Notice2025-14661
Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Amend Its Fees Schedule To Increase the Monthly Fee for 10 Gb Physical Ports
Primary source
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Published
August 4, 2025
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 90 Issue 147 (Monday, August 4, 2025)</title>
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[Federal Register Volume 90, Number 147 (Monday, August 4, 2025)]
[Notices]
[Pages 36510-36513]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-14661]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-103590; File No. SR-CboeBZX-2025-100]
Self-Regulatory Organizations; Cboe BZX Exchange, Inc.; Notice of
Filing and Immediate Effectiveness of a Proposed Rule Change To Amend
Its Fees Schedule To Increase the Monthly Fee for 10 Gb Physical Ports
July 30, 2025.
Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given that
on July 29, 2025, Cboe BZX Exchange, Inc. (the ``Exchange'' or ``BZX'')
filed with the Securities and Exchange Commission (``Commission'') the
proposed rule change as described in Items I, II, and III below, which
Items have been prepared by the Exchange. The Commission is publishing
this notice to solicit comments on the proposed rule change from
interested persons.
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\1\ 15 U.S.C. 78s(b)(1).
\2\ 17 CFR 240.19b-4.
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change
Cboe BZX Exchange, Inc. (the ``Exchange'' or ``BZX Options'')
proposes to amend its Fees Schedule. The text of the proposed rule
change is provided in Exhibit 5.
The text of the proposed rule change is also available on the
Exchange's website (<a href="http://markets.cboe.com/us/equities/regulation/rule_filings/BZX/">http://markets.cboe.com/us/equities/regulation/rule_filings/BZX/</a>) and at the Exchange's Office of the Secretary.
II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The Exchange has prepared summaries, set forth in
sections A, B, and C below, of the most significant aspects of such
statements.
A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change
1. Purpose
The Exchange proposes to amend its fee schedule relating to
physical connectivity fees.\3\
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\3\ The Exchange initially filed the proposed fee changes on
July 3, 2023 (SR-CboeBZX-2023-047). On September 1, 2023, the
Exchange withdrew that filing and submitted SR-CboeBZX-2023-068. On
September 29, 2023, the Securities and Exchange Commission issued a
Suspension of and Order Instituting Proceedings to Determine whether
to Approve or Disapprove a Proposed Rule Change to Amend its Fees
Schedule Related to Physical Port Fees (the ``OIP'') in anticipation
of a possible U.S. government shutdown. On September 29, 2023, the
Exchange filed the proposed fee change (SR-CboeBZX-2023-79). On
October 13, 2023, the Exchange withdrew that filing and submitted
SR-CboeBZX-2023-083. On December 12, 2023 the Exchange withdrew that
filing and submitted SR-CboeBZX-2023-104. On February 9, 2024, the
Exchange withdrew that filing and submitted SR-CboeBZX-2024-017. On
April 9, 2024, the Exchange withdrew that filing and submitted this
SR-CboeBZX-2024-028. On April 18, 2024, the Exchange withdrew that
filing and submitted SR-CboeBZX-2024-030. On June 7, 2024, the
Exchange withdrew that filing and submitted SR-CboeBZX-2024-052. On
August 29, 2024, the Exchange withdrew that filing and submitted SR-
CboeBZX-2024-080. On October 25, 2024, the Exchange withdrew that
filing and submitted SR-CboeBZX-2024-107. On October 28, 2024, the
Exchange withdrew that filing and submitted SR-CboeBZX-2024-109. On
December 18, 2024 the Exchange withdrew that filing and submitted
SR-CboeBZX-2024-128. On February 14, 2025, the Exchange withdrew
that filing and submitted SR-CboeBZX-2025-030. On March 13, 2025,
the Exchange withdrew that filing and submitted SR-CboeBZX-2025-043.
On May 9, 2025, the Exchange withdrew that filing and submitted this
SR-CboeBZX-2025-066. On July 7, 2025, the Exchange withdrew that
filing and submitted SR-CboeBZX-2025-088. On July 17, 2025, the
Exchange withdrew that filing and submitted SR-CboeBZX-2025-094. On
July 29, 2025, the Exchange withdrew that filing and submitted this
filing.
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[[Page 36511]]
By way of background, a physical port is utilized by a Member or
non-Member to connect to the Exchange at the data centers where the
Exchange's servers are located. The Exchange currently assesses the
following physical connectivity fees for Members and non-Members on a
monthly basis: $2,500 per physical port for a 1 gigabit (``Gb'')
circuit and $7,500 per physical port for a 10 Gb circuit. The Exchange
proposes to increase the monthly fee for 10 Gb physical ports from
$7,500 to $8,500 per port. The Exchange notes the proposed fee change
better enables it to continue to maintain and improve its market
technology and services and also notes that the proposed fee amount,
even as amended, continues to be in line with, or even lower than,
amounts assessed by other exchanges for similar connections.\4\ The
Exchange also notes that a single 10 Gb physical port can be used to
access the Systems of the following Affiliate Exchanges: the Cboe BYX
Exchange, Inc. (equities), Cboe EDGX Exchange, Inc. (options and
equities platforms), Cboe EDGA Exchange, Inc., and Cboe C2 Exchange,
Inc., (``Affiliate Exchanges'').\5\ Notably, only one monthly fee
currently (and will continue) to apply per 10 Gb physical port
regardless of how many Affiliate Exchanges are accessed through that
one port.\6\
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\4\ See e.g., The Nasdaq Stock Market LLC (``Nasdaq''), General
8, Connectivity to the Exchange. Nasdaq and its affiliated exchanges
charge a monthly fee of $16,500 for each 10Gb Ultra fiber connection
to the respective exchange. See also New York Stock Exchange LLC,
NYSE American LLC, NYSE Arca, Inc., NYSE Chicago Inc., NYSE
National, Inc. Connectivity Fee Schedule, which provides that 10 Gb
LX LCN Circuits (which are analogous to the Exchange's 10 Gb
physical port) are assessed $22,000 per month, per port.
\5\ The Affiliate Exchanges are also submitting contemporaneous
identical rule filings.
\6\ The Exchange notes that conversely, other exchange groups
charge separate port fees for access to separate, but affiliated,
exchanges. See e.g., Securities and Exchange Release No. 99822
(March 21, 2024), 89 FR 21337 (March 27, 2024) (SR-MIAX-2024-016).
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2. Statutory Basis
The Exchange believes the proposed rule change is consistent with
the Securities Exchange Act of 1934 (the ``Act'') and the rules and
regulations thereunder applicable to the Exchange and, in particular,
the requirements of Section 6(b) of the Act.\7\ Specifically, the
Exchange believes the proposed rule change is consistent with the
Section 6(b)(5) \8\ requirements that the rules of an exchange be
designed to prevent fraudulent and manipulative acts and practices, to
promote just and equitable principles of trade, to foster cooperation
and coordination with persons engaged in regulating, clearing,
settling, processing information with respect to, and facilitating
transactions in securities, to remove impediments to and perfect the
mechanism of a free and open market and a national market system, and,
in general, to protect investors and the public interest. Additionally,
the Exchange believes the proposed rule change is consistent with the
Section 6(b)(5) \9\ requirement that the rules of an exchange not be
designed to permit unfair discrimination between customers, issuers,
brokers, or dealers. The Exchange also believes the proposed rule
change is consistent with Section 6(b)(4) \10\ of the Act, which
requires that Exchange rules provide for the equitable allocation of
reasonable dues, fees, and other charges among its Members and other
persons using its facilities. This belief is based on various factors
as described below.
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\7\ 15 U.S.C. 78f(b).
\8\ 15 U.S.C. 78f(b)(5).
\9\ Id.
\10\ 15 U.S.C. 78f(b)(4).
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The Exchange believes the proposed fees are reasonable as they are
lower than, the amounts assessed by equities exchanges for analogous
market access connections and which were similarly adopted via the rule
filing process and filed with the Commission. The Exchange further
notes that other the exchanges that offer similar pricing for similar
or the same connections have a comparable, or even lower, market share
as the Exchange, as detailed further below. Indeed, the Exchange has
reviewed the U.S. options market share \11\ for each of the eighteen
options markets utilizing total shares traded in 2025 through July 2,
2025, as set forth in the following graph:
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\11\ Market share is the percentage of volume on a particular
exchange relative to the total volume across all exchanges and
indicates the amount of order flow directed to that exchange. High
levels of market share enhance the value of trading and ports.
[GRAPHIC] [TIFF OMITTED] TN04AU25.002
[[Page 36512]]
More specifically, the Exchange notes that the proposed physical
port fee of $8,500 per month, per physical port, is comparable to fees
charged by other exchanges with similar, or greater, market share.
These comparisons are summarized in Table 1:
Table 1
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Market share
Exchange (%) Monthly fee per port
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BZX Options.................... 4.3 Proposed $8,500 for
each 10 Gb Physical
Port Connection.
MIAX Options................... 7.2 $13,500 per port.
MIAX Pearl..................... 2.7 $13,500 per port.
MIAX Emerald................... 3.9 $13,500 per port.
MIAX Sapphire.................. 2.6 $13,500 per port.
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Specifically, the Exchange points towards the equivalent offering
from MIAX Sapphire \12\ and its affiliated options exchanges, MIAX
Options,\13\ MIAX Pearl \14\ and MIAX Emerald \15\ (collectively,
``MIAX Exchanges'') which is $13,500 per port per month. The Exchange
reiterates that a single physical port offering from the Exchange
offers the ability to connect to the Affiliated Exchanges (equities and
options) and the monthly price does not change based on the number of
exchanges a participant is connected to. In this case, examining only
the Exchange and its Affiliated Options Exchanges, (even though the
same physical port could also connect to the Exchange's affiliated
equities exchanges) a participant could purchase a single physical port
from the Exchange and access roughly 14% of the U.S. Options Market for
a cost of $8,500. In contrast, if a participant desired to access all
MIAX Exchanges, allowing access to roughly 16% of the U.S. Options
Market, it would cost that participant $54,000 ($13,500 per port per
month x 4 MIAX Exchanges).
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\12\ See MIAX Sapphire Options Fee Schedule, available at:
<a href="https://www.miaxglobal.com/alert/2024/08/08/miax-sapphire-options-exchange-august-12-2024-fees">https://www.miaxglobal.com/alert/2024/08/08/miax-sapphire-options-exchange-august-12-2024-fees</a>.
\13\ See MIAX Options Fee Schedule, available at: <a href="https://www.miaxglobal.com/markets/us-options/miax-options/fees">https://www.miaxglobal.com/markets/us-options/miax-options/fees</a>.
\14\ See MIAX Pearl Options Fee Schedule, available at: <a href="https://www.miaxglobal.com/markets/us-options/pearl-options/fees">https://www.miaxglobal.com/markets/us-options/pearl-options/fees</a>.
\15\ See MIAX Emerald Options Fee Scheduled, available at:
<a href="https://www.miaxglobal.com//us-options/emerald-options/fees">https://www.miaxglobal.com//us-options/emerald-options/fees</a>.
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In addition, as demonstrated in the Mutli-List Market Share Chart
(above), the Exchange believes its proposal is reasonable as it
reflects a moderate increase in physical connectivity fees for 10 Gb
physical ports and its offering. As amended, the Exchange's proposed
fee continues to be more affordable as compared to analogous physical
connectivity offerings at competitor exchanges. For example, The Nasdaq
Stock Market LLC (``Nasdaq'') and its affiliated exchanges charge a
monthly fee of $16,500 for each 10Gbps Ultra fiber connection and
$11,000 per month for each 10 Gbps fiber connection to their respective
exchange. The Exchange's proposed fee of $8,500 per physical port is
lower than both of these offerings.
B. Self-Regulatory Organization's Statement on Burden on Competition
The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act. The proposed fee change will
not impact intramarket competition because it will apply to all
similarly situated Members equally (i.e., all market participants that
choose to purchase the 10 Gb physical port). Additionally, the Exchange
does not believe its proposed pricing will impose a barrier to entry to
smaller participants and notes that its proposed connectivity pricing
is associated with relative usage of the various market participants.
For example, market participants with modest capacity needs can
continue to buy the less expensive 1 Gb physical port (which cost is
not changing) or may choose to obtain access via a third-party re-
seller. While pricing may be increased for the larger capacity physical
ports, such options provide far more capacity and are purchased by
those that consume more resources from the network. Accordingly, the
proposed connectivity fees do not favor certain categories of market
participants in a manner that would impose a burden on competition;
rather, the allocation reflects the network resources consumed by the
various size of market participants--lowest bandwidth consuming members
pay the least, and highest bandwidth consuming members pays the most.
The proposed fee change also does not impose a burden on
competition or on other Self-Regulatory Organizations that is not
necessary or appropriate. As described above, in establishing its
proposed fee change the Exchange compared its proposed fee increase to
that of competitor exchanges' analogous offerings. As noted above, the
proposed fee of $8,500 is less than that Nasdaq Stock Market, LLC's and
its affiliated exchanges fee $16,500 for each 10 Gbps Ultra fiber
connection and $11,000 per month for each 10 Gbps fiber connection to
their respective exchange.
Moreover, the Exchange also points towards the equivalent offering
from MIAX Saphire and its affiliated options exchanges, MIAX Options,
MIAX Pearl and MIAX Emerald (collectively, ``MIAX Exchanges'') which is
$13,500 per port per month. The Exchange reiterates that a single
physical port offering from the Exchange offers the ability to connect
to the Affiliate Exchanges (equities and options) and the monthly price
does not change based on the number of exchanges a participant is
connected to. In this case, examining only the Exchange and its options
Affiliate Exchanges, (even though the same physical port could also
connect to the Exchange's equities Affiliate Exchanges) a participant
could purchase a single physical port from the Exchange and access
roughly 14% of the U.S. options market for a cost of $8,500. In
contrast, if a participant desired to access all MIAX Exchanges,
allowing access to roughly 16% of the U.S. options market, it would
cost that participant $54,000 ($13,500 per port per month x 4 MIAX
Exchanges).
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
The Exchange neither solicited nor received comments on the
proposed rule change.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
The foregoing rule change has become effective pursuant to Section
19(b)(3)(A) of the Act \16\ and paragraph (f) of Rule
[[Page 36513]]
19b-4 \17\ thereunder. At any time within 60 days of the filing of the
proposed rule change, the Commission summarily may temporarily suspend
such rule change if it appears to the Commission that such action is
necessary or appropriate in the public interest, for the protection of
investors, or otherwise in furtherance of the purposes of the Act. If
the Commission takes such action, the Commission will institute
proceedings to determine whether the proposed rule change should be
approved or disapproved.
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\16\ 15 U.S.C. 78s(b)(3)(A).
\17\ 17 CFR 240.19b-4(f).
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IV. Solicitation of Comments
Interested persons are invited to submit written data, views and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:
Electronic Comments
<bullet> Use the Commission's internet comment form (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>); or
<bullet> Send an email to <a href="/cdn-cgi/l/email-protection#d4a6a1b8b1f9b7bbb9b9b1baa0a794a7b1b7fab3bba2"><span class="__cf_email__" data-cfemail="93e1e6fff6bef0fcfefef6fde7e0d3e0f6f0bdf4fce5">[email protected]</span></a>. Please include
file number SR-CboeBZX-2025-100 on the subject line.
Paper Comments
<bullet> Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.
All submissions should refer to file number SR-CboeBZX-2025-100. This
file number should be included on the subject line if email is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>). Copies of the filing will be available for inspection and
copying at the principal office of the Exchange. Do not include
personal identifiable information in submissions; you should submit
only information that you wish to make available publicly. We may
redact in part or withhold entirely from publication submitted material
that is obscene or subject to copyright protection. All submissions
should refer to file number S-CboeBZX-2025-100 and should be submitted
on or before August 25, 2025.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\18\
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\18\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2025-14661 Filed 8-1-25; 8:45 am]
BILLING CODE 8011-01-P
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