433 West Van Buren Street › Suite 700S › Chicago, IL 60607 › cboe.com

September 27, 2023

Christopher J. Kirkpatrick

Secretary

Commodity Futures Trading Commission

Three Lafayette Centre

1155 21st Street, N.W.

Washington, D.C. 20581

Re: Cboe Digital Exchange, LLC Rule Certification

Submission Number CDE-2023-02E

Dear Mr. Kirkpatrick:

Pursuant to Section 5c(c)(1) of the Commodity Exchange Act, as amended (“Act”), and 

Regulation 40.6(a) of the regulations promulgated by the Commodity Futures Trading Commission 

(“CFTC” or “Commission”) under the Act, Cboe Digital Exchange, LLC (“CDE” or “Exchange”) 

hereby submits the Exchange’s Futures Commission Merchant (“FCM”) Build Out Incentive 

Program (“Build Out Program” or the “Program”) and an amendment to its Rulebook in connection 

with incentive programs offered by the Exchange (“Amendment”). The Build Out Program is set 

forth in a segregated confidential Exhibit A to this submission. The Build Out Program may

become effective on or after October 12, 2023, on a date to be announced by the Exchange through 

the issuance of an Exchange notice, and the Amendment will become effective on October 12, 

2023.

Rulebook Amendments

The CDE Rulebook currently notes that the Exchange may establish programs that provide 

Participants with financial incentives for meeting trading volume or liquidity thresholds as may be 

established by the Exchange. CDE seeks to make clear that the Exchange may also establish 

programs that provide Participants with financial incentives for other additive or economically 

beneficial activity.

The Amendment, marked to show additions in underlined text and deletions in 

strikethrough text, consists of the following:

RULE 517. Liquidity Provider Incentive Programs

(a) The Exchange may from time to time establish programs that provide Participants with 

financial incentives for meeting trading volume or liquidity thresholds or for other additive

or economically beneficial activity as may be established by the Exchange.

Build Out Program

The Exchange intends to list digital asset futures on a margin basis in Q4 2023, which will 

be cleared through futures commission merchant (“FCM”) clearing members of Cboe Clear Digital, 
2

LLC (“Cboe Clear”), CDE’s affiliated derivatives clearing organization.

1 The Build Out Program 

provides a one-time incentive for FCMs to become a Clearing Member of the Exchange to connect 

to and provide access to Cboe Clear Digital, LLC (“Cboe Clear’) 2in advance of CDE’s launch of 

physically- and financially- settled margined futures contracts in late 2023. A Clearing Member of 

the Exchange is an entity that is approved for clearing membership at Cboe Clear and is authorized 

pursuant to the Cboe Clear rules to clear trades in CDE contracts, and meets CDE membership 

qualifications. In order to become a Clearing Member of the Exchange, connect to Cboe Clear, and 

provide clearing services for Exchange participants, FCMs need to incur costs and spend internal 

resources to build out their systems and complete testing required to establish the connection. The 

Program is intended to incentivize FCMs to become Clearing Members of the Exchange and offer 

clearing services through Cboe Clear Digital for margin futures contracts listed and traded on CDE 

in light of these costs and the requisite resource commitment to expend the effort to do so. 

In order to be eligible to participate in the Build Out Program, a participant must (i) meet 

the definition of an FCM under the Exchange rules; (ii) submit to the Exchange between September 

28, 2023 and October 15, 2023 a written request to participate in the Program; (iii) meet the criteria 

for becoming a Clearing Member of the Exchange pursuant to CDE Rule 902 and submit to the 

Exchange all Participant Documentation required to become a Clearing Member of the Exchange 

pursuant to CDE Rule 903; and (iv) complete required technical specifications as set forth in 

Exhibit A. The Exchange will select as Program participants the first two FCMs that submit a 

written request to the Exchange to participate in the Program, satisfy the above eligibility criteria,

and offer the most economic benefit in support of clearing physically and settled margin contracts.

The Build Out Program will commence October 12, 2023 and terminate on December 4, 

2023. The Exchange may determine to extend the term of the Program, allow the Program to expire, 

or replace or modify the Program at any time.

Core Principle Compliance

CDE believes that the Program is consistent with Designated Contract Market Core 

Principles 2 (Compliance with Rules), 9 (Execution of Transactions), and 12 (Protection of Markets 

and Market Participants) under Section 5 of the Act. CDE has made the Program available to FCMs

for legitimate business purposes in connection with its efforts to incentivize FCMs to connect to 

Cboe Clear and become Clearing Members of the Exchange to enable FCM customers to access 

Cboe Digital margin products. Such an incentive program will also enable CDE and Cboe Clear to 

expand marketability and visibility to other FCMs, which will spur interest in both the margin 

products and CDE broadly. The Program treats all parties eligible for the Program equally. CDE 

believes that the Program will contribute to the provision of a competitive, open, and efficient 

market by attracting more FCMs to provide access and clearing services to customers, which will 

encourage more customers to participate on the Exchange through FCMs, increasing overall 

participation and liquidity on the Exchange. 

CDE believes that the Amendment to the Rulebook is consistent with DCM Core Principle 19, as 

the revised rules do not result in any unreasonable restraint of trade or impose any material 

anticompetitive burden on trading on the contract market. 

Public Information

1

In early June 2023, Cboe Clear, through which all Exchange products are settled and cleared, received Commission approval of an 

amended order of registration for Cboe Clear to clear digital asset futures on a margined basis for FCMs.

2 The Exchange notes that in order to become a Clearing Member of the Exchange, a participant must become a Clearing Member of 

Cboe Clear. See CDE Rule 902(a).
3

We have concurrently posted a notice and copy of this submission on the Exchange’s 

website at https://www.cboedigital.com/regulation/exchange-notices/ under “CFTC Submissions.”

Opposing Views

We are not aware of any opposing views to this self-certification.

Certification

Cboe Digital Exchange, LLC hereby certifies to the Commodity Futures Trading 

Commission, pursuant to the procedures set forth in Commission regulation §40.6, that this 

submission complies with the Commodity Exchange Act, as amended, and the regulations 

promulgated thereunder.

If you have any questions regarding this submission, please contact the undersigned at the 

information below.

Sincerely, 

/s/ Katherine Kirkpatrick

Katherine Kirkpatrick

Chief Legal Officer

kkirkpatrick@cboe.com

(312) 786-7431