17 State Street › New York, NY 10004 › cboe.com

December 1, 2022

Submitted via CFTC Portal

Office of the Secretariat 

U.S. Commodity Futures Trading Commission

Three Lafayette Centre

1155 21st Street

Washington, DC 20581

Re: Submission of Cboe SEF, LLC Rule Amendment (Submission No. 22-13) 

Dear All:

Pursuant to Section 5c(c) of the Commodity Exchange Act (CEA) and Section 40.6(a) of the 

regulations of the Commodity Futures Trading Commission (Commission), Cboe SEF, LLC (Cboe

SEF) hereby notifies the Commission of Cboe SEF’s implementation of a market maker program 

(Program) pursuant to Cboe SEF Rule 318. The Program will become effective on January 1,

2023. 

Cboe SEF Rule 318 (Market Maker Program) provides that to provide liquidity and help to 

maintain a fair and orderly market, from time to time the SEF may establish one or more market 

maker programs in such Products and for such periods of time that it deems appropriate. The SEF 

will notify Participants of its market maker programs by posting a Notice to Participants on the 

SEF’s website, which will provide information concerning the market maker program. 

The Program is set forth in the attached Exhibit A. 

Cboe SEF believes that the Program is consistent with SEF Core Principle 2 (Compliance with Rules) 

under Section 5h of the CEA and Commission Regulation 37.202 in that the Program will be 

applied in an impartial, fair, and non-discriminatory manner and the Program will be made 

transparent to all Participants. In addition, the Program complies with Core Principle 2 and

Commission Regulation 37.200 because it does not incentivize manipulative trading or market 

abuse or impact Cboe SEF’s ability to perform its trade practice and market surveillance 

obligations under the Act and Cboe SEF Regulation staff will continue to monitor trading to 

prevent manipulative trading and market abuse. The Program also complies with the 

requirements for monitoring and trade processing in Core Principle 4 and Commission Regulation 

37.401, and the recordkeeping and reporting requirements in Core Principle 10 and Commission 

Regulations 37.1000 and 37.1001.
U.S. Commodity Futures Trading Commission

December 1, 2022

Page 2

17 State Street › New York, NY 10004 › cboe.com

Cboe SEF certifies that the Program complies with the CEA and the Commission’s regulations. 

Cboe SEF further certifies that this submission has been concurrently posted on its website at 

http://markets.cboe.com/global/fx/sef/resources/. No substantive opposing views were 

expressed with respect to the Rule Amendment. 

If you have any questions regarding this submission, please contact me at (312) 786-7153 or 

mmargolis@cboe.com. 

Sincerely, 

/s/ Michael H. Margolis 

Michael H. Margolis

Assistant General Counsel

Cboe SEF, LLC

Attachment 
Cboe SEF, LLC

Submission No. 22-13

B-1

EXHIBIT A

Market Maker Program
17 State Street › New York, NY 10004 › cboe.com

Notice No. 22-15

Date: December 1, 2022

Subject: Cboe SEF Market Maker Program 

Cboe SEF, LLC (Cboe SEF) intends to launch an NDF Market Maker Program effective January 1, 2023. 

Pursuant to Cboe SEF Rule 318, Cboe SEF has established these Market Maker Standards to describe 

certain general parameters associated with the designation by Cboe SEF of certain Participants of the 

Platform(s) as Market Makers (MMs) in respect of NDF Transactions. 

Capitalized terms used in these MM Standards that are not defined herein shall be as defined in the Cboe 

SEF Rulebook. Average Daily Volumes (ADVs) noted within these MM Standards are expressed in USD 

notional amounts, and ADVs are determined on a monthly basis with reference to trading activity in 

respect of the previous calendar month.

Products and Eligibility 

The Cboe SEF MM Program (Program) is applicable with respect to NDF Transactions. 

Any Cboe SEF Participant may request the MM designation. There is no limit on the number of 

Participants that the SEF may approve under the Program. Participants shall be selected by Cboe SEF as 

MMs under the MM Standards based on Cboe SEF’s judgment as to which applicants are most qualified 

to perform the functions of an MM based on the criteria set forth below.

Unless they notify the SEF to the contrary by January 1, 2023, those Participants that have been previously 

designated as MMs pursuant to SEF Rule 318(2) shall be deemed to have requested the MM designation 

under the Program. 

Terms

The Program and each MM appointment under the Program will expire on December 31, 2023. The SEF 

may determine to extend the term of the Program and MM appointments under the Program, allow the 

Program and MM appointments under the Program to expire, terminate the Program and all MM 

appointments under the Program at any time or amend or replace the Program with a different market 

maker program at any time 

Qualifications 

Ability to automatically and systematically provide two-sided markets in NDF Transactions during SEF 

trading hours. 

Ongoing MM Criteria

Unless otherwise provided below, the MM Criteria set forth in these MM Standards will take into account 

such Participant’s activity in respect of NDF Transactions executed on Cboe SEF’s Sweepable Platform 

only, Full Amount Platform only, or on both the Sweepable and Full Amount Platforms combined – each 

Platform as more fully described in Cboe SEF Rule 506(2). To retain its MM designation, a Participant must 

meet each applicable MM Criterion each calendar month. At the beginning of each calendar month Cboe 
2

SEF will send to each MM an “MM Scorecard” listing any failure to meet any of the MM Criteria during 

the previous calendar month. 

A failure to meet one or more MM Criteria in each month may result in a warning. Failing to meet the 

same or different MM Criterion(a) over a period of consecutive months may result in suspension or 

removal of MM status in Cboe SEF’s sole discretion. If a Participant loses its MM designation, such 

Participant may request consideration as a MM by re-applying for the MM designation.

MM Criteria

Criterion Platform Requirement

Passive ADV*

Sweepable N/A

Full Amount 

(FA) N/A

Order Acceptance Rates 

(“OAR”)**

Sweepable Minimum 75% (aggregate average across all 

feeds)

FA Minimum 90% (aggregate average across all 

feeds)

Order Review Time Frame 

(“ORT”)** All Maximum 35ms

Quote Duration All Maximum 10% quotes <=5ms

Quote Size

Sweepable 

(Non-Firm) Minimum quote Notional Amount of 1M units

Sweepable

(Firm)

Minimum quote Notional Amount of 500k 

units

FA Quote sizes as prescribed within Cboe SEF 

order entry specifications

* “Passive” ADV means the ADV in respect of NDF Transactions entered into based on executable prices 

provided to the Platform by a Participant, which prices are subsequently aggressed upon by another 

Participant. Cboe SEF shall determine in its sole discretion whether a Participant is acting in a Passive 

capacity in respect of any NDF Transaction.

** Only applicable to MMs providing non-firm liquidity to the relevant Platform(s).

Benefits

Such designation may, in Cboe SEF’s sole discretion, entitle a MM to provide firm and/or non-firm liquidity 

to the Platform(s) and receive certain post-trade data from Cboe SEF.

Additional Information

If you have any questions regarding this Notice to Participants, please contact the FX Trade Desk at 

fxtradedesk@cboe.com.