SecProbe.io

CORRESP
1
filename1.htm

Tidal Trust II

234 West Florida Street, Suite 203

Milwaukee, Wisconsin 53204

April 8, 2024

VIA EDGAR TRANSMISSION

Raymond Be

U.S. Securities and Exchange Commission

Division of Investment Management

100 F Street NE

Washington, DC 20549

  Re:
  Tidal Trust II (the “Trust”)

  Post-Effective Amendment No. 160 to the Trust’s Registration Statement on Form N-1A (the “Amendment”)

  File Nos. 811-23793; 333-264478

Dear Mr. Be:

This correspondence responds to comments
the Trust received from the staff of the U.S. Securities and Exchange Commission (the “Staff” or the “Commission”)
on March 25, 2024 and April 5, 2024, with respect to the Registration Statement and the Trust’s proposed new series, the YieldMaxTM
Bitcoin Option Income Strategy ETF (the “Fund”). For your convenience, the comments have been reproduced with responses following
each comment. Capitalized terms not otherwise defined have the same meaning as in the Registration Statement.

PROSPECTUS

General

 1. Please note that the Fund’s name is subject to the Names Rule.
Please add an appropriate 80% test.

    Response: The Trust confirms that the
                              Prospectus has been revised to add the following 80% test:

                              Under normal circumstances, the Fund will
                              invest at least 80% of its net assets, plus borrowings for investment purposes, in options contracts that
                              utilize an Underlying ETP as the reference asset. For purposes of compliance with this investment policy,
                              derivative contracts will be valued at their notional value.

    An Underlying ETP is defined
                              in the Prospectus as “one or more select U.S.-listed exchange-traded products (“ETP”) that
                              seek exposure to Bitcoin, which is a “cryptocurrency.”

Principal Investment Strategies

 2. Please revise the principal investment strategy discussion to state that
although bitcoin may be referred to as a “cryptocurrency” it is not yet widely accepted as a means of payment.

    Response: The Trust confirms that the
                              foregoing statement has been added to the Prospectus’ principal investment strategy discussion.

 3. In the principal investment strategies disclosure, please describe bitcoin
and the bitcoin blockchain; the relationship of bitcoin to the bitcoin blockchain; and the use case that the bitcoin blockchain and bitcoin
have been designed to support.

    Response: The Trust confirms that such descriptions have been added
                              to the Prospectus’ principal investment strategy disclosure. Such disclosures are substantially as
                              follows:

    Bitcoin Description:

    Bitcoin, the first and most well-known cryptocurrency, operates on a
                              decentralized network using blockchain technology to facilitate secure and anonymous transactions. Bitcoin
                              represents a digital asset that functions as a medium of exchange utilizing cryptographic protocols to
                              secure transactional processes, control the creation of additional units, and verify the transfer of assets.
                              Its operation on a decentralized blockchain network ensures both transparency and immutability of records,
                              without the need for a central authority. This innovative technology underpinning Bitcoin allows for peer-to-peer
                              transactions and provides a framework for digital scarcity, making Bitcoin a unique investment commodity
                              within the digital currency landscape.

    Bitcoin Blockchain Description:

    The Bitcoin blockchain constitutes a decentralized, digital ledger technology
                              that chronologically and publicly records all Bitcoin transactions. This technology is characterized by
                              its use of blocks, which are structurally linked in a chain through cryptographic hashes. Each block contains
                              a list of transactions that, once verified and added to the blockchain through a consensus process known
                              as proof of work, becomes irreversible and tamper-evident. The integrity, transparency, and security of
                              the transactional data are maintained autonomously within the Bitcoin network, eliminating the necessity
                              for central oversight and facilitating trust in a peer-to-peer system.

    The relationship between Bitcoin and Bitcoin Blockchain:

    Bitcoin is a digital currency that operates on the Bitcoin blockchain,
                              a decentralized and cryptographic ledger system. The Bitcoin blockchain underpins the entire Bitcoin network,
                              providing a secure and transparent mechanism for recording Bitcoin transactions. Each Bitcoin transaction
                              is verified by network participants and permanently recorded on the Bitcoin blockchain, ensuring the integrity
                              and traceability of the digital currency. Thus, while Bitcoin serves as a medium of exchange or store of
                              value, the Bitcoin blockchain acts as the immutable record-keeping system that facilitates and authenticates
                              the circulation and ownership of Bitcoin. This symbiotic relationship ensures that Bitcoin operates in
                              a trustless and decentralized manner, with the Bitcoin blockchain maintaining the currency's history and
                              scarcity.

    Bitcoin and Bitcoin Blockchain Use Cases:

    Bitcoin and the Bitcoin blockchain serve as innovative financial instruments
                              within the digital economy, offering multiple use cases. Key applications include:

 1. Decentralized Transactions: Bitcoin
facilitates peer-to-peer financial transactions globally without the need for intermediaries, reducing transaction costs and times. This
feature makes it an attractive option for cross-border transfers and remittances.

 2. Store of Value: Due to its limited
supply and decentralized nature, Bitcoin is perceived as a digital alternative to traditional stores of value like gold, potentially serving
as a hedge against inflation and currency devaluation.

 3. Smart Contracts: While primarily
associated with other blockchain platforms, the Bitcoin blockchain can execute smart contracts—self-executing contractual agreements
with the terms directly written into code—thereby enabling automated and conditional transactions.

 4. Asset Tokenization: The Bitcoin blockchain
provides a platform for tokenizing assets, converting rights to an asset into a digital token on the blockchain. This can include real
estate, stocks, or other forms of assets, enhancing liquidity and market efficiency.

 5. Digital Identity Verification: Leveraging
the security and immutability of the Bitcoin blockchain, companies can develop digital identity verification systems, enhancing privacy
and reducing identity theft.

    Top of Form

 4. Please revise the discussion of the Fund’s principal investment
strategies and associated principal risks to discuss the activities of the Underlying ETF. Also disclose the following: (i) a statement
that the Underlying ETF’s prospectus, periodic reports and other information filed with the SEC pursuant to the federal securities
laws are available in the EDGAR database on the SEC’s website at www.sec.gov; and (ii) the name of the national securities exchange
on which the underlying ETF is listed and the associated ticker symbol.

    Response: The Trust confirms that the requested additional disclosure
                              has been added to the Prospectus due to the fact that, as of the date of the prospectus, options contracts
                              are available only one ETP, which is an exchange traded fund. The Trust intends to remove such disclosure
                              at such time options contracts become available for more than one Bitcoin ETP.

 5. The Staff notes that it appears that the following statement is incorrect.
“No Underlying ETP is expected to be registered as an investment company.” Please revise as appropriate.

    Response: The Trust confirms that the foregoing statement has been removed
                              from the Prospectus.

 6. It is the Staff’s understanding that covered call strategies are
suited to stable markets in which volatility is low. With a view to improved strategy and risk disclosure, please explain the logic behind
using bitcoin-based ETPs as the reference asset for the strategy, given bitcoin’s historical volatility. In this regard, please
more clearly explain the link between income and volatility as well as the implications to the Fund and its total returns associated with
such volatility.

    Response: Tidal Investments LLC (the “Adviser”) respectfully
                              holds a differing perspective on the aforementioned assertion. Covered call strategies serve various purposes,
                              but they are commonly used to generate income on a position where an investor (here, the Fund) holds a
                              moderately bullish outlook. Notably, the degree of volatility predominantly influences the generated income.
                              Consequently, a reference asset characterized by low volatility will yield a commensurately low level of
                              income, whereas a highly volatile reference asset will generate a higher income stream. The rationale behind
                              introducing the Fund with such a strategy stems from the varying preferences among investors. While some
                              investors may prefer a direct purchase of the Underlying ETP to adopt a long-only perspective on Bitcoin's
                              price, other investors may seek to capitalize on Bitcoin's volatility by seeking to obtain yield through
                              options trading. This Fund’s strategy seeks to provide such potential benefits through an actively
                              managed investment approach.

    In terms of the Fund’s total
return potential, the Fund will generally perform best during periods when the price of Bitcoin rises slowly. The Fund will also generally
outperform the price of Bitcoin during periods when Bitcoin prices decline or have flat performance. The Fund will generally underperform
Bitcoin during periods when Bitcoin experiences significant price appreciation. However, it is worth noting that any derivative structure
such as that employed by the Fund is path dependent, meaning that the Fund’s return is contingent on the path of the underlying
asset's price movement over various points of time.

 7. Please clarify the second bullet pointed paragraph on the top of page
4.

    Response: The Trust confirms that the foregoing paragraph has been clarified.

 8. With respect to the discussion of covered call writing, please clarify
the price scenarios in which the Fund may gain or lose money based on a particular position. Consider breaking out the Item 9 disclosure
to provide more clarity with respect to each scenario.

    Response: The Trust has added a table to clarify the price scenarios
                              in which the Fund may gain or lose money based on a particular position.

 9. Discuss how the Fund will select which Underlying ETPs on which to trade
options.

    Response: The Trust confirms that the Prospectus has been supplemented
                              with a description of how the Fund’s investment sub-adviser selects Underlying ETPs on which to trade
                              options.

Principal Investment Risks

 10. Bitcoin Investment Risk.

 a. Please disclose that the value of bitcoin has been, and continues to
be, substantially dependent on speculation, such that trading and investing in bitcoin generally may not be based on fundamental analysis.

 b. Please discuss the exposure of bitcoin to instability in other speculative
parts of the crypto/blockchain, such that an event that is not necessarily related to the security or utility of the bitcoin blockchain
can nonetheless precipitate a significant decline in the price of bitcoin.

 c. Please also disclose the risks related to fragmentation and lack of regulatory
compliance with regard to crypto asset trading platforms. Also, disclose that crypto asset trading platforms on which bitcoin is traded,
and which may serve as a pricing source for the valuation of the bitcoin-linked derivatives held by the underlying ETF, are or may become
subject to enforcement actions by regulatory authorities.

 d. Please clarify that the bitcoin blockchain may be vulnerable to attacks
to the extent that there is a “miner” or group of miners that possess(es) more than 50% of the blockchain’s hashing
power. Briefly discuss what hashing power is.

 e. Please clarify that proposed changes may not be adopted by a sufficient
number of users and miners, which may result in competing blockchains with different native crypto assets and sets of participants (also
known as a fork) and give examples of forks.

 f. Please disclose that the bitcoin blockchain’s protocol may contain
flaws that can be exploited by attackers.

 g. With regard to the bitcoin blockchain, please disclose the risks or challenges
posed by the emergence of other public blockchains that are similarly designed to serve as an alternative payment system, such as those
focused on privacy through the use of zero-knowledge cryptography.

 h. Please also explain the common impediments and/or disadvantages to adopting
the bitcoin blockchain as a payment network, including the slowness of transaction processing and finality, variability of transaction
fees, and volatility of bitcoin’s price.

 i. Please explain that further development and use of the blockchain for
its intended purposes are, and may continue to be, substantially dependent on Layer II solutions; briefly describe Layer II networks and
any risks or challenges that they pose to the blockchain and bitcoin. In this regard, you should note the risks related to transactions,
other than opening and closing transactions, being executed off the blockchain.

 j. Please also disclose the risks and challenges related to the adoption
and use of other blockchains that support more advanced applications and use cases than the bitcoin blockchain, such as those blockchains
that are specifically designed to support the development, deployment, and operation of smart contracts.

 k. Please do not refer to the markets on which bitcoin and other crypto
assets traded as “exchanges.” Please refer to them as crypto asset trading platforms or other similar term that does not suggest
that they are “exchanges” registered as, for example, national securities exchanges under Section 6 of the Securities and
Exchange Act.

    Response: The Trust confirms that the Fund’s Underlying ETP Risk
                              - Bitcoin Investment Risk has been revised to address each of the foregoing risks.

 11. We note that this Fund will not be the first of its kind. Consider discussing
in the risk factor section, that the Fund does not necessarily have a new investment objective and strategy.

    Response: The Trust respectfully declines to add such disclosure. The
                              fact that the Fund’s strategy is not completely unique is not, in the Trust’s view, a principal
                              investment risk. In addition, the Trust notes that Prospectus includes disclosure that states that “There