23-004

March 1, 2023

VIA PORTAL

Commodity Futures Trading Commission

Attention: Christopher Kirkpatrick, Secretary

Three Lafayette Centre

1155 21st Street, NW

Washington, DC 20581

Re: CFTC Regulation 40.6(a) Certification: Submission of Amendments to the 

Nodal Exchange Rulebook

Dear Mr. Kirkpatrick:

Nodal Exchange, LLC (“Nodal Exchange” or “Exchange”) is notifying the Commodity Futures 

Trading Commission (“CFTC” or “Commission”) that it is self-certifying amendments to the 

Nodal Exchange Rulebook (“Rules”) pursuant to Commission Regulation 40.6(a). The

Exchange is amending Rule 4.10.4 Options Exercise (Physical Settlement) and Appendix A 

Contract Specifications regarding power calendar options. The amended Rules are attached 

hereto and indicate the specific text in red that is being amended. The Exchange intends to 

implement the amended Rules on or after March 15, 2023.

Nodal Exchange is updating Rule 4.10.4 to specify that the exercise of “in-the-money” 

options is automatic on the last trading day for calendar year power options. In addition, 

the Exchange is amending the published time for daily settlement prices for options’ 

underlying futures contracts to 3:00 pm EPT for power options (absent operational delays 

by the Exchange). The Contract Specifications for calendar year power options are being 

amended to align with the Rulebook. Specifically, the Contract Specifications state that 

exercise of options is automatic and manual exercise or abandon is not permitted for 

calendar year power options. The amendments are in response to feedback from market 

participants. There is no open interest on the amended contracts.

Exchange management has assessed the amendments to the Rules and their compliance 

with applicable provisions of the Act, including the Commissions Regulations and the Core 

Principles. Nodal Exchange has identified that the amendments may affect the following 

Core Principles as follows:

Core Principle 2 - Compliance with the Rules: The amendments to the Rules provide clarity 

and consistency with the Act for compliance with the Rules. The Exchange Rulebook is

applicable to all Nodal Exchange Participants.
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Core Principle 4 - Prevention of Market Disruption: All activity performed on Nodal is subject 

to the Nodal Exchange Rulebook Section VI, which prohibits disruptive trading behavior and 

manipulation, subject to monitoring and surveillance by the Exchange’s Division of Market 

Surveillance.

Core Principle 7 – Availability of General Information: The amendments to the Rules

provide clarity to Exchange Participants. The amended Rules are available to market 

authorities, Participants, Authorized Brokers and the public on the Exchange website.

Core Principle 12 - Protection of Markets and Market Participants: Section VI of the Nodal 

Exchange Rulebook protects the market and market participants from abusive, disruptive, 

fraudulent, noncompetitive and unfair conduct and trade practices. 

Core Principle 13 - Disciplinary Procedures: Section VII of the Nodal Exchange Rulebook 

describes the disciplinary procedures of the Exchange that authorize the Exchange to 

discipline, suspend, or expel anyone on the Exchange that violates these rules. 

Pursuant to Section 5c(c) of the Act and the Commission’s Regulation 40.6, the Exchange 

certifies that amended Rules comply with the Act and the Commission’s Regulations 

thereunder. There have not been any opposing views expressed regarding the amendments 

to the Rules.

Nodal Exchange certifies that this submission has been concurrently posted on the Nodal 

Exchange website at www.nodalexchange.com.

If you have any question or need additional information regarding this submission, please 

contact me at 703-962-9853 or Markotic@nodalexchange.com.

Sincerely,

/s/ Max Markotic

Senior Director Compliance

Attachment:

Redline of Nodal Exchange Rulebook 4.10.4

Redline of Appendix A – Contract Specifications