Ledger Holdings Inc

152 Madison Avenue, 21st Fl.

New York, NY 10016

https://ledgerx.com

May 23, 2018

VIA SEF & DCO COMMISSION PORTALS

Christopher J. Kirkpatrick

Secretary, Commodity Futures Trading Commission

Three Lafayette Centre

1155 21st Street, N.W.

Washington, D.C. 20581

Re: Commission Regulation 40.6(a) – Rule Certification 

LedgerX LLC Submission No. 18-14

Confidential Treatment Requested by LedgerX LLC as to Appendix C

Dear Mr. Kirkpatrick:

LedgerX LLC (“LedgerX”) hereby notifies the Commodity Futures Trading Commission (the 

“Commission”), pursuant to Section 5c(c) of the Commodity Exchange Act (the “CEA”) and 

Commission Regulation 40.6(a), that it is certifying the attached changes and amendments to its 

Rulebook and Operations Manual. The attached changes and amendments will become effective 

no earlier than June 7, 2018. 

A concise explanation and analysis of the changes and amendments and their compliance with 

applicable provisions of the CEA, including the Core Principles, and the Commission’s 

Regulations, is attached hereto as Appendix A. A marked copy of the changes and amendments to 

the Rulebook is designated as Appendix B. A marked copy of the changes and amendments to the

Operations Manual is designated as Appendix C. 

LedgerX certifies that the changes and amendments comply with the CEA and Commission 

Regulations thereunder. LedgerX additionally certifies that it has concurrently posted a copy of 

this submission letter and the non-confidential attachments hereto on LedgerX’s website at 

https://ledgerx.com/. LedgerX is not aware of any or substantive opposing views to the changes 

and amendments.

* * * *
Ledger Holdings Inc

Please contact the undersigned at (917) 935-6727 or alex@ledgerx.com if you have any questions 

or you would otherwise like to discuss this further.

Sincerely,

Alex C. Levine

Chief Compliance Officer & Head of Legal

LedgerX LLC
Ledger Holdings Inc

Appendix A

Rule/Section Explanations Core Principle or other CEA 

Provision, Commission Regulation 

and/or Commission Staff Letter

--Rule 5.3(A)(3), 

along with 

nomenclature 

changes at Rules 

5.5(A) and 8.4(B).

--Operations 

Manual Section 

II.A.

LedgerX is changing the termed

“Sweep, Cross, and Print" (SCP) 

order to a “Negotiated Trade” 

order. Functionally, this involves 

removing the “sweep” portion 

from such an order type. This 

change is occurring for two main 

reasons.

First, participants on the LedgerX 

platform have expressed 

confusion at the few SCP orders 

that have swept as sweeping is 

unintuitive. Participants have 

indicated that they neither expect 

nor want order sweeping, both for 

those doing such a trade and for 

those who have bids/asks on the 

central limit order book.

Second, while any delays from 

sweeping would not be noticeable 

to human traders, such time 

amounts are substantial enough 

given the speed at which market 

makers and other traders utilizing 

electronic or high-frequency 

technology move. This is mostly 

driven by cascading effects on the 

collateral side given each trade on 

the LedgerX platform has to be 

fully collateralized. For each 

fraction of an order filled as a 

sweep occurs, the availability of 

collateral needs to be checked and 

confirmed. This causes up to a 

few milliseconds of delay, making 

execution about 100 times slower. 

SEF Core Principles 2, 4, & 7.

This change enhances trading 

procedures and the financial integrity 

of transactions by bringing 

participant expectations in line with 

the mechanics and timing of a 

Negotiated Trade. A Negotiated 

Trade will still be required to be 

negotiated on the chat system within 

the LedgerX platform, which is 

monitored and reviewed. 

Essentially, participants on the 

LedgerX that execute a Negotiated 

Trade utilizing the trade matching 

system want to know with certainty 

that: (1) the trade will be executed in 

its entirety between the two entities 

entering into the trade, and (2) the 

trade will be executed as fast as 

feasibly possible given current 

technology. Removing the sweep 

part of the SCP order type 

accomplishes these two objectives 

for participants by making the 

mechanics of the trade 

straightforward and intuitive.
Ledger Holdings Inc

Appendix B

[SEE RULEBOOK REDLINE]
Ledger Holdings Inc

Appendix C

[SEE OPERATIONS MANUAL REDLINE – CONFIDENTIAL TREATMENT REQUESTED]