October 30, 2023

Via CFTC Portal Submissions

Mr. Christopher Kirkpatrick

Secretary of the Commission

Office of the Secretar

Commodity Futures Trading Commission

3 Lafayette Centre

1155 21

st Street, N.W.

Washington D.C. 20581

RE: Self-Certification of Product: Litecoin (LTC) Cryptocurrency Event Contract

Submission Pursuant to Commission Regulation §40.2(a)

Dear Mr. Kirkpatrick:

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

§40.2(a) of the regulations promulgated by the Commodity Futures Trading Commission (the

“Commission”) under the Act, North American Derivatives Exchange, Inc. d/b/a Crypto.com |

Derivatives North America (the “Exchange” or “CDNA”) hereby self-certifies a swap, which is 

event contract on Litecoin (LTC) cryptocurrency (the “LTC Crypto Event Contract”), which will be

set forth in the Exchange Rules and will be launched by the Exchange on or after November 1,

2023.

The Exchange has self-certified multiple cryptocurrency contracts in the past, including Tou

Bracket Contracts on Bitcoin (BTC) and Ether (ETH) on October 28, 2022, Touch Bracket

Contracts on Litecoin (LTC) and Dogecoin (DOGE) on June 21, 2023, Touch Bracket Contracts on

Bitcoin Cash (BCH) on September 26, 2023, and BTC and ETH Event Contracts on April 10, 2023.

In addition, the Exchange has listed both Event Contracts and Call Spread Contracts based on

the Underlying bitcoin market at various times since 2014.

1 Since launching the BTC, ETH, LTC

and BCH Touch Bracket Contracts in 2023, combined trading volumes of these contracts totals

over 740,000 contracts. Therefore, the Exchange continues to expand its cryptocurrency

commodity derivative product offerings to meet public demand for diverse and regulated

products.

2

The LTC Crypto Event Contract set forth in Rule 12.98 is nearly identical in nature to the Bitcoin

Event Contract that was self-certified by the Exchange on April 10, 2023, and the Ether Eve

Contract that was also self-certified by the Exchange on April 10, 2023. The LTC Crypto Eve

Contract includes Intraday, Hourly and Daily Cryptocurrency contracts on the cryptocurrency

Litecoin and will be structured in the same way as the Exchange’s currently listed event

2 We use the terms “cryptocurrency” and “digital asset” interchangeably in this filin

1 Unless otherwise defined herein, capitalized terms shall have the same definition as set forth in Rule 1.1 of

Exchange Rulebook.

Crypto.com | Derivatives North America

200 West Jackson Blvd., Suite 1400

Chicago, IL 60606
contracts for Forex.

3 Nine strike levels will be generated for the LTC Crypto Event Contract. The

Expiration Value for the LTC Crypto Event Contract will be the Index Value as specified in ea

Contracts’ individual specifications. Like all the Exchange Event contracts, the LTC Crypto Eve

Contract will have a settlement payout range from $10 to $100, or a $0 payout. The LTC Crypto

Event Contract will be listed at 8:00AM ET on the Start Date, or at the Expiration of the previously

listed Event Contract (as described in the Specifications) and will cease trading pursuant 

each Contracts’ individual specifications. The Exchange has at least three dedicated mark

makers who are committed to providing liquidity for the LTC Crypto Event Contract.

The Indicative Index for the LTC Crypto Event Contract will be determined by using the

Exchange’s standard Indicative Index calculation method (the “the Exchange Calculation

Method”).

4 The Exchange will calculate and produce an Index Value for each cryptocurrency

once each second throughout the life of the LTC Crypto Event Contracts. That is, each second

the Exchange will calculate an Index Value for the respective cryptocurrency by taking all

bids/ask midpoint prices in the relevant Underlying markets, as reported in the ICE

® Crypto Data

and the Lukka, Inc. Data Feed (as further described below), in the sixty (60) seconds leading up

to the Calculation Time, provided at least twenty-five (25) bids/ask midpoint prices are captur

during the sixty (60) second period, removing the highest twenty (20) percent of Underlying

bids/ask midpoint prices and the lowest twenty (20) percent of Underlying bids/ask midpoint

prices from the data set

5

, and using the remaining Underlying bids/ask midpoint prices to

calculate the relevant cryptocurrency Index Value for that second. The calculation used is a

simple average of the remaining Underlying bids/ask midpoint prices in the data set, rounded to

5

If 20% of the data set would result in a non-integer number of bid/ask midpoint prices, the number of bid/ask

midpoint prices to be removed from the set will be rounded down. For example, if the number of bid/ask midpoint

prices collected during the last 10 seconds prior to the close of trading was 31, 20% of the data set would be 6.2

bid/ask midpoint prices. As 6.2 is a non-integer number, the value will be rounded down, and the 6 highest and 6

lowest bid/ask midpoint prices will be removed from the data set.

4 All Touch Bracket Contracts listed and cleared by the Exchange make use of the Indicative Index to determine the

Expiration Value of the contract. Specifically, these include the BTC, ETH, EUR/USD, GBP/USD, USD/CHF, USD/JP

AUD/USD, USD/CAD, EUR/GBP, AUD/JPY, GBP/JPY, EUR/JPY, Wall Street 30, US 500, US Tech 100, US SmallCap 2000,

Gold, Silver, Crude Oil, and Natural Gas Touch Bracket Contracts.

3 Concurrent with Bitcoin and Ether, Litecoin has been expressly identified by the Commission as a “commodity” 

various filings. See, e.g., CFTC v. Changpeng Zhao, Binance Holdings Limited, Binance Holdings (IE) Limited, Binan

(Services) Holdings Limited, and Samuel Lim (filed Mar. 27, 2023) (N.D. Ill.) at ¶ 24 (stating “Certain digital asset

including BTC, ETH, LTC [emph. added], and at least two fiat-backed stablecoins, tether (‘USDT’) and the Binance U

(‘BUSD’), as well as other virtual currencies as alleged herein, are ‘commodities,’ as defined under Section 1a(9) of t

Act, 7 U.S.C. § 1a(9)”). See Also, In re Tether Holdings Ltd., et al., CFTC Docket No. 22-04 (Oct. 15, 2021) (stating

“Digital assets such as bitcoin, ether, litecoin [emph. added], and tether tokens are commodities.”) and CFTC v HDR

Global Trading Ltd., et al. (d/b/a BitMEX), 20-cv-8132, (filed October 01, 2020) (S.D.N.Y) at ¶ 23 (stating “Bitcoin, ethe

Litecoin [emph. added], and other virtual currencies are distinct from ‘real’ or ‘fiat’ currencies, which are the coin a

paper money of the United States or another country that are designated as legal tender, circulate, and are

customarily used and accepted as a medium of exchange in the country of issuance. Digital assets, such as bitcoin,

ether, and litecoin are ‘commodities’ as defined under Section 1a(9) of the Act, 7 U.S.C. § 1a(9) (2018)”) (emp

added). Additionally, LTC was created by a fork from BTC, therefore, LTC is tethered to, and maintains the

characteristics of BTC, which the CFTC has identified as a “commodity,” as noted above. LTC has been in existen

for over a decade, is decentralized and operates as a digital asset or virtual currency because, among other reasons,

(1) it is used as a transfer of value and (2) because it is used for payments. Indeed, the digital asset in this filing 

captured under the authority of the CFTC, as well as the broad definition of commodity in Section 1a(9) of the Ac

Moreover, LTC has no history of being categorized as anything other than a commodity and no federal law or federal

regulatory authority in the United States has indicated anything to the contrary.

Crypto.com | Derivatives North America

200 West Jackson Blvd., Suite 1400

Chicago, IL 60606

2
one decimal point past the precision of the Underlying market. In the event the time it takes to

collect at least twenty-five (25) Underlying bids/ask midpoint prices exceeds the sixty (6

second period, the Index Value will be calculated by taking the last twenty-five (25) Underlyi

bids/ask midpoint prices just prior to the Calculation Time, removing the highest five (

Underlying bids/ask midpoint prices and the lowest five (5) Underlying bids/ask midpoint price

and using the remaining fifteen (15) Underlying bids/ask midpoint prices to calculate t

relevant Index Value. The calculation used is a simple average of all fifteen (15) Underlyi

bids/ask midpoint prices, rounded to one decimal point past the precision of the Underlying

market. The Exchange uses this calculation method as a means of preventing manipulation in

the Underlying market to influence the Exchange Expiration Valu

The Exchange plans to list the LTC Crypto Contracts based on the Underlying LTC

cryptocurrency commodity market and settle the LTC Crypto Contracts using data from the “ICE

Cryptocurrency Data” feed (“ICE Crypto Data”'), distributed by ICE Data

® Connectivity and Feeds,

Inc. (“IDCF”), as well as data from Lukka Inc. (the Lukka Data Feed (“LDF”)).

IDCF is part of the Intercontinental Exchange group of entities. In 2018 IDCF partnered with

Blockstream Corporation, Inc., a leading provider of blockchain technologies, distributed

systems, and crypto-financial infrastructure, to launch the ICE Crypto Data. The ICE Crypto Da

is an aggregation of comprehensive multi-asset data from the most widely and actively traded

cryptocurrencies from leading trading venues, markets, and exchanges, compiled by

Blockstream and distributed by IDCF. The ICE Crypto Data currently includes data from

thirty-one (31) trading venues, with nine (9) venues contributing data pertaining to LTC

cryptocurrency commodity.

The LDF is maintained by Lukka, Inc., using the principles set forth in the IOSCO Principles for

Financial Benchmarking (the “IOSCO Principles”). The LDF is disseminated to major market

data vendors on a one-second frequency. Lukka was founded in 2014 and is a global company

headquartered in the U.S. that provides institutional data to traditional and cryptocurrency

exchanges and trading desks, CPA and accounting firms, fund and financial auditors, 

administrators, miners, protocols, individuals, and any other businesses interacting with

cryptocurrencies. The constituent Exchange venues for the LDF maintain fair and transparent

market conditions to impede illegal, unfair or manipulative trading practices, not place undue

barriers to entry and comply with applicable law and regulation including, capital markets

regulations, money transmission regulations, and client money custody requirements.

Additionally, Lukka ensures that constituent exchange venues deliver transparent and consistent

trade data via an API with sufficient reliability, detail, and timeliness. Moreover, the constitu

exchange venues must agree to cooperate with inquiries and investigations of the administrator

and execute data sharing agreements with the Exchange.

The Exchange can customize the data it receives from the ICE Crypto Data feed, as well as the

LDF, by selecting any number of the contributing venues. Of the contributing venues, the

Exchange has selected specific venues from which IDCF and LDF will provide data to be used 

Crypto.com | Derivatives North America

200 West Jackson Blvd., Suite 1400

Chicago, IL 60606

3
the calculation of the Indicative Index for the LTC Crypto Contract (the “Underlying Trading

Venues”), and ultimately the LTC Crypto Contracts’ Expiration Value.

The Exchange made its selection of venues based on several factors, including CoinGecko’s

Trust Score rating, the Underlying Trading Venues’ daily spot volume ranking, AML and KYC

policies implementation, regulatory requirements, and the venue’s location in order to provide

global coverage.

6 The Exchange will monitor CoinGecko’s Trust Score ratings and may add to or

remove venues from its data consumption based on these scores. CoinGecko’s rating of the

venues the Exchange has selected are located here. The ICE Crypto Data and the LDF include a

number of data points to aid in the monitoring of the relevant crypto markets such as price

discovery, historic data and full-depth market by price and venue, and a 24-hour market

overview. The Exchange will periodically review the Underlying Trading Venues it has selected

to determine the venues’ continued appropriateness for inclusion in the Indicative Index and

may add or remove trading venues as appropriate.

The LTC Crypto Event Contract benefits the public interest both as a hedging tool and a tradi

instrument where market participants can take a market view on the price of the given

commodity. Like all the Exchange Contracts, the LTC Crypto Event Contract will be fully

collateralized at the time the transaction is entered. Thus, the trader is aware of the maximum

risk to enter the transaction and the risk is limited by virtue of the pre-determined Strike Levels.

The Underlying Litecoin market is traded 24 hours per day, 7 days per week. The Exchange has

selected the specific Underlying Trading Venues from which to obtain prices to include in t

calculation of the Indicative Index Value that operate from different regions globally, in order to

mitigate against the possibility of less activity in the Underlying markets at any given time due to

the time of day. As noted above, the Exchange will have at least three dedicated Market Makers

who will quote a two-sided market pursuant to the terms of the Market Maker Agreement and

subject to the rules of the Exchange. Non-Market Maker Trading Members will have a Position

Limit of 2,500 Contracts. In order to provide sufficient liquidity, Market Makers will be subject

Alternative Position Limits two times the standard 2,500 lot position limit, but which shall apply

on a per strike basis rather to the entire Class of Contracts. Market Makers will also be relieved

of their quoting obligations once they have acquired a position of 500 Contracts, but will be

required to resume their obligations once their position has fallen below 500 Contracts.

Trading in the LTC Crypto Event Contract will begin at 11:00 pm ET Friday evening, and expire as

indicated in the Specificatio

6 CoinGecko has been in operation since 2014 and is a website and mobile app that provides live crypto prices, crypto

education, and aggregates information regarding the performance of various cryptocurrencies for analysis purposes.

CoinGecko launched its Trust Score rating in May 2019 in order to combat fake trading volume among cryptocurrency

exchanges. In determining a rating, CoinGecko considers the crypto exchange’s liquidity/web traffic quality, scale

operations, API technical coverage, cybersecurity, team presence (transparency into management team), and past

negative incidents (such as regulatory issues, hack incidents, account disputes, etc.). Further explanation as to

CoinGecko’s Trust Score rating methodology can be found here. CoinGecko indicates that it is constantly revising,

improving and upgrading factors for consideration in its ratings determination, and plans to include trade history

analysis, API quality analysis, hot and cold wallet analysis, social media analysis, exchange support turnover time,

user reviews, and licensing and regulations analysis in the future.

Crypto.com | Derivatives North America

200 West Jackson Blvd., Suite 1400

Chicago, IL 60606

4
DCM Core Principles

The Exchange has identified the following Designated Contract Market (“DCM”) Core Principl

as potentially being impacted by the launch of the LTC Crypto Event Contract: Core Principle 2

(Compliance with Rules), Core Principle 3 (Contracts Not Readily Subject to Manipulation), Core

Principle 4 (Prevention of Market Disruption), Core Principle 7 (Availability of General

Information), Core Principle 8 (Daily Publication of Trading Information), and Core Principle 18

(Recordkeeping).

Core Principle 2 Compliance with Rules

Core Principle 2 requires the DCM to have the capacity to detect, investigate, and apply

appropriate sanctions to any person that violates any rule of the contract market. The Exchange

has a dedicated Compliance/Regulatory staff that monitors the markets, investigates potential

rule violations, and imposes sanctions against individuals who have been determined to have

violated the Rules. The Exchange has an automated trade surveillance system, Scila, which is

capable of detecting potential trade practice violations, and also conducts real-time market

monitoring of all trading activity in all Contracts, at all hours the Exchange is open. The

Exchange is able to set the parameters by which the system detects potential issues. Chapter 9

of the Exchange Rulebook sets forth the Exchange’s authority to investigate and sanction

Members for activity that violates the Exchange Rules. Exchange Rule 2.10 grants the Exchange

jurisdiction over any Person initiating or executing a transaction on or subject to the Rules of the

Exchange, either directly or through an intermediary, and any Person for whose benefit su

transaction has been initiated or executed. The Exchange’s jurisdiction continues

notwithstanding the termination of the Person’s Exchange Membership. Exchange Rule 3.3

requires all Trading Members and Authorized Traders to comply with the Exchange Rules and to

cooperate with the Exchange promptly and fully in any investigation, call for information, inquiry,

audit, examination or proceeding. Such cooperation may involve a request for the Member’s or

Authorized Trader’s activity in the relevant Underlying market. Accordingly, the listing of the New

Event Contracts will not negatively impact the Exchange’s ability to comply with this Core

Principle.

In addition, the Exchange is a member of the Intermarket Surveillance Group (“ISG”). The ISG is

an international group of exchanges, market centers, and market regulators that perform market

surveillance in their respective jurisdictions. The ISG provides a framework for the sharing of

information and the coordination of regulatory efforts among exchanges trading securities and

related products to address potential intermarket manipulations and trading abuses. The ISG

was developed specifically to detect, prevent, and, when necessary, support enforceme

proceedings related to potential fraud and manipulation across members' markets. To that end,

each member of the ISG has agreed to the exchange of information, upon request from another

ISG member, relating to transactions in any Financial Instruments, that relate to possible fraud

and manipulation. Therefore, for this limited purpose, each ISG member “shall provide any

information or documents...” requested by another ISG member. ISG membership also requires

each and every ISG member, including other CFTC-regulated entities, provide any requested

documents that they could obtain for their own reviews for fraud or manipulation, including any

Crypto.com | Derivatives North America

200 West Jackson Blvd., Suite 1400

Chicago, IL 60606

5
documentation from spot cryptocurrency markets obtainable by other ISG members in the

ordinary course of business. Thus, the Exchange believes its ISG membership gives it access to

a broad swath of data from underlying spot cryptocurrency markets through other ISG members

who have the direct ability to request such data from spot markets for the limited purpose of

detecting and preventing fraud and manipulation. The Exchange has also obtained information

sharing agreements with certain spot cryptocurrency markets.

The Exchange certifies that its surveillance program together with its participation in a k

industry group for information sharing and regulatory coordination addresses the requirements

of Core Principle 2.

Core Principle 3 Contracts Not Readily Susceptible to Manipulation and Core Principle 4

Prevention of Market Disruption

Core Principles 3 and 4 (Contracts Not Readily Subject to Manipulation and Prevention of

Market Disruption), implemented by Commission Regulations 38.200 and 38.250, require a DCM

to list only contracts that are not readily susceptible to manipulation and to prevent market

disruption. The Exchange has three of its existing Market Makers that have committed to

providing liquidity in these contracts, which should limit opportunities for markets in the Event

Contracts to be manipulated. As previously stated, the Exchange also uses the SCILA

surveillance system to assist with market monitoring and has a staff dedicated to market

surveillance to detect potential market manipulation.

As to the LTC Crypto Event Contract, the Exchange has selected the Underlying cryptocurrency

markets upon which to base its Crypto Contracts in large part due to their active markets in

terms of volume and liquidity, and their popularity among consumers, institutional investors, and

other financial professionals. Moreover, the Exchange Calculation Method significantly red

the potential for manipulation of the relevant the Exchange Indicative Index by removing a

percentage of the upper and lower Underlying prices from the data set of ICE Crypto Data

leading up to Expiration of the LTC Crypto Event Contract, with the remaining prices averaged.

ICE Crypto Data is comprised of numerous data points from numerous trading venues, which

can be customized by the Exchange. Accordingly, an individual trading the LTC Crypto Event

Contract would not have knowledge of the specific trading venue(s) from which the final se

ICE Crypto Data will be used to calculate the Expiration Value, further preventing the potential for

manipulation of the LTC Crypto Event Contract’s settlement by trading in the Underlying markets.

The Exchange has dedicated staff to surveil the market and uses the Scila surveillance system

to assist with market monitoring at all times the LTC Crypto Event Contract will be listed.

Additionally, the Exchange will monitor the ICE Crypto Data feed for anomalies and

disproportionate moves in the prices making up the Expiration Value. The Exchange will be able

to obtain information from the ICE Crypto Data to assist in the Exchange’s market surveillance,

such as, the relevant cryptocurrency trade price, bid and ask prices, activity date and time, venue

at which the trade occurred, size, volume, daily high and low, and a number of other data points.

IDCF has agreed that upon the Exchange’s request arising as the result of a regulatory

Crypto.com | Derivatives North America

200 West Jackson Blvd., Suite 1400

Chicago, IL 60606

6
investigation or related market data inquiry, it will share with the Exchange additional

information that may be provided by Blockstream, to the extent that it is reasonably practicable,

and does not violate applicable laws, regulations and/or any of IDCF’s, or LDF’s, contractual

obligations.

The Exchange trading system has a cap-check feature that ensures a trader has sufficient fu

in the account to fully collateralize the Order if executed before the Order is accepted by the

Exchange. The Exchange also has the ability to block new Orders and/or cancel working Orders

if necessary to prevent market disruption.

Additionally, Regulation 38.256 requires a DCM to have the ability to comprehensively and

accurately reconstruct all trading on its trading facility. The Exchange is currently able to

reconstruct trading in its markets based on the data stored in the database, the SCILA

surveillance system, as well as the Exchange log files. Trade data will continue to be stored 

this same manner following the addition of the Event Contracts. Therefore, the addition of these

contracts will not negatively impact the Exchange’s ability to comply with these Core Principles.

Core Principle 5 Position Limits

Core Principle 5 requires the DCM set position limits or position accountability to reduce the

potential threat of market manipulation or congestion. The Exchange has set the initial position

limit for Trading Members at 2,500 Contracts, thereby reducing the motivation for an individual

to manipulate the Underlying market in order to affect the Exchange settlement, explained in

detail above. Contracted Market Makers will not be subject to the 2,500 Contract position limit

in order to provide sufficient liquidity to the market. Market Makers will instead be subject to

Alternative Position Limit of two times per strike level for non-Market Maker Trading Members

(i.e. 5,000 Contracts per strike level). Additionally, such Alternative Position Limits shall apply

not to the entire Class of Touch Bracket Contracts, but to each Touch Bracket Contract in that

Class (i.e., per strike). A Market Maker taking advantage of the Alternative Position Limits must,

within 1 business day following a request by the Exchange’s Compliance Department, provide

the Exchange Compliance Department with a trade register detailing all trading activity in any

account owned or controlled by the Market Maker in the relevant Underlying market during the

15 minutes immediately before and after any Expiration time identified by the Exchange

Compliance Department in the request.

Core Principle 7 Availability of General Information and Core Principle 8 Daily Publication of

Information

Core Principles 7 and 8, implemented by Regulations 38.400, 38.401, 38.450, and 38.451, require

a DCM to make available to the public accurate information regarding the contract terms and

conditions, as well as daily information on contracts such as settlement price, volume, open

interest, and opening and closing ranges. The Exchange makes the Exchange Rulebook

available on its website, as well as the Daily Bulletin which contains the preceding required

information. The Results page on the website also publishes the Expiration Value and

Crypto.com | Derivatives North America

200 West Jackson Blvd., Suite 1400

Chicago, IL 60606

7
Settlement Value for all the Exchange contracts settled during that week. Contract

specifications for the New Event Contracts will likewise be set forth in the Rulebook and on t

Exchange website. Settlement prices, volume, open interest, and opening and closing ranges for

the LTC Crypto Event Contract will be included on the Daily Bulletin and posted on the Exchange

website. Therefore, the addition of the LTC Crypto Event Contract will not negatively impact the

Exchange’s ability to comply with these Core Principles.

Core Principle 9 Execution of Transactions

Core Principle 9 requires the DCM to provide a competitive, open, and efficient market 

mechanism for executing transactions that protects the price discovery process. The Exchange

has two dedicated Market Makers that have committed to pricing a two-sided market. Market

participants are able to view the orderbook up to five layers deep (depending on the mark

activity at any particular time) on the platform. The Exchange displays the Time and Sales of all

Contracts traded on the Exchange website which is updated every 15 minutes. Therefore, the

addition of the LTC Crypto Event Contract will not negatively impact the Exchange’s ability to

comply with this Core Principle.

Core Principle 10 Trade Information

Core Principle 10 requires the DCM to maintain rules and procedures to provide for the

recording and safe storage of all identifying trade information in a manger that enables the

contract market to use the information to assist in the prevention of customer and market

abuses and to evidence any violations of the Exchange Rules. The Exchange maintains an

electronic audit trail as required by the Commission Regulations which enables the Exchange to

review all activity on the Exchange.

Core Principle 11 Financial Integrity of Transactions

Core Principle 11 requires the DCM to establish and enforce rules and procedures for ensuring

the financial integrity of transactions entered on the contract market. As with all Contrac

offered on the Exchange, the LTC Crypto Event Contracts will be fully collateralized and

Members entering a transaction will have knowledge of their maximum risk prior to executing a

transaction. All transactions will be cleared by the Exchange DCO.

Core Principle 12 Protection of Markets and Market Participants

Core Principle 12 requires a DCM to protect markets and market participants from abusive

practices committed by any party and to promote fair and equitable trading on the contract

market. Chapter 5 of the Exchange Rulebook establishes Rules to protect the market and

market participants from abusive, disruptive, fraudulent, noncompetitive, and unfair conduct and

trade practices. The Rules apply to all market participants and transactions on the Exchange,

and participants will need to comply with the Rules when trading the LTC Crypto Event Contract.

Crypto.com | Derivatives North America

200 West Jackson Blvd., Suite 1400

Chicago, IL 60606

8
Core Principle 18 Recordkeeping

Finally, Core Principle 18, implemented by Regulation 38.951, requires a DCM to maintain

records in accordance with part 45, Swap Data Recordkeeping and Reporting Requirements. In

early 2013, the Exchange and CFTC staff engaged in discussions regarding the classification 

its Event Contracts and Variable Payout Contracts following the Dodd-Frank amendments to the

Act. The review resulted in the determination that the Exchange Event Contracts and Variable

Payout Contracts were deemed to be “swaps” under Section 1a(47) of the Act. On June 30,

2017, the Exchange was granted relief in CFTC Letter No. 17-31 (the “Letter”) from Commission

Regulations 38.8(b), 38.10, 38.951 (in part), 39.20(b)(2) and Parts 43 and 45 with respect to its

Event and spread contracts. The Event Contracts are Event options that will be covered by the

relief letter, and therefore any trading activity in these contracts will not be reported to a swap

data repository. the Exchange will continue to meet the requirements for which it has not been

granted relief, as well as the conditional requirements set forth in the Letter. Therefore, the

amendments discussed herein will negatively impact the Exchange’s ability to comply with this

Core Principle.

DCO Core Principles

The Exchange has identified the following Derivatives Clearing Organization (“DCO”) Co

Principles as potentially being impacted by the addition of the Event Contracts: Core Principle C

(Participant and Product Eligibility), Core Principle D (Risk Management), Core Principle E

(Settlement Procedures), Core Principle G (Default Rules Procedures) Core Principle K

(Recordkeeping), and Core Principle L (Public Information).

Core Principle C Participant and Product Eligibility

Core Principle C, implemented by Regulation 39.12, requires a DCO to determine the eligibility of

contracts for clearing. The Exchange has determined the LTC Crypto Event Contracts will be

eligible for clearing as trading in these event contracts will be on a fully-collateralized basis, as

required by the Exchange’s Order of Designation, thereby mitigating any credit risk of a particular

member to the Exchange or any other market participant.

Core Principle D Risk Management

Core Principle D requires the DCO to ensure it possesses the ability to manage the risks

associated with discharging its responsibilities through the use of appropriate tools and

procedures. Pursuant to the Exchange’s DCO Orders of Designation, all Contracts cleared

through the Exchange are fully-collateralized. No Contracts are traded on margin, thereby

minimizing the Exchange’s risk if a Member becomes insolvent. Likewise, the Exchange

Members face no credit risk from the Exchange because the Exchange’s obligation to those

Members is limited to the amounts those Members deposit with the Exchange for trading

purposes, and those funds are kept in a segregated Member Property account at the settlement

bank and may not be used to satisfy the obligations of the Exchange.

Crypto.com | Derivatives North America

200 West Jackson Blvd., Suite 1400

Chicago, IL 60606

9
Core Principle E Settlement Procedures

Core Principle E, implemented by Regulation 39.14, includes in the definition of ‘settlement’, th

is, “[a]ll payments due in final settlement of futures, options, and swaps on the final settle

date with respect to such positions”. The Exchange’s LTC Crypto Event Contract will settle in a

timely manner after the Expiration Value is published by the relevant federal government

department. Also, in accordance with this Core Principle, the Exchange will continue to maintain

an accurate record of the flow of funds associated with each settlement of the LTC Crypto Eve

Contract. Therefore, the additions discussed herein will not negatively impact the Exchange’s

ability to comply with this Core Principle.

Core Principle G Default Rules and Procedures

Core Principle G requires the DCO to have rules and procedures designed to allow for the

efficient, fair, and safe management of events during which Members become insolvent

otherwise default on the obligations to other Members or the DCO. The Exchange does not

allow Members to trade if their transactions are not fully collateralized. The Exchange

cap-check system will check the Member’s account when an Order is placed, and if the account

lacks sufficient funds to collateralize the trade, the Order is not accepted by the Exchange. 

to this system check, Members cannot default on their obligations to the Exchange as it relates

to trade collateralization. As a backup provision, the Exchange also has the authority under the

Exchange Rules 5.3 and 5.4 to cancel any Orders if the Member account lacks sufficient fu

to fully collateralize the trade. the Exchange Rule 3.3(d) requires each Member to immediately

notify the Exchange in writing upon becoming aware that he/she/it becomes the subject of a

bankruptcy petition, receivership proceeding, or the equivalent, or being unable to meet any

financial obligation as it becomes due. The Exchange may also sanction Members under Ru

5.19 for failure to retain sufficient collateral in his/her/its account to meet his/her/its fina

obligations. These system checks and applicable Rules will continue to apply following the

addition of the LTC Crypto Event Contracts.

Core Principle K Recordkeeping

Core Principle K, implemented by Regulation 39.20, requires a DCO that clears swaps and

maintains swap data in accordance with the requirements of part 45. As indicated above, the

Exchange has been granted relief from Commission Regulations 38.8(b), 38.10, 38.951 (in part),

39.20(b)(2) and Parts 43 and 45 in CFTC Letter No. 17-31 with respect to its Event option and

spread contracts. The Exchange will continue to meet the requirements for which it has not

been granted relief, as well as the conditional requirements set forth in the Letter.

Crypto.com | Derivatives North America

200 West Jackson Blvd., Suite 1400

Chicago, IL 60606

10
Core Principle L Public Information

Core Principle L, implemented by Regulation 39.21, requires a DCO to make available to the

public the terms and conditions of each contract, as well as the daily settlement prices, volume,

and open interest of the contract. As stated previously, the Rulebook contains the contract

specifications for all contracts listed on the Exchange and is made available to the public on t

Exchange website. All settlement values are listed on the Exchange website on the ‘Results

Page’, as well as the Daily Bulletin which also shows volume and open interest. Therefore, the

amendments discussed herein will not negatively impact the Exchange’s ability to comply with

this Core Principle.

* * * * *

In accordance with §40.2(a)(2) of the Commission’s Regulations, the Exchange plans to begin

listing the LTC Crypto Event Contracts for the start of business on or after the trade date

November 1, 2023.

A complete index of the DCM and DCO Core Principles that indicates whether the Core Principle

is applicable and addressed in the text of this submission is attached in Exhibit A. The contract

specifications as they will appear in the Rulebook are set forth in Exhibit 

The Exchange hereby certifies that the additions contained herein comply with the Act, 

amended, and the Commission Regulations adopted thereunder. No substantive opposing views

were expressed to the Exchange with respect to any of these actions. The Exchange hereby

certifies that a copy of these additions was posted on its website at the time of this fil

Should you have any questions regarding the above, please do not hesitate to contact me by

telephone at (312) 884-0161 or by email at Kevin.Dan@nadex.com.

Sincerely,

/s/

Kevin Dan

Chief Compliance Offi

Crypto.com | Derivatives North America

200 West Jackson Blvd., Suite 1400

Chicago, IL 60606

11
EXHIBIT A

Designated Contract Market (“DCM”) Core Principles

Core Principle

Number

Core Principle Name Addressed in or Not

Applicable to

Self-Certificati

1 Designation as Contract Market Not applicable (designation

granted)

2 Compliance with Rules Addressed

3 Contracts Not Readily Subject to

Manipulation

Addressed

4 Prevention of Market Disruption Addressed

5 Position Limitations or Accountability Addressed

6 Emergency Authority Not applicable (the Exchange

Rulebook, 2.4 Emergency

Rules)

7 Availability of General Information Addressed

8 Daily Publication of Trading Information Addressed

9 Execution of Transactions Addressed

10 Trade Information Addressed

11 Financial Integrity of Transactions Addressed

12 Protection of Markets and Market

Participants

Addressed

13 Disciplinary Procedures Not applicable (the Exchange

Rulebook, Chapter 9 Rule

Enforcement)

14 Dispute Resolution Not applicable (the Exchange

Rulebook, 10.2 – 10.4

Arbitration)

15 Governance Fitness Standards Not applicable (the Exchange

Rulebook, 2.2 Service

Crypto.com | Derivatives North America

200 West Jackson Blvd., Suite 1400

Chicago, IL 60606

12
Restrictions, 11.2 Service and

Disciplinary History)

16 Conflicts of Interest Not applicable (the Exchan

Rulebook, 2.6 Voting, 2.9

Trading Limitations, 11.1

Non-Public Information, 11.3

Voting)

17 Composition of Governing Boards of

Contract Markets

Not applicable (internal

review and appointment of

directors)

18 Recordkeeping Addressed

19 Antitrust Considerations Not applicable

20 System Safeguards Not applicable (internal

controls and policies in

place)

21 Financial Resources Not applicable (capital

requirements and quarterly

reporting compliant)

22 Diversity of Boards of Directors Not applicable (not public

company, internal review and

appointment of directors)

23 Securities and Exchange Commission Not applicable

Crypto.com | Derivatives North America

200 West Jackson Blvd., Suite 1400

Chicago, IL 60606

13
Derivatives Clearing Organization (“DCO”) Core Principles

Core Principle

Number

Core Principle Name Addressed in or Not

Applicable to

Self-Certificati

A Compliance Not applicable

B Financial Resources Not applicable (capital

requirement and quarterly

reporting compliant)

C Participant and Product Eligibility Addressed

D Risk Management Addressed

E Settlement Procedures Addressed

F Treatment of Funds Not applicable (the Exchange

Rulebook Chapter 8 Member

Funds)

G Default Rules and Procedures Addressed

H Rule Enforcement Not applicable (the Exchange

Rulebook, Chapter 9 Rule

Enforcement, 10.2 – 10.4

Arbitration)

I System Safeguards Not applicable (internal

controls and policies in

place)

J Reporting Not applicable

K Recordkeeping Not applicable (the Exchange

maintains all required

records for at least 5 years)

L Public Information Addressed

M Information Sharing Not applicable (member of

Joint Audit Committee, Joint

Compliance Committee,

Intermarket Surveillance

Group, and signatory to the

International Information

Crypto.com | Derivatives North America

200 West Jackson Blvd., Suite 1400

Chicago, IL 60606

14
Sharing Memorandum of

Understanding and

Agreement)

N Antitrust Considerations Not applicable

O Governance Fitness Standards Not applicable (the Exchange

Rulebook, 2.2 Service

Restrictions, 11.2 Service and

Disciplinary History, internal

review and appointment of

directors)

P Conflicts of Interest Not applicable (the Exchan

Rulebook, 2.6 Voting, 2.9

Trading Limitations, 11.1

Non-Public Information, 11.3

Voting)

Q Composition of Governing Boards Not applicable (internal

review and appointment of

directors)

R Legal Risk Not applicable (the Exchange

Rulebook Chapter 6)

Crypto.com | Derivatives North America

200 West Jackson Blvd., Suite 1400

Chicago, IL 60606

15
EXHIBIT B

The Contract Specifications set forth below will appear in the Rulebook as 12.9

RULES 1.1 – 12.97 [UNCHANGED]

12.98 LITECOIN (LTC) CRYPTOCURRENCY EVENT CONTRACTS

(a) SCOPE – These Rules shall apply to the Class of Contracts referred to as the Litecoin

Cryptocurrency (“Litecoin” or “LTC”) Event Contracts, referred to as an ‘Event Contract”, issued by

the Exchange.

(b) UNDERLYING – The Underlying for this Class of Contracts is the spot Litecoin

cryptocurrency commodity bid/ask midpoint prices reported by Lukka, Inc. and the ICE

®

Cryptocurrency Data aggregated by Blockstream® Corporation and distributed by ICE Data

®

Connectivity and Feeds, Inc., herein referred to as “U-LTC”, quoted in US dollars.

(c) SOURCE AGENCY – The Source Agency is the Exchange.

(d) TYPE – The Type of Contract is an Event Contract, which is a Swap.

(e) PAYOUT CRITERION – The Payout Criterion for each Contract will be set by the Exchange at

the time the Event Contracts are initially issued. For the Litecoin Event Contracts, the Payout

Criteria for the Contracts will be set as forth below or as updated on the Exchange’s Trading

System:

(i) DAILY LITECOIN EVENT CONTRACTS

(1) EXPIRATION TIME – 5 PM Saturday thru Thursday; 4 PM Friday.

(2) STRIKE INTERVAL WIDTH – The interval width between each strike level shall

be 0.8.

(3) NUMBER OF STRIKE LEVELS LISTED – Nine (9) strike levels will be listed for

each Daily Litecoin Event Contract Series.

(4) STRIKE LEVELS GENERATED - Strike levels will be generated such that Event

Contract “X” is valued ‘at-the-money’ in relation to the Underlying market as

determined by the Source Agency, immediately before the issuance of these

Contracts, and shall be measured in U.S. cents rounded to the nearest value

ending in either 0.00, 0.0025, 0.0050, 0.0075 as reported by the Source Agency.

Four (4) strike levels will be generated above Event Contract X at an interval of Y,

Crypto.com | Derivatives North America

200 West Jackson Blvd., Suite 1400

Chicago, IL 60606

16
and four (4) strike levels will be generated below Event Contract X at an interval

of Y (e.g. X – Y; X; X + Y). The Contract will have a Payout Criterion of greater

than the strike level value.

(ii) INTRADAY LITECOIN EVENT CONTRACTS

(1) EXPIRATION TIME – Every 2 Hours and every 20 minutes with the fir

expiration occurring at 1:00 am ET Saturday, and 11:20 pm ET Friday,

respectively, and the final expiration occurring the following Friday at the 4:00 

ET CLOSE.

(2) STRIKE INTERVAL WIDTH – The interval width between each strike level

shall be 0.2 for 2-Hour LTC Event Contracts, and 0.085 for 20-minutes LTC Event

Contracts.

(3) NUMBER OF STRIKE LEVELS LISTED – Nine (9) strike levels will be listed

for each Intraday 2-Hour Litecoin Event Contract Series.

(4) STRIKE LEVELS GENERATED - Strike levels will be generated such that

Event Contract “X” is valued ‘at-the-money’ in relation to the Underlying market as

determined by the Source Agency, immediately before the issuance of these

Contracts, and shall be measured in U.S. cents rounded to the nearest value

ending in either 0.00, 0.010, .0025, 0.0050, 0.0075 as reported by the Source

Agency. Four (4) strike levels will be generated above Event Contract X at an

interval of Y, and four (4) strike levels will be generated below Event Contract X at

an interval of Y (e.g. Y – X; Y; Y + X). The Contract will have a Payout Criterion of

greater than the strike level value.

(iii) Nadex may list additional Litecoin Event Contracts with different ranges of Payout

Criteria on a discretionary basis in accordance with the CEA and Commission

Regulations.

(f) MINIMUM TICK – The Minimum Tick size for Litecoin Event Contracts shall be $0.1 to $0.25.

(g) POSITION LIMIT – The Position Limits for Litecoin Event Contracts shall be from 2,500 to

25,000 Contracts per Class.

(h) MARKET MAKER ALTERNATIVE POSITION LIMIT – The Position Limit for the Litecoin Event

Contracts for contracted Market Makers shall be from 5,000 to 50,000 per strike level.

(i) LAST TRADING DATE – The Last Trading Date in a Series is the same as the Expiration Date.

No trading in the Litecoin Event Contracts shall occur after its Last Trading Date.

Crypto.com | Derivatives North America

200 West Jackson Blvd., Suite 1400

Chicago, IL 60606

17
(j) SETTLEMENT DATE – The Settlement Date will be the date on which the Litecoin price as

reported by the Source Agency.

(k) EXPIRATION DATE – The Expiration Date of the Contract will be the date on which the

Litecoin price is released.

(l) SETTLEMENT VALUE – The Settlement Value is the amount paid to the holder of the in the

money Contract on the Settlement Date. The Settlement Value of an in the money Litecoin Event

Contract is from $10 to $100.

(m) EXPIRATION VALUE – The Expiration Value is the Litecoin Index Value calculated and

produced by the Source Agency on the Expiration Date. The Source Agency shall calculate and

produce an LTC Index Value once each second throughout the life of the LTC Touch Bracket

Contracts. That is, each second the Source Agency will calculate a LTC Index Value by taking by

taking all U-LTC bid/ask midpoint prices occurring in the sixty (60) seconds leading up to the

Calculation Time, provided at least twenty-five (25) bid/ask midpoint prices are captured duri

the sixty (60) second period, removing the highest twenty (20) percent of U-LTC bid/ask

midpoint prices and the lowest twenty (20) percent of U-LTC bid/ask midpoint prices from the

data set

7

, and using the remaining U-LTC bid/ask midpoint prices to calculate the LTC Index

Value for that second. The calculation used is a simple average of the remaining U-LTC bid/ask

midpoint prices in the data set, rounded to one decimal point past the precision of the

Underlying market. In the event the time it takes to collect at least twenty-five (25) U-L

bid/ask midpoint prices exceeds the sixty (60) second period, the LTC Index Value will be

calculated by the Source Agency by taking the last twenty-five (25) U-LTC bid/ask midpoi

prices just prior to the Calculation Time, removing the highest five (5) U-LTC bid/ask midpoi

prices and the lowest five (5) U-LTC bid/ask midpoint prices, and using the remaining fifteen 

U-LTC bid/ask midpoint prices to calculate the LTC Index Value. The calculation used is a

simple average of all fifteen (15) U-LTC bid/ask midpoint prices, rounded to one decimal poi

past the precision of the Underlying market.

(n) CONTINGENCIES – If no level is actually announced on the Expiration Date due to a delay,

postponement or otherwise in such release announcement by the Source Agency, the

Settlement Date will be delayed until the Underlying number is released for that Series.

7

If 20% of the data set would result in a non-integer number of bid/ask midpoint prices, the number of bid/ask

midpoint prices to be removed from the set will be rounded down. For example, if the number of bid/ask midpoint

prices collected during the last 10 seconds prior to the close of trading was 31, 20% of the data set would be 6.2

bid/ask midpoint prices prices. As 6.2 is a non-integer number, the value will be rounded down, and the 6 highest and

6 lowest bid/ask midpoint prices will be removed from the data set.

Crypto.com | Derivatives North America

200 West Jackson Blvd., Suite 1400

Chicago, IL 60606

18