Notice2025-21979
Self-Regulatory Organizations; Nasdaq BX, Inc.; Notice of Filing and Immediate Effectiveness of Proposed Rule Change to Proposal To Delay Introduction of BX OTTO
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
December 5, 2025
Issuing agencies
Securities and Exchange Commission
Full Text
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<title>Federal Register, Volume 90 Issue 232 (Friday, December 5, 2025)</title>
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[Federal Register Volume 90, Number 232 (Friday, December 5, 2025)]
[Notices]
[Pages 56216-56218]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-21979]
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SECURITIES AND EXCHANGE COMMISSION
[Release No. 34-104282; File No. SR-BX-2025-028]
Self-Regulatory Organizations; Nasdaq BX, Inc.; Notice of Filing
and Immediate Effectiveness of Proposed Rule Change to Proposal To
Delay Introduction of BX OTTO
December 2, 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 November 19, 2025, Nasdaq BX, Inc. (``BX'' or ``Exchange'') filed
with the Securities and Exchange Commission (``SEC'' or ``Commission'')
the proposed rule change as described in Items I, II, and III, below,
which Items have been prepared by the Exchange. The
[[Page 56217]]
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
The Exchange proposes to delay the implementation of SR-BX-2024-048
\3\ related to ``Ouch to Trade Options'' or ``OTTO.''
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\3\ See Securities Exchange Act Release No. 101743 (November 25,
2024), 89 FR 95321 (December 2, 2024) (SR-BX-2024-048) (Notice of
Filing and Immediate Effectiveness of Proposed Rule Change to Adopt
an OTTO Protocol).
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The text of the proposed rule change is available on the Exchange's
website at <a href="https://listingcenter.nasdaq.com/rulebook/bx/rulefilings">https://listingcenter.nasdaq.com/rulebook/bx/rulefilings</a>,
and at the principal office of the Exchange.
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 delay the implementation of SR-BX-2024-048
related to the adoption of an OTTO Protocol.
Background
The OTTO protocol is a proprietary protocol of Nasdaq, Inc. OTTO
would allow Participants and their Sponsored Customers \4\ to connect,
send, and receive messages related to orders, auction orders, and
auction responses to the Exchange. OTTO features would include the
following: (1) options symbol directory messages (e.g., underlying and
complex instruments); (2) System \5\ event messages (e.g., start of
trading hours messages and start of opening); (3) trading action
messages (e.g., halts and resumes); (4) execution messages; (5) order
messages; (6) risk protection triggers and cancel notifications; (7)
auction notifications; (8) auction responses; and (9) post trade
allocation messages. The Exchange notes that unlike FIX, which offers
routing capability, OTTO does not permit routing.
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\4\ General 2, Section 22 describes Sponsored Access
arrangements.
\5\ The term ``System'' or ``Trading System'' means the
automated system for order execution and trade reporting owned and
operated by BX as the BX Options market. The BX Options market
comprises: (A) an order execution service that enables Participants
to automatically execute transactions in option series; and provides
Participants with sufficient monitoring and updating capability to
participate in an automated execution environment; (B) a trade
reporting service that submits ``locked-in'' trades for clearing to
a registered clearing agency for clearance and settlement; transmits
last-sale reports of transactions automatically to the Options Price
Reporting Authority for dissemination to the public and industry;
and provides participants with monitoring and risk management
capabilities to facilitate participation in a ``locked-in'' trading
environment; and (C) the data feeds described in Options 3, Section
23. See BX Options 1, Section 1(a)(59).
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Delay of Implementation
In connection with adopting the OTTO protocol, SR-BX-2024-048
adopted certain rules which are effective, but not operative.\6\ The
Exchange noted in SR-BX-2024-048 that it would implement the proposed
rules on or before December 20, 2025 and announce the operative date to
Participants in an Options Trader Alert.\7\
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\6\ See supra note 3.
\7\ See id.
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At this time, the Exchange proposes to delay the implementation of
SR-BX-2024-048 to a date on or before Q2 2027. This delay would allow
the Exchange additional time to code and test the OTTO functionality in
light of other technology migrations that are currently underway on
other Nasdaq affiliated markets. The Exchange would issue an Options
Trader Alert announcing the exact implementation date to Participants
at least thirty days prior to implementation.
2. Statutory Basis
The Exchange believes that its proposal is consistent with Section
6(b) of the Act,\8\ in general, and furthers the objectives of Section
6(b)(5) of the Act,\9\ in particular, in that it is designed to promote
just and equitable principles of trade, 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.
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\8\ 15 U.S.C. 78f(b).
\9\ 15 U.S.C. 78f(b)(5).
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The Exchange's proposal to delay the implementation of SR-BX-2024-
048 to a date on or before Q2 2027 is consistent with the Act because
it would allow the Exchange additional time to code and test the OTTO
functionality in light of other technology migrations that are
currently underway on other Nasdaq affiliated markets. The Exchange
would issue an Options Trader Alert announcing the exact implementation
date to Participants at least thirty days prior to implementation.
B. Self-Regulatory Organization's Statement on Burden on Competition
The proposed rule change does not impose any burden on competition
that is not necessary or appropriate in furtherance of the purposes of
the Act.
Delay of Implementation
The Exchange's proposal to delay the implementation of SR-BX-2024-
048 to a date on or before Q2 2027 does not impose an undue burden on
competition because it will allow BX additional time to code and test
the functionality. The new OTTO protocol will not be available to any
BX Participant until implementation.
C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others
No written comments were either solicited or received.
III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action
Because the foregoing proposed rule change does not: (i)
significantly affect the protection of investors or the public
interest; (ii) impose any significant burden on competition; and (iii)
become operative for 30 days from the date on which it was filed, or
such shorter time as the Commission may designate, it has become
effective pursuant to Section 19(b)(3)(A)(iii) of the Act \10\ and
subparagraph (f)(6) of Rule 19b-4 thereunder.\11\
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\10\ 15 U.S.C. 78s(b)(3)(A)(iii).
\11\ 17 CFR 240.19b-4(f)(6). In addition, Rule 19b-4(f)(6)
requires a self-regulatory organization to give the Commission
written notice of its intent to file the proposed rule change at
least five business days prior to the date of filing of the proposed
rule change, or such shorter time as designated by the Commission.
The Exchange has satisfied this requirement.
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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 shall institute proceedings
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to determine whether the proposed rule should be approved or
disapproved.
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#c6b4b3aaa3eba5a9ababa3a8b2b586b5a3a5e8a1a9b0"><span class="__cf_email__" data-cfemail="b6c4c3dad39bd5d9dbdbd3d8c2c5f6c5d3d598d1d9c0">[email protected]</span></a>. Please include
file number SR-BX-2025-028 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-BX-2025-028. 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 SR-BX-2025-028 and should be submitted on
or before December 26, 2025.
For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\12\
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\12\ 17 CFR 200.30-3(a)(12).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2025-21979 Filed 12-4-25; 8:45 am]
BILLING CODE 8011-01-P
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