April 23, 2022
This rule will allow the creation of synthetics of synthetics. These ETFs would not hold the real shares and create their own liquidity. It amounts to theft. This would be the lending of a synthetic. In other words print your own money. How is this even being proffered, the contemplation of fake shares to be used to prevent the paying of value to shareholders is robbery. The SECs role is to PROTECT RETAIL. This would allow SFTs to provide liquidity to the market, facilitating the ability of market participants to meet delivery on short sales, thereby avoiding Failures to deliver, Naked Shorts and the like. This would be a loophole to hide FTDs and NAKED SHORTS or similiar instruments. The verbage is very deceptive, while it appears to help the market, its purpose would be only to help Hedge Funds and injure investors. Please do not allow this rule to move forward.