns not previously contemplated by the Commission.
IV. Procedure: 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 proposal. In particular, the Commission invites the written views of interested persons concerning whether the proposal is consistent with Section 6(b)(5) or any other provision of the Act, and the rules and regulations 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. 16
Footnotes:
16 ?Section 19(b)(2) of the Act, as amended by the Securities Acts Amendments of 1975, Public Law 94-29 (June 4, 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, Senate Comm. on Banking, Housing & Urban Affairs, S. Rep. No. 75, 94th Cong., 1st Sess. 30 (1975).
Interested persons are invited to submit written data, views, and arguments regarding whether the proposed rule change should be approved or disapproved by May 30, 2025. Any person who wishes to file a rebuttal to any other person's submission must file that rebuttal by June 13, 2025.
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-NASDAQ-2025-005 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-NASDAQ-2025-005. 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-NASDAQ-2025-005 and should be submitted on or before May 30, 2025. Rebuttal comments should be submitted by June 13, 2025.
For the Commission, by the Division of Trading and Markets, pursuant to delegated authority. 17
Footnotes:
17 ?17 CFR 200.30-3(a)(57).
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2025-08118 Filed 5-8-25; 8:45 am]
BILLING CODE 8011-01-P