SUBMISSION COVER SHEET

IMPORTANT: Check box if Confidential Treatment is requested

Registered Entity Identifier Code (optional): 23-433

Organization: The Board of Trade of the City of Chicago, Inc. ("CBOT")

Filing as a: DCM SEF DCO SDR 

Please note - only ONE choice allowed.

Filing Date (mm/dd/yy): October 11, 2023 Filing Description: Modifications to the TBA 

Futures Market Maker Program

SPECIFY FILING TYPE 

Please note only ONE choice allowed per Submission.

Organization Rules and Rule Amendments

Certification § 40.6(a)

Approval § 40.5(a)

Notification § 40.6(d)

Advance Notice of SIDCO Rule Change § 40.10(a)

SIDCO Emergency Rule Change § 40.10(h)

Rule Numbers: Not Applicable

New Product Please note only ONE product per Submission.

Certification § 40.2(a) 

Certification Security Futures § 41.23(a)

Certification Swap Class § 40.2(d)

Approval § 40.3(a)

Approval Security Futures § 41.23(b)

Novel Derivative Product Notification § 40.12(a)

Swap Submission § 39.5

Official Product Name: 

Product Terms and Conditions (product related Rules and Rule Amendments)

Certification § 40.6(a) 

Certification Made Available to Trade Determination § 40.6(a)

Certification Security Futures § 41.24(a)

Delisting (No Open Interest) § 40.6(a) 

Approval § 40.5(a)

Approval Made Available to Trade Determination § 40.5(a)

Approval Security Futures § 41.24(c)

Approval Amendments to enumerated agricultural products § 40.4(a), § 40.5(a)

“Non-Material Agricultural Rule Change” § 40.4(b)(5)

Notification § 40.6(d)

Official Name(s) of Product(s) Affected: 

Rule Numbers: 
300 Vesey Street New York, NY 10282 T 212 299 2200 F 212 301 4645 christopher.bowen@cmegroup.com cmegroup.com

Christopher Bowen 

Managing Director and Chief Regulatory Counsel

Legal Department

October 11, 2023

VIA ELECTRONIC PORTAL

Christopher J. Kirkpatrick 

Office of the Secretariat

Commodity Futures Trading Commission

Three Lafayette Centre

1155 21st Street, N.W.

Washington, D.C. 20581

RE: Modifications to the TBA Futures Market Maker Program

CBOT Submission No. 23-433

Dear Mr. Kirkpatrick:

The Board of Trade of the City of Chicago, Inc. (“CBOT” or “Exchange”) hereby notifies the Commodity Futures 

Trading Commission (“CFTC” or “Commission”) of plans to modify the TBA Futures Market Maker Program

(“Program”). The modifications to the Program will become effective on November 1, 2023.

Exhibit 1 sets forth the terms of this Program. Modifications appear below, with additions underlined and deletions 

overstruck.

CBOT reviewed the designated contract market core principles (“Core Principles”) as set forth in the Commodity

Exchange Act (“CEA”). During the review, CBOT staff identified the following Core Principles as potentially being 

impacted: Monitoring of Trading, Execution of Transactions, Protection of Market Participants, Compliance with 

Rules, Availability of General Information, and Recordkeeping.

The Program does not impact the Exchange’s ability to perform its trade practice and market surveillance obligations 

under the CEA and the Exchange’s market regulation staff will monitor trading in the Program’s products to prevent 

manipulative trading and market abuse. Additionally, the Exchange has implemented systems to track Program 

participants’ obligations to ensure proper distribution of earned incentives. The incentives in the Program do not 

impact the Exchange’s order execution. Participants in the Program will be selected by Exchange staff using criteria 

as further stated in Exhibit 1. Chapter 4 of the CBOT rules includes prohibitions against fraudulent, non-competitive, 

unfair or abusive practices. All participants must execute a contractual agreement with the Exchange in which each 

participant will expressly agree to comply with and be subject to, applicable regulations and CBOT rules. The 

Program is subject to the Exchange’s record retention policies which comply with the CEA. 

CBOT certifies that the Program complies with the CEA and the regulations thereunder. There were no substantive 

opposing views to this Program.

The Exchange certifies that this submission has been concurrently posted on the Exchange’s website at 

http://www.cmegroup.com/market-regulation/rule-filings.html.

If you require any additional information regarding this submission, please e-mail 

CMEGSubmissionInquiry@cmegroup.com or contact Rachel Johnson at 312-466-4393 or via e-mail at 

Rachel.Johnson@cmegroup.com. Please reference our CBOT Submission No. 23-433 in any related 

correspondence.

Sincerely,

/s/ Christopher Bowen

Managing Director and Chief Regulatory Counsel 

Attachment: Exhibit 1
EXHIBIT 1

TBA Futures Market Maker Program

Program Purpose

The purpose of this Program is to encourage participants to support the launch and development of the 

products listed below. More liquid contracts on the central limit order book benefits all participants in the 

marketplace.

Product Scope

All TBA Futures (collectively, the “Products”).

Eligible Participants

The Exchange may designate up to seven (7) participants for the Program. Participants must be CBOT 

members. Prospective participants are required to submit an application/bid sheet to the Exchange as 

part of a competitive application process which is used to determine eligibility. In determining whether a 

prospective participant is selected to participate in the Program, Exchange staff may take into account a 

variety of factors including the strength of the quoting obligations the prospective participant is willing to 

commit to provide, whether Exchange staff believes that the prospective participant can maintain such 

obligations, and historical volume trading similar contracts. The Exchange may, from time to time, add or 

subtract from the aforementioned requirements as it deems necessary.

Program Term

Start date is November 7, 2022. End date is October 31, 2023 April 30, 2024.

Hours

RTH (7:00AM – 4:00PM CT).

Obligations

Minimum Quoting Obligations: In order to be eligible to receive incentives, each calendar month

participants must quote continuous two-sided markets in the Products at maximum bid/ask spreads and 

minimum quote sizes in accordance with the baseline quoting obligations set forth in the tables below. 

Participants must quote both Modules. Participants may choose to quote any instrument(s) from each 

Module. Notwithstanding the foregoing, the Exchange may vary the quoting obligations as it deems 

necessary based on ongoing evaluations of the Program.

Module 1

Product

Width 

(Minimum

Price 

Increment

“MPI”)

Width

Width

(USD

Index 

Points)

Width 

(USD)

Size

(Contracts)

Time-inMarket Time Period
Month 1 16 4/32nd 0.125 $125 30 40 40.5 47.25

hours per day, 

on average

over the 

month, across 

any number of 

instruments in 

the Module

7:00AM –

Month 2 16 4/32nd 0.125 $125 20 40 4:00PM CT

Module 2

Product Width 

(MPI) Width

Width

(USD

Index 

Points)

Width 

(USD)

Size

(Contracts)

Time-inMarket Time Period

Calendar 

Spreads 6 1.5/32nd 0.046875 $46.875 40 50 33.75 40.5hours per day, 

on average

over the 

month, across 

any number of 

instruments in 

the Module

7:00AM –

Coupon 4:00PM CT

Spreads 16 4/32nd 0.125 $125 30 40

Extreme Events Clause: If 10-Year CME Group Volatility Index (CVOL) is 170 or greater for at least three 

(3) days in a given calendar month, the Exchange may increase the bid/ask spreads by 1.5X.

If 10-Year CVOL is 230 or greater on any day in a given calendar month, the Exchange may reduce the 

time-in-market across all Modules. The time-in-market reduction is subject to a floor of 20%. 

Notwithstanding the foregoing, the Exchange may further reduce the bid/ask spreads, sizes, or time-inmarket obligations based on ongoing evaluations of market conditions and volatility. Participants will be 

given notice that the Extreme Events Clause has taken effect.

Holiday Quoting Schedule: There will be no quoting obligations on the dates listed below. The Holiday 

Quoting Schedule may be adjusted by the Exchange. Participants will be given notice of any adjustments 

to the Holiday Quoting Schedule.

Date Holiday

5/29/2023 Memorial Day

6/19/2023 Juneteenth

7/4/2023 Independence Day

9/4/2023 Labor Day

10/9/2023 Columbus Day

11/10/2023 Veterans Day

11/23/2023 Thanksgiving

11/24/2023 Post-Thanksgiving

12/25/2023 Christmas

1/1/2024 New Year’s
1/15/2024 Birthday of Dr. Martin Luther King, Jr.

2/19/2024 Presidents’ Day

3/29/2024 Good Friday

Incentives

Fee Waivers: Upon meeting the Minimum Quoting Obligations for both Modules, as determined by the 

Exchange, participants will receive fee waivers for all volume traded in the Products.

Monthly Stipend: Upon meeting the Minimum Quoting Obligations for both Modules, as determined by the

Exchange, participants will receive an equal share of a $100,000 monthly stipend, as set forth in the table 

below.

Number of 

Qualifying

Participants

Participant 

Payment

1 $100,000

2 $50,000

3 $33,333

4 $25,000

5 $20,000

6 $16,667

7 $14,286

Fee Credits: Upon meeting the Minimum Quoting Obligations for both Modules, as determined by the 

Exchange, participants will receive a fee credit of $5.00 $6.00 per side for Globex outright trades and 

$3.00 per side for Globex spread trades traded in the Products, capped at $30,000 per month, per 

participant.

Monitoring and Termination of Status

The Exchange shall retain the right to revoke participant status if it concludes from review that a 

participant no longer meets the eligibility requirements or fails to meet the obligations of the Program.

If the Exchange determines that a participant has not met its quoting obligations during one (1) calendar 

month over the course of the Program but is within twenty percent (20%) of the time-in-market 

obligations, the participant will be eligible to receive the incentives for that applicable month. 

If the Exchange determines that a participant has not met its quoting obligations during one (1) additional 

calendar month, the participant will be eligible to receive incentives for that applicable month, with the 

exception of the Monthly Stipend. Participants must meet quoting obligations for all subsequent months in 

order to continue to receive the incentives.

Upon utilizing the exceptions set forth above, participants that fail to meet quoting obligations in any 

additional month may be removed from the Program.