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

May 26, 2023

Christopher J. Kirkpatrick

Secretary

Commodity Futures Trading Commission

Three Lafayette Centre

1155 21st Street, N.W.

Washington, D.C. 20581

Re: Cboe Futures Exchange, LLC Rule Certification

Submission Number CFE-2023-010

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 Futures Exchange, LLC (“CFE” or “Exchange”) 

hereby submits a CFE rule amendment (“Amendment”) to amend the Lead Market Maker Program 

(“LMM Program”) for Cboe® iBoxx® iShares® $ High Yield Corporate Bond Index (“IBHY”) 

futures. The Amendment is set forth in a segregated confidential Appendix A to this submission. 

The Amendment will become effective on or after June 12, 2023, on a date to be announced by the 

Exchange through the issuance of an Exchange notice.

Any CFE Trading Privilege Holder (“TPH”) organization may apply to the Exchange for 

appointment as a lead market maker (“LMM”) under the amended LMM Program. Each LMM 

application, LMM appointment, and LMM under the Program is specific to a TPH and to one of 

that TPH’s Executing Firm IDs (“EFIDs”) referred to as an “LMM Program EFID”. Accordingly, 

a TPH may apply for and receive more than one LMM appointment under the Program, each of 

which is applicable to that TPH and to a different LMM Program EFID of that TPH. In that case, 

each of those LMMs is separately subject to the provisions of the Program, including the market 

performance benchmark and benefit provisions of the Program, as a single LMM.

There is no limit on the number of LMMs that the Exchange may appoint as LMMs for 

IBHY futures under the amended LMM Program. LMMs are selected by the Exchange under the 

amended LMM Program based on the Exchange’s judgment as to which applicants are most 

qualified to perform the functions of an LMM for IBHY futures based on specified criteria.

The amended LMM Program provides for market performance benchmarks that LMMs

must satisfy in order to receive specified benefits. The market performance benchmarks include

parameters with respect to minimum two-sided quote size and maximum quote width. The 

amended LMM Program includes market performance benchmarks that are applicable during 

regular trading hours for IBHY futures and market performance benchmarks that are applicable 

during a segment of extended trading hours for IBHY futures. The benefits under the amended 

LMM Program are intended to attract and retain liquidity providers in IBHY futures. Exhibit 1 to 

this submission includes the description of the amended LMM Program which CFE will include in 
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Policy and Procedure XV of the Policies and Procedures Section of the CFE Rulebook.1

 The 

Exchange believes that the market performance benchmarks and associated benefits under the 

amended LMM Program strike the appropriate balance to incentivize and retain liquidity providers 

in IBHY futures.

The amended LMM Program expires on December 31, 2023, unless the amended LMM 

Program is extended by the Exchange. CFE may determine to extend the term of the amended

LMM Program and LMM appointments under the amended LMM Program, allow the amended

LMM Program and LMM appointments under the amended LMM Program to expire, terminate the 

amended LMM Program and all LMM appointments under the amended LMM Program at any 

time, or amend or replace the amended LMM Program with a different market maker program at 

any time. Any of these actions, other than allowing the amended LMM Program to expire, would 

be done through a subsequent rule amendment submission to the Commission.

CFE believes that the Amendment is consistent with the Designated Contract Market 

(“DCM”) Core Principles under Section 5 of the Act. In particular, CFE believes that the 

Amendment is consistent with DCM Core Principles 2 (Compliance with Rules), 4 (Prevention of 

Market Disruption), 9 (Execution of Transactions), and 12 (Protection of Markets and Market 

Participants). CFE notes in this regard that: Each LMM in the amended LMM Program is obligated 

by CFE Rule 308 (Consent to Exchange Jurisdiction) to comply with Exchange rules. Each LMM

is also required under the terms of the amended LMM Program to utilize Exchange match trade 

prevention functionality under CFE Rule 406B (Match Trade Prevention) with respect to trading 

in IBHY futures through its LMM Program EFID. Exchange rules include prohibitions against 

fraudulent, non-competitive, unfair, and abusive trading practices, and the Exchange will monitor 

trading in IBHY futures for violative activity such as wash trading, manipulative trading, and 

market abuse. The Exchange believes that the amended LMM Program will have a positive impact 

on the price discovery process by fostering improved liquidity, market width and size, and trading 

volume in IBHY futures traded on CFE’s centralized market and by incentivizing market 

participants to devote their efforts to enhancing market quality in IBHY futures. Enhanced market 

quality benefits all participants in the IBHY futures market. Accordingly, CFE believes that the 

impact of the Amendment will be beneficial to the public and market participants.

CFE is not aware of any substantive opposing views to the Amendment. CFE hereby 

certifies that the Amendment complies with the Act and the regulations thereunder. CFE further 

certifies that it has posted a notice of pending certification with the Commission and a copy of this 

submission on CFE’s website (http://www.cboe.com/us/futures/regulation/rule_filings/cfe/) 

concurrent with the filing of this submission with the Commission.

Questions regarding this submission may be directed to Arthur Reinstein at (312) 786-7570

or Shane Wilkerson at (484) 798-9350. Please reference our submission number CFE-2023-010

1 See Exhibit 2 for disclaimers and trademarks with respect to IBHY futures relating to and of 

Markit Indices Limited and BlackRock Fund Advisors.
3

in any related correspondence.

Cboe Futures Exchange, LLC

/s/ Laura Fuson

By: Laura Fuson

Managing Director
4

EXHIBIT 1

(Additions are shown in underlined text and

deletions are shown in stricken text)

Cboe Futures Exchange, LLC

Policies and Procedures Section of Rulebook

* * * * *

XV. Cboe® iBoxx® iShares® $ High Yield Corporate Bond Index Futures Lead Market 

Maker Program

The Cboe® iBoxx® iShares® $ High Yield Corporate Bond Index (“IBHY”) Futures Lead 

Market Maker Program (“Program”) is applicable with respect to IBHY futures.

Trading Privilege Holder (“TPH”) organizations may apply to the Exchange for 

appointment as a lead market maker (“LMM”) under the Program. Each LMM application, LMM 

appointment, and LMM under the Program is specific to a TPH and to one of that TPH’s Executing 

Firm IDs (“EFIDs”) referred to as an “LMM Program EFID”.

Accordingly, a TPH may apply for and receive more than one LMM appointment under 

the Program, each of which is applicable to that TPH and to a different LMM Program EFID of 

that TPH. In that case, each of those LMMs is separately subject to the provisions of the Program, 

including the market performance benchmark and benefit provisions of the Program, as a single 

LMM.

There is no limit on the number of LMMs that the Exchange may appoint under the 

Program. Any TPH that desires to apply for LMM status under the Program should submit an 

application in a form and manner prescribed by the Exchange.

LMMs shall be selected by the Exchange based on the Exchange’s judgment as to which 

applicants are most qualified to perform the functions of an LMM under the Program. Factors to 

be considered in making this selection may include, but are not limited to, satisfaction of the 

qualifications listed below as well as any one or more of the factors listed in Rule 515(b), as applied 

to LMM applicants instead of with respect to DPM applicants.

The following describes the qualifications, requirements, market performance benchmarks, 

benefits, and appointment term under the Program unless otherwise specified.

Qualifications

• Ability to automatically and systematically provide two-sided markets during for IBHY 

futures trading hours.

Requirements

• Each LMM shall designate in advance to the Exchange an LMM Program EFID. An LMM 

Program EFID is a single EFID through which the LMM will provide Orders to satisfy the 

market performance benchmarks under the Program. The LMM Program EFID designated 

by an LMM must be an EFID assigned to that TPH and may not be an EFID of another 
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TPH. An LMM shall inform the Exchange in advance if the LMM determines to change 

its LMM Program EFID.

• Each LMM is required to utilize Exchange match trade prevention functionality under Rule 

406B with respect to trading in IBHY futures through its LMM Program EFID.

Market Performance Benchmarks

• Each LMM shall provide Orders in IBHY futures in conformity with specified criteria 

relating to minimum two-sided quote size and maximum quote width in order to receive 

specified benefits. These Certain of these criteria apply during IBHY futures regular

trading hours for IBHY futures and certain of these criteria apply during a specified 

segment of extended trading hours for IBHY futures.

• The Exchange may terminate, place conditions upon or otherwise limit a TPH’s 

appointment as an LMM under the Program if the TPH fails to satisfy both the market 

performance benchmarks under the Program applicable during regular trading hours for 

IBHY futures and during a specified segment of extended trading hours for IBHY futures. 

However, failure of a TPH to satisfy the market performance benchmarks under the 

Program shall not be deemed a violation of Exchange rules.

Benefits

• An LMM is eligible to receive specified benefits in connection with acting as an LMM 

under the Program.

Term

• The Program and each LMM appointment under the Program will expire on December 31, 

2023. The Exchange may determine to extend the term of the Program and LMM 

appointments under the Program, allow the Program and LMM appointments under the 

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

at any time or amend or replace the Program with a different market maker program at any 

time.

* * * * *
6

EXHIBIT 2

The iBoxx® iShares® $ High Yield Corporate Bond Index and the iBoxx® iShares® $ Investment 

Grade Corporate Bond Index (the “Indexes”) referenced herein are the property of Markit Indices 

Limited (“Index Sponsor”) and have been licensed for use in connection with Cboe® iBoxx®

iShares® $ High Yield Corporate Bond Index Futures, Options on Cboe® iBoxx® iShares® $ High 

Yield Corporate Bond Index Futures, Cboe® iBoxx® iShares® $ Investment Grade Corporate Bond 

Index Futures and Options on Cboe® iBoxx® iShares® $ Investment Grade Corporate Bond Index 

Futures. Each party to a transaction in Cboe® iBoxx® iShares® $ High Yield Corporate Bond Index 

Futures, Options on Cboe® iBoxx® iShares® $ High Yield Corporate Bond Index Futures, Cboe®

iBoxx® iShares® $ Investment Grade Corporate Bond Index Futures or Options on Cboe® iBoxx®

iShares® $ Investment Grade Corporate Bond Index Futures acknowledges and agrees that the 

transaction is not sponsored, endorsed or promoted by the Index Sponsor. The Index Sponsor 

makes no representation whatsoever, whether express or implied, and hereby expressly disclaims 

all warranties (including, without limitation, those of merchantability or fitness for a particular 

purpose or use), with respect to the Indexes or any data included therein or relating thereto, and in

particular disclaims any warranty either as to the quality, accuracy and/or completeness of the 

Indexes or any data included therein, the results obtained from the use of the Indexes and/or the 

composition of the Indexes at any particular time on any particular date or otherwise and/or the 

creditworthiness of any entity, or the likelihood of the occurrence of a credit event or similar event 

(however defined) with respect to an obligation, in the Indexes at any particular time on any 

particular date or otherwise. The Index Sponsor shall not be liable (whether in negligence or 

otherwise) to the parties or any other person for any error in the Indexes, and the Index Sponsor is 

under no obligation to advise the parties or any person of any error therein.

The Index Sponsor makes no representation whatsoever, whether express or implied, as to the 

advisability of purchasing or selling Cboe® iBoxx® iShares® $ High Yield Corporate Bond Index 

Futures, Options on Cboe® iBoxx® iShares® $ High Yield Corporate Bond Index Futures, Cboe®

iBoxx® iShares® $ Investment Grade Corporate Bond Index Futures and Options on Cboe® iBoxx®

iShares® $ Investment Grade Corporate Bond Index Futures; the ability of the Indexes to track 

relevant markets’ performances; or otherwise relating to the Indexes or any transaction or product 

with respect thereto, or of assuming any risks in connection therewith. The Index Sponsor has no 

obligation to take the needs of any party into consideration in determining, composing or 

calculating the Indexes. No party purchasing or selling Cboe® iBoxx® iShares® $ High Yield 

Corporate Bond Index Futures, Options on Cboe® iBoxx® iShares® $ High Yield Corporate Bond 

Index Futures, Cboe® iBoxx® iShares® $ Investment Grade Corporate Bond Index Futures or 

Options on Cboe® iBoxx® iShares® $ Investment Grade Corporate Bond Index Futures, nor the 

Index Sponsor, shall have any liability to any party for any act or failure to act by the Index Sponsor 

in connection with the determination, adjustment, calculation or maintenance of the Indexes. 

iBoxx® is a service mark of IHS Markit Limited. 

The iBoxx® iShares® $ High Yield Corporate Bond Index and the iBoxx® iShares® $ Investment 

Grade Corporate Bond Index (the “Indexes”), futures contracts on the Indexes and options on 

futures contracts on the Indexes (“Contracts”) are not sponsored by, or sold by BlackRock, Inc. or 

any of its affiliates (collectively, “BlackRock”). BlackRock makes no representation or warranty, 

express or implied to any person regarding the advisability of investing in securities, generally, or 

in the Contracts in particular. Nor does BlackRock make any representation or warranty as to the 

ability of the Index to track the performance of the fixed income securities market, generally, or 

the performance of HYG, LQD or any subset of fixed income securities.
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BlackRock has not calculated, composed or determined the constituents or weightings of the fixed 

income securities that comprise the Indexes (“Underlying Data”). BlackRock is not responsible 

for and has not participated in the determination of the prices and amounts of the Contracts, or the 

timing of the issuance or sale of such Contracts or in the determination or calculation of the equation 

by which the Contracts are to be converted into cash (if applicable). BlackRock has no obligation 

or liability in connection with the administration or trading of the Contracts. BlackRock does not 

guarantee the accuracy or the completeness of the Underlying Data and any data included therein 

and BlackRock shall have no liability for any errors, omissions or interruptions related thereto. 

BlackRock makes no warranty, express or implied, as to results to be obtained by Markit or its 

affiliates, the parties to the Contracts or any other person with respect to the use of the Underlying 

Data or any data included therein. BlackRock makes no express or implied warranties and expressly 

disclaims all warranties of merchantability or fitness for a particular purpose or use with respect to 

the Underlying Data or any data included therein. Without limiting any of the foregoing, in no 

event shall BlackRock have any liability for any special, punitive, direct, indirect or consequential 

damages (including lost profits) resulting from the use of the Underlying Data or any data included 

therein, even if notified of the possibility of such damages.

iShares® is a registered trade mark of BlackRock Fund Advisors and its affiliates.