Self-Regulatory Organizations; Nasdaq BX, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Position and Exercise Limits for Options on the iShares Bitcoin Trust ETF, the Grayscale Bitcoin Mini Trust ETF, the Bitwise Bitcoin ETF, and the Grayscale Bitcoin Trust ETF

<NOTICE> SECURITIES AND EXCHANGE COMMISSION <DEPDOC>[Release No. 34-103638; File No. SR-BX-2025-014]</DEPDOC> <SUBJECT>Self-Regulatory Organizations; Nasdaq BX, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change To Amend Position and Exercise Limits for Options on the iShares Bitcoin Trust ETF, the Grayscale Bitcoin Mini Trust ETF, the Bitwise Bitcoin ETF, and the Grayscale Bitcoin Trust ETF</SUBJECT> <DATE>August 5, 2025.</DATE> Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (“Act”), <SU>1</SU> <FTREF/> and Rule 19b-4 thereunder, <SU>2</SU> <FTREF/> notice is hereby given that on August 1, 2025, Nasdaq BX, Inc. (“Exchange”) filed with the Securities and Exchange Commission (“Commission”) the 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. <FTNT> <SU>1</SU>  15 U.S.C. 78s(b)(1). </FTNT> <FTNT> <SU>2</SU>  17 CFR 240.19b-4. </FTNT> <HD SOURCE="HD1">I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change</HD> The Exchange proposes to amend Options 9, Section 13, Position Limits, and Options 9, Section 15, Exercise Limits, with respect to options on the iShares Bitcoin Trust ETF (“IBIT”), the Grayscale Bitcoin Mini Trust ETF (“BTC”), the Bitwise Bitcoin ETF (“BITB”) and the Grayscale Bitcoin Trust ETF (“GBTC”). The text of the proposed rule change is available on the Exchange's website at <E T="03">https://listingcenter.nasdaq.com/rulebook/bx/rulefilings</E> and at the principal office of the Exchange. <HD SOURCE="HD1">II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change</HD> 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. <HD SOURCE="HD2">A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change</HD> <HD SOURCE="HD3">1. Purpose</HD> The Exchange proposes to amend Options 9, Section 13, Position Limits, and Options 9, Section 15, Exercise Limits, with respect to options on the iShares Bitcoin Trust ETF (“IBIT”), the Grayscale Bitcoin Mini Trust ETF (“BTC”), the Bitwise Bitcoin ETF (“BITB”) and the Grayscale Bitcoin Trust ETF (“GBTC”). Each change will be described below. <HD SOURCE="HD3">Position Limits</HD> The Exchange proposes to amend its rules relating to position limits at Options 9, Section 13, and exercise limits at Options 9, Section 15. Recently, Nasdaq ISE, LLC (“ISE”) received approval to eliminate the current 25,000 contract position and exercise limit for options on IBIT. <SU>3</SU> <FTREF/> As a result, ISE would apply the position limits as determined by ISE Options 9, Section 13(d) to options on IBIT and exercise limits as determined by ISE Options 9, Section 15. Additionally, recently, NYSE Arca, Inc. (“Arca”) received approval to eliminate the current 25,000 contract position and exercise limit for options on BTC and BITB. <SU>4</SU> <FTREF/> As a result, Arca would apply the position limits as determined by Arca Rule 6.8-O, Commentary .06(a)-(e) to options on BTC and BITB. Finally, Arca recently received approval to eliminate the current 25,000 contract position and exercise limit for options on GBTC. <SU>5</SU> <FTREF/> As a result, Arca would apply the position limits as determined by Arca Rule 6.8-O, Commentary .06(a)-(e) to options on GBTC. <FTNT> <SU>3</SU>   <E T="03">See</E> Securities Exchange Act Release No. 103564 (July 29, 2025), (SR-ISE-2024-62) (not yet published). </FTNT> <FTNT> <SU>4</SU>   <E T="03">See</E> Securities Exchange Act Release No. 103568 (July 29, 2025) (SR-NYSEArca-2025-10) (not yet noticed). </FTNT> <FTNT> <SU>5</SU>   <E T="03">See</E> Securities Exchange Act Release No. 103567 (July 29, 2025) (SR-NYSEArca-2025-07) (not yet noticed). </FTNT> The Exchange proposes to similarly amend its position limit rules at BX Options 9, Section 13 and exercise limits at Options 9, Section 15 to likewise eliminate the current 25,000 contract position and exercise limit for options on IBIT, BTC, BITB and GTBC. As a result, IBIT, BTC, BITB and GTBC would be subject to the position limits described in BX Options 9, Section 13 and the corresponding exercise limits in BX Options 9, Section 15. <HD SOURCE="HD3">IBIT</HD> IBIT is an Exchange-Traded Fund (“ETF”) that holds bitcoin and is listed on The Nasdaq Stock Market LLC. <SU>6</SU> <FTREF/> On September 20, 2024, ISE received approval to list options on IBIT. <SU>7</SU> <FTREF/> The current position and exercise limits for IBIT options are 25,000 contracts as stated in Options 9, Sections 13 and 15, the lowest limit available in options. <SU>8</SU> <FTREF/> <FTNT> <SU>6</SU>  Nasdaq received approval to list and trade Bitcoin-Based Commodity-Based Trust Shares in IBIT pursuant to Rule 5711(d) of Nasdaq. <E T="03">See</E> Securities Exchange Act Release No. 99306 (January 10, 2024), 89 FR 3008 (January 17, 2024) (SR-NASDAQ-2023-016) (Order Granting Accelerated Approval of Proposed Rule Changes, as Modified by Amendments Thereto, To List and Trade Bitcoin-Based Commodity-Based Trust Shares and Trust Units). IBIT started trading on January 11, 2024. </FTNT> <FTNT> <SU>7</SU>   <E T="03">See</E> Securities Exchange Act Release No. 101128 (September 20, 2024), 89 FR 78942 (September 26, 2024) (SR-ISE-2024-03) (Notice of Filing of Amendment Nos. 4 and 5 and Order Granting Accelerated Approval of a Proposed Rule Change, as Modified by Amendment Nos. 1, 4, and 5, To Permit the Listing and Trading of Options on the iShares Bitcoin Trust) (“IBIT Approval Order”). ISE began trading IBIT options on November 19, 2024. </FTNT> <FTNT> <SU>8</SU>  Options on Fidelity Wise Origin Bitcoin Fund, ARK 21Shares Bitcoin ETF, Grayscale Bitcoin Trust (BTC), Grayscale Bitcoin Mini Trust BTC, and Bitwise Bitcoin ETF are also subject to a 25,000 contract position and exercise limit. </FTNT> Per the Commission “rules regarding position and exercise limits are intended to prevent the establishment of options positions that can be used or might create incentives to manipulate or disrupt the underlying market so as to benefit the options positions.”  <SU>9</SU> <FTREF/> For this reason, the Commission requires that “position and exercise limits must be sufficient to prevent investors from disrupting the market for the underlying security by acquiring and exercising a number of options contracts disproportionate to the deliverable supply and average trading volume of the underlying security.”  <SU>10</SU> <FTREF/> Based on its review of the data and analysis provided by ISE, the Commission concluded that the 25,000 contract position limit for non-FLEX IBIT options satisfied these objectives. <SU>11</SU> <FTREF/> <FTNT> <SU>9</SU>   <E T="03">See</E> Securities Exchange Act Release No. 101128 (September 20, 2024), 89 FR 78942 at 78946 (September 26, 2025) (SR-ISE-2024-03) (Notice of Filing of Amendment Nos. 4 and 5 and Order Granting Accelerated Approval of a Proposed Rule Change, as Modified by Amendment Nos. 1, 4, and 5, To Permit the Listing and Trading of Options on the iShares Bitcoin Trust). </FTNT> <FTNT> <SU>10</SU>   <E T="03">See id.</E> </FTNT> <FTNT> <SU>11</SU>   <E T="03">See id.</E> </FTNT> While ISE proposed an aggregated 25,000 contract position limit for IBIT options in its IBIT Approval Order, it nonetheless believed that evidence existed to support a much higher position limit. Specifically, the Commission has considered and reviewed the ISE's analysis in its IBIT Approval Order that the exercisable risk associated with a position limit of 25,000 contracts represented only 0.4% of the outstanding shares of IBIT. <SU>12</SU> <FTREF/> The Commission also has considered and reviewed the ISE's statement its IBIT Approval Order that with a position limit of 25,000 contracts on the same side of the market and 611,040,00 shares of IBIT outstanding, 244 market participants would have to simultaneously exercise their positions to place IBIT under stress. <SU>13</SU> <FTREF/> Based on the Commission's review of this information and analysis, the Commission concluded that the proposed position and exercise limits of 25,000 contracts were designed to prevent investors from disrupting the market for the underlying security by acquiring and exercising a number of options contracts disproportionate to the deliverable supply and average trading volume of the underlying security, and to prevent the establishment of options positions that can be used or might create incentives to manipulate or disrupt the underlying market so as to benefit the options position. <SU>14</SU> <FTREF/> <FTNT> <SU>12</SU>   <E T="03">See id.</E> Data represents figures from August 12, 2024. </FTNT> <FTNT> <SU>13</SU>   <E T="03">See id.</E> Data represents figures from August 12, 2024. </FTNT> <FTNT> <SU>14</SU>   <E T="03">See id.</E> </FTNT> IBIT currently qualifies for a 250,000 contract position limit pursuant to the criteria in Options 9, Section 13, which requires that, for the most recent six-month period, trading volume for the underlying security be at least 100 million shares. <SU>15</SU> <FTREF/> As of November 25, 2024, the market capitalization for IBIT was $46,783,480,800  <SU>16</SU> <FTREF/> with an a ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 88k characters. 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