Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Update Its Fees Schedule in Connection With Binary Options That Overlie the Mini-S&P 500 Index

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<title>Federal Register, Volume 91 Issue 162 (Monday, August 24, 2026)</title>
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[Federal Register Volume 91, Number 162 (Monday, August 24, 2026)]
[Notices]
[Pages 54770-54774]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2026-17203]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-106161; File No. SR-CBOE-2026-071]


Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of 
Filing and Immediate Effectiveness of a Proposed Rule Change To Update 
Its Fees Schedule in Connection With Binary Options That Overlie the 
Mini-S&P 500 Index

August 19, 2026.
    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 August 12, 2026, Cboe Exchange, Inc. (``Exchange'' or ``Cboe 
Options'') 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 Exchange, Inc. (the ``Exchange'' or ``Cboe Options'') proposes 
to update its Fees Schedule in connection with binary options that 
overlie the Mini-S&P 500 Index (``XSP binary options''); specifically, 
the Exchange proposes to adopt certain standard transaction fees in 
connection with XSP binary options and exclude XSP binary options from 
certain fees programs. The text of the proposed rule change is provided 
in Exhibit 5.
    The text of the proposed rule change is also available on the 
Commission's website (<a href="https://www.sec.gov/rules/sro.shtml">https://www.sec.gov/rules/sro.shtml</a>), the 
Exchange's website (<a href="https://www.cboe.com/us/options/regulation/rule_filings/cone/">https://www.cboe.com/us/options/regulation/rule_filings/cone/</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 update its Fees Schedule in connection 
with XSP binary options.\3\
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    \3\ The Exchange initially filed the proposed fee change, among 
other changes, on June 15, 2026 (SR-CBOE-2026-056). On August 12, 
2026, the Exchange withdrew that filing and submitted this proposal.
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    First, the Exchange proposes to adopt certain standard transaction 
fees in connection with XSP binary options (``XSPBX''), as follows: \4\
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    \4\ Under the proposed changes, Footnotes 1, 3, 4, 7, 13, 15, 
39, and 24 (proposed Footnote 24 described below), set forth in the 
Exchange Fees Schedule will apply to Binary Options. As part of the 
proposed changes, the Exchange proposes to append these footnotes to 
the proposed Rates Table for Binary Options. Footnote 1 provides 
that the standard transaction rates set forth in the proposed Rates 
Table apply per contract side, including FLEX; Footnote 3 provides 
that Trading Permit Holder transaction fee policies and rebate 
programs are described in the Trading Permit Holder Transaction Fee 
Policies and Rebate Programs table; Footnote 4 provides that 
transaction fees are charged to the Cboe Options executing firm on 
the input record; Footnote 7 provides that all fees and rebates 
assessed prior to the three full calendar months before the month in 
which the Exchange becomes aware of a billing error shall be 
considered final, and that any dispute concerning fees or rebates 
billed by the Exchange must be submitted to the Exchange in writing 
and must be accompanied by supporting documentation; Footnote 13 
provides that transaction fees for Market-Makers and other specified 
participants are capped at $0.00 for merger, short stock interest, 
reversal, conversion, and jelly roll strategies executed in open 
outcry on the same trading day in the same option class across 
equities, ETFs, and ETNs, with each strategy type specifically 
defined, though strategies tied to QCC orders are ineligible for a 
strategy rebate and those defined in the footnote are ineligible for 
an ORS/CORS subsidy; Footnote 15 provides that under Exchange Rule 
5.26, when exclusively listed options are traded at a Back-up 
Exchange, that exchange will apply Cboe Options' per contract fees, 
while any other Cboe Options listed options traded there will be 
subject to the Back-up Exchange's fee schedule; conversely, when a 
Disabled Exchange's exclusively listed options are traded at Cboe 
Options, Cboe Options will apply the Disabled Exchange's per 
contract fees, while any other options classes of the Disabled 
Exchange traded at Cboe Options will be subject to Cboe Options' fee 
schedule; and Footnote 39 provides that each Trading Permit Holder 
is responsible for notifying the Exchange of all of its affiliates 
and is required to inform the Exchange immediately of any event that 
causes an entity to cease to be an affiliate in a form and manner to 
be determined by the Exchange; an ``affiliate'' is defined as having 
at least 75% common ownership between two entities as reflected on 
each entity's Form BD, Schedule A.
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    <bullet> Adopts fee code D1, appended to all Customer (capacity 
``C'') orders in XSPBX with a premium price less than $0.04 or greater 
than $0.96 and assesses a fee of $0.04 per contract;
    <bullet> Adopts fee code D2, appended to all Customer (capacity 
``C'') orders in XSPBX with a premium price of $0.04 to $0.09 or $0.91 
to $0.96 and assesses a fee of $0.08 per contract;
    <bullet> Adopts fee code D3, appended to all Customer (capacity 
``C'') orders in XSPBX with a premium price of $0.10 to $0.24 or $0.76 
to $0.90 and assesses a fee of $0.20 per contract;
    <bullet> Adopts fee code D4, appended to all Customer (capacity 
``C'') orders in XSPBX with a premium price of $0.25 to $0.75 and 
assesses a fee of $0.30 per contract;
    <bullet> Adopts fee code N1, appended to all Clearing Trading 
Permit Holder (``TPH'') (capacity ``F''), Non-Clearing TPH Affiliates 
(capacity ``L''),\5\ Broker-Dealer (capacity ``B''), Joint Back-Office 
(capacity ``J''), Non-TPH Market-Maker (capacity ``N''), and 
Professional (capacity ``U'') \6\ (collectively, ``Non-Customer, Non-
Market-Maker'') orders in XSPBX with a premium price less than $0.04 or 
greater than $0.96 and assesses a fee of $0.10 per contract;
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    \5\ As part of the proposed changes, the Exchange propose to 
append Footnotes 12 and 16 to the Clearing TPH Proprietary capacity 
set forth in the proposed Rate Table for Binary Options. Footnote 12 
provides for certain pricing changes that will apply if the Cboe 
Options trading floor becomes inoperable and the Exchange operates 
in a screen-based only environment during Regular Trading Hours, 
while Footnote 16 provides that Broker-Dealer transaction fees apply 
to broker-dealer orders (orders with ``B'' capacity code), non-
Trading Permit Holder market-maker orders (orders with ``N'' 
capacity code) and certain orders with ``F'' or ``L'' capacity codes 
(i.e., orders from OCC numbers that are not from Cboe Options 
Trading Permit Holders or are not registered with the Exchange).
    \6\ As part of the proposed changes, the Exchange propose to 
append Footnote 16 to the Broker-Dealer and Non-TPH Market Maker 
capacities set forth in the proposed Rate Table for Binary Options.
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    <bullet> Adopts fee code N2, appended to all Non-Customer, Non-
Market Maker orders in XSPBX with a premium price of $0.04 to $0.09 or 
$0.91 to $0.96 and assesses a fee of $0.15 per contract;
    <bullet> Adopts fee code N3, appended to all Non-Customer, Non-
Market Maker orders in XSPBX with a premium price of $0.10 to $0.24 or 
$0.76 to $0.90 and assesses a fee of $0.25 per contract;

[[Page 54771]]

    <bullet> Adopts fee code N4, appended to all Non-Customer, Non-
Market Maker orders in XSPBX with a premium price of $0.25 to $0.75 and 
assesses a fee of $0.35 per contract;
    <bullet> Adopts fee code H1, appended to all electronic Cboe 
Options Market-Maker/Designated Primary Market-Maker (``DPM'')/Lead 
Market-Maker (``LMM'') (``Market-Maker'') (capacity ``M'') orders in 
XSPBX taking liquidity, with a premium price less than $0.04 or greater 
than $0.96 and assesses a fee of $0.10 per contract;
    <bullet> Adopts fee code H2, appended to all electronic Market-
Maker (capacity ``M'') orders in XSPBX taking liquidity, with a premium 
price of $0.04 to $0.09 or $0.91 to $0.96 and assesses a fee of $0.15 
per contract;
    <bullet> Adopts fee code H3, appended to all electronic Market-
Maker (capacity ``M'') orders in XSPBX taking liquidity, with a premium 
price of $0.10 to $0.24 or $0.76 to $0.90 and assesses a fee of $0.25 
per contract;
    <bullet> Adopts fee code H4, appended to all electronic Market-
Maker (capacity ``M'') orders in XSPBX taking liquidity, with a premium 
price of $0.25 to $0.75 and assesses a fee of $0.35 per contract;
    <bullet> Adopts fee code HA, appended to all electronic Market-
Maker (capacity ``M'') orders in XSPBX adding liquidity, and assesses a 
fee of $0.05 per contract; and
    <bullet> Adopts fee code HM, appended to all manual Market-Maker 
(capacity ``M'') orders in XSPBX and assesses a fee of $0.15 per 
contract.
    The Exchange also proposes to adopt and append to fee tables as 
applicable and needed proposed Footnote 24 (currently marked as 
Reserved), which provides that XSPBX options are excluded from the 
following programs: Liquidity Provider Sliding Scale, Liquidity 
Provider Sliding Scale Adjustment Table, Volume Incentive Program, 
Break-Up Credits, Affiliate Volume Plan, Marketing Fee, Clearing 
Trading Permit Holder Fee Cap, Customer Large Trade Discount, Floor 
Broker Sliding Scale Rebate Program, Floor Broker Sliding Scale 
Supplemental Rebate Program, Order Router Subsidy Program, and Complex 
Order Router Subsidy Program.
    First, the Exchange proposes to exclude XSPBX options from the 
Liquidity Provider Sliding Scale, which offers credits on Market-Maker 
orders where a Market-Maker achieves certain volume thresholds based on 
total national Market-Maker volume in all underlying symbols, excluding 
Underlying Symbol List A, DJX, CBTX, MBTX, MGTN, MRUT, NANOS, SPEQX, 
SPESG, XSP and FLEX Micros during the calendar month. Specifically, the 
proposed rule change updates the Liquidity Provider Sliding Scale table 
to provide that volume thresholds are based on total national Market-
Maker volume in all underlying symbols excluding Underlying Symbol List 
A, DJX, CBTX, MBTX, MGTN, MRUT, NANOS, SPEQX, SPESG, XSP, XSPBX, and 
FLEX Micros during the calendar month, and that it applies in all 
underlying symbols excluding Underlying Symbol List A, DJX, CBTX, MBTX, 
MGTN, MRUT, NANOS, SPEQX, SPESG, XSP, XSPBX, and FLEX Micros. The 
proposed rule change also updates Footnote 10 (appended to the 
Liquidity Provider Sliding Scale) to provide that the Liquidity 
Provider Sliding Scale applies to Liquidity Provider (Exchange Market-
Maker, DPM and LMM) transaction fees in all products except (1) 
Underlying Symbol List A, DJX, CBTX, MBTX, MGTN, MRUT, NANOS, SPEQX, 
SPESG, XSP, XSPBX, and FLEX Micros, (2) volume executed in open outcry, 
(3) volume executed via AIM Responses; and (4) volume executed via 
Market-Maker Simple AIM Contra orders in equity, ETF and ETN products.
    The proposed rule change also updates Footnote 44 (appended to the 
Liquidity Provider Sliding Scale Adjustment Table) to exclude XSPBX 
volume from the program by providing (in relevant part) that the Make 
Rate under the Liquidity Provider Sliding Scale Adjustment Table be 
derived from a Liquidity Provider's electronic volume the previous 
month in all symbols excluding Underlying Symbol List A, DJX, CBTX, 
MBTX, MGTN, SPEQX, SPESG, XSPBX, and XSP.
    The proposed rule change updates the Volume Incentive Program 
(``VIP'') table to exclude XSPBX volume from the VIP, which currently 
offers a per contract credit for certain percentage threshold levels of 
monthly Customer volume in all underlying symbols, excluding Underlying 
Symbol List A, Sector Indexes, DJX, CBTX, MBTX, MGTN, MRUT, NANOS, 
SPEQX, SPESG, XSP, and FLEX Micros. The proposed rule change also 
amends Footnote 36 (appended to the VIP table) to reflect the proposed 
exclusion of XSPBX from the VIP by providing (in relevant part) that: 
the Exchange shall credit each TPH the per contract amount resulting 
from each public customer (``C'' capacity code) order transmitted by 
that TPH which is executed electronically on the Exchange in all 
underlying symbols excluding Underlying Symbol List A, Sector Indexes, 
DJX, CBTX, MBTX, MGTN, MRUT, NANOS, SPEQX, SPESG, XSP, XSPBX, and FLEX 
Micros, QCC trades, public customer to public customer electronic 
complex order executions, and executions related to contracts that are 
routed to one or more exchanges in connection with the Options Order 
Protection and Locked/Crossed Market Plan referenced in Rule 5.67, 
provided the TPH meets certain percentage thresholds in a month as 
described in the Volume Incentive Program (VIP) table; the percentage 
thresholds are calculated based on the percentage of national customer 
volume in all underlying symbols excluding Underlying Symbol List A, 
Sector Indexes, DJX, CBTX, MBTX, MGTN, MRUT, NANOS, SPEQX, SPESG, XSP, 
XSPBX, and FLEX Micros entered and executed over the course of the 
month; and in the event of a Cboe Options System outage or other 
interruption of electronic trading on Cboe Options, the Exchange will 
adjust the national customer volume in all underlying symbols excluding 
Underlying Symbol List A, Sector Indexes, DJX, CBTX, MBTX, MGTN, MRUT, 
NANOS, SPEQX, SPESG, XSP, XSPBX, and FLEX Micros for the entire trading 
day. The Exchange also proposes to update the related Affiliate Volume 
Plan Program (``AVP'') table to append proposed Footnote 24 and exclude 
XSPBX from the program.
    The proposed rule change excludes XSPBX options from the list of 
products eligible to receive Break-Up Credits in orders executed in 
AIM, SAM, FLEX AIM, and FLEX SAM, by amending the Break-Up Credits 
table to exclude XSPBX along with the products currently excluded--
Underlying Symbol List A, Sector Indexes, DJX, CBTX, MBTX, MGTN, MRUT, 
NANOS, SPEQX, SPESG, XSP, XSPBX, and FLEX Micros.
    The Exchange proposes to exclude XSPBX options from the Marketing 
Fee Program by updating the Marketing Fee table to provide that the 
marketing fee will be assessed on transactions of Market-Makers 
(including DPMs and LMMs), resulting from customer orders at the per 
contract rate provided above on all classes of equity options, options 
on ETFs, options on ETNs and index options, except that the marketing 
fee shall not apply to Sector Indexes, DJX, CBTX, MBTX, MGTN, MRUT, 
XSP, XSPBX, SPEQX, SPESG, NANOS, FLEX Micros or Underlying Symbol List 
A. The Exchange notes that, in this way, XSPBX options will be treated 
as most of the Exchange's other exclusively listed products that are 
currently excluded from the Marketing Fee Program.
    The Exchange proposes to exclude XSPBX options from the Floor 
Broker

[[Page 54772]]

Sliding Scale Rebate Program and Floor Broker Sliding Scale 
Supplemental Rebate Program, which offers rebates for Firm Facilitated 
and non-Firm Facilitated orders that correspond to certain volume tiers 
and is designed to incentivize order flow in multiply listed options to 
the Exchange's trading floor. The Exchange proposes to update the Floor 
Broker Sliding Scale Rebate Program and Floor Broker Sliding Scale 
Supplemental Rebate Program to provide that the Floor Broker Sliding 
Scale Rebate Program and Floor Broker Sliding Scale Supplemental Rebate 
Program applies to all products except Underlying Symbol List A, Sector 
Indexes, DJX, CBTX, MBTX, MGTN, MRUT, NANOS, SPEQX, SPESG, XSP, XSPBX, 
and FLEX Micros.
    The Exchange next proposes to exclude XSPBX options from 
eligibility for the Order Router Subsidy (``ORS'') and Complex Order 
Router Subsidy (``CORS'') Programs, in which Participating TPHs or 
Participating Non-Cboe TPHs may receive a payment from the Exchange for 
every executed contract routed to the Exchange through their system in 
certain classes. Specifically, the proposed rule change updates the 
ORS/CORS Program tables to provide that ORS/CORS participants whose 
total aggregate non-customer ORS and CORS volume is greater than 0.25% 
of the total national volume (excluding volume in options classes 
included in Underlying Symbol List A, Sector Indexes, DJX, CBTX, MBTX, 
MGTN, MRUT, NANOS, SPEQX, SPESG, XSP, XSPBX, or FLEX Micros) will 
receive an additional payment for all executed contracts exceeding that 
threshold during a calendar month, and updates Footnotes 29 and 30 
(appended to the ORS/CORS Program tables) to accordingly provide that 
Cboe Options does not make payments under the program with respect to 
executed contracts in options classes included in Underlying Symbols 
List A, Sector Indexes, DJX, CBTX, MBTX, MGTN, MRUT, NANOS, SPEQX, 
SPESG, XSP, XSPBX, or FLEX Micros.
    The Exchange also proposes to exclude Non-Customer complex orders 
in XSPBX options from the Complex Surcharge by amending Footnote 35 
(appended to the Complex Surcharge) to provide that the Complex 
Surcharge applies per contract per side surcharge for noncustomer 
complex order executions that remove liquidity from the Complex Order 
Book (``COB'') and auction responses in the Complex Order Auction 
(``COA'') and AIM in all classes except CBTX, MBTX, MGTN, MRUT, NANOS, 
SPEQX, XSP, XSPBX, FLEX Micros, Sector Indexes and Underlying Symbol 
List A.
    The Exchange also proposes to exclude Firm (i.e., Clearing Trading 
Permit Holders (capacity ``F'') and Non-Clearing Trading Permit Holder 
Affiliates (capacity ``L'')) transactions in XSPBX from the Clearing 
TPH Fee Cap. Specifically, it amends footnote 22 (appended to the 
Clearing TPH Fee Cap table) to provide that all non-facilitation 
business executed in AIM or open outcry, or as a QCC or FLEX 
transaction, transaction fees for Clearing TPH Proprietary and/or their 
Non-TPH Affiliates in all products except CBTX, MBTX, MGTN, MRUT, 
NANOS, XSP, XSPBX, SPEQX, SPESG, FLEX Micros, Sector Indexes and 
Underlying Symbol List A, in the aggregate, are capped at $250,000 per 
month per Clearing TPH. The proposed rule change additionally updates 
Footnote 11 (which is also appended to the Clearing TPH Fee Cap table) 
to provide that the Clearing TPH Fee Cap in all products except CBTX, 
MBTX, MGTN, MRUT, NANOS, XSP, XSPBX, SPEQX, SPESG, FLEX Micros, 
Underlying Symbol List A and Sector Indexes (the ``Fee Cap''), the Cboe 
Options Proprietary Products Sliding Scale for Clearing TPH Proprietary 
Orders, and the Clearing TPH Proprietary VIX Sliding Scale apply to (i) 
Clearing TPH proprietary orders (``F'' capacity code), and (ii) orders 
of Non-TPH Affiliates of a Clearing TPH.
    The Exchange also proposes to exclude XSPBX volume from the 
Customer Large Trade Discount, which provides a discount in the form of 
a cap on transaction fees for certain Customer executions.
    Finally, the Exchange also proposes to amend Footnote 6 which 
provides that, in the event of a Cboe Options System outage or other 
interruption of electronic trading on Cboe Options that lasts longer 
than 60 minutes, the Exchange will adjust the national volume in all 
underlying symbols excluding Underlying Symbol List A, Sector Indexes, 
CBTX, MBTX, MGTN, MRUT, NANOS, DJX, SPEQX, SPESG, XSP, and FLEX Micros 
for the entire trading day, to include XSPBX in the list of underlying 
symbols excluded.
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) of the Act,\10\ which 
requires that Exchange rules provide for the equitable allocation of 
reasonable dues, fees, and other charges among its Trading Permit 
Holders and other persons using its facilities.
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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 that the proposed amendments to the Fees 
Schedule in connection with standard transaction rates for XSPBX 
transactions are reasonable, equitable and not unfairly discriminatory, 
and reflect the unique economic and structural characteristics of 
binary options. Unlike standard options, where premiums can range from 
near zero to multiples of the underlying price, binary options have a 
fixed $1.00 maximum payout and a premium that is inherently bounded 
between $0.00 and $1.00, with the premium directly reflecting the 
market's assessed probability that the binary outcome will occur. The 
Exchange designed the proposed fee structure to account for this 
distinct economic profile. First, the Exchange believes the tiered fee 
structure is reasonable because it keeps low-probability contracts 
economically viable. By assessing lower fees on contracts at the 
extreme ends of the premium range (i.e., less than $0.04 or greater 
than $0.96), the Exchange believes the proposed fees will not deter 
participants from trading these contracts solely due to fees, thereby 
supporting a continuous and liquid market across the full probability 
spectrum. Related, the Exchange believes it is reasonable and 
appropriate that fees are highest for contracts with premiums in the 
$0.25 to $0.75 range, where the binary outcome is most

[[Page 54773]]

uncertain, trading interest is greatest, and the economic value of the 
contract to both buyer and seller is most significant.
    The Exchange believes the proposal creates a fee structure that 
treats the two sides of a binary contract symmetrically. For example, a 
contract trading at $0.30 and a contract trading at $0.70 reflect 
mirror-image risk profiles and are assessed the same fee under the 
proposed structure. The Exchange believes this symmetrical treatment is 
equitable and not unfairly discriminatory because it avoids creating 
artificial incentives to favor one side of a binary contract over the 
other based solely on fee considerations. The Exchange further believes 
the premium-based fee structure calibrated more accurately reflects the 
true economics of each transaction and is therefore a more appropriate 
and equitable basis for assessing fees than a flat notional-based 
charge.
    Additionally, the Exchange believes it is reasonable to charge 
different fee amounts to different user types in the manner proposed 
because the proposed fees are consistent with the price differentiation 
that exists today for other products. The Exchange believes the 
proposed fees are not unfairly discriminatory because they apply 
uniformly within each participant category, as applicable.
    The Exchange believes the proposed Customer fees are reasonable 
because they are set at levels designed to encourage Customer 
participation in XSPBX, which benefits all market participants by 
contributing to a liquid and competitive marketplace. The tiered fee 
structure, which scales with premium price, reflects the varying 
economic value and risk associated with transactions at different 
premium levels. Options with premiums at the extremes of the pricing 
range (i.e., less than $0.04 or greater than $0.96) are assessed a 
lower fee of $0.04 per contract, as these represent near-zero or near-
certain outcome contracts where the economic value to the Customer is 
relatively limited. Fees increase as the premium approaches $0.25 to 
$0.75, where the outcome is most uncertain and the economic value of 
the contract is greatest, with a maximum fee of $0.30 per contract. The 
Exchange believes this tiered approach is equitable and not unfairly 
discriminatory because it applies uniformly to all Customers trading 
XSPBX and reflects the relative value of transactions at each premium 
tier. The Exchange also believes that it is equitable and not unfairly 
discriminatory to assess lower fees to Customers as compared to other 
market participants because Customer order flow enhances liquidity on 
the Exchange for the benefit of all market participants. Specifically, 
customer liquidity benefits all market participants by providing more 
trading opportunities, which attracts Market-Makers. An increase in the 
activity of these market participants in turn facilitates tighter 
spreads, which may cause an additional corresponding increase in order 
flow from other market participants. The fees offered to customers are 
intended to attract more customer trading volume to the Exchange. 
Moreover, the options industry has a long history of providing 
preferential pricing to Customers, and the Exchange's current Fees 
Schedule currently does so in many places, as do the fees structures of 
many other exchanges. Finally, all fee amounts listed as applying to 
Customers will be applied equally to all Customers (meaning that all 
Customers will be assessed the same amount).
    The Exchange believes the proposed Non-Customer, Non-Market-Maker 
fees are reasonable and equitably allocated. These participants, 
including Clearing TPHs, Non-Clearing TPH Affiliates, Broker-Dealers, 
Joint-Back Office participants, Non-TPH Market-Makers, and 
Professionals generally trade for their own accounts or in a 
professional capacity and are assessed modestly higher fees than 
Customers, consistent with the Exchange's longstanding practice of 
assessing lower fees on Customers to encourage retail participation. 
The tiered structure mirrors that of the Customer fees and applies 
uniformly to all Non-Customer, Non-Market-Maker participants, ranging 
from $0.10 per contract at the extreme premium tier to $0.35 per 
contract at the mid-range premium tier.
    The Exchange also believes the proposed electronic Market-Maker 
taker fees, which are commensurate with those assessed to other Non-
Customer participants, are reasonable because Market-Makers that remove 
liquidity from the Exchange contribute to price discovery and execution 
quality in a similar way as Non-Customer, Non-Market Maker 
participants.
    The Exchange believes that it is equitable and not unfairly 
discriminatory to assess lower fees to Market-Makers orders in XSPBX 
that are executed electronically and add liquidity because these lower 
fees are intended to incent Market-Makers to trade more on the 
Exchange, which benefits all participants by contributing to tighter 
spreads and a more competitive marketplace. The Exchange believes the 
proposed fee for manual Market-Maker orders in XSPBX is reasonable as 
it reflects the different cost structure associated with manual order 
handling and is consistent with how the Exchange treats manual Market-
Maker activity in other products.
    The Exchange believes the proposed adoption of Footnote 24, which 
excludes XSPBX from certain Exchange fee programs and incentives, is 
reasonable, equitably allocated, and not unfairly discriminatory. The 
Exchange believes these exclusions are reasonable because XSPBX is a 
newly listed product with a unique structure. The Exchange believes it 
is appropriate to assess straightforward transaction fees for XSPBX 
upon initial listing and notes that similar exclusions apply to other 
proprietary products on the Exchange. Moreover, the Exchange notes that 
the proposed rule change does not alter any of the existing programs, 
but instead, merely proposes not to include transactions in XSPBX 
options in those programs.
    The Exchange believes that excluding XSPBX options transactions 
from certain fees programs is equitable and not unfairly discriminatory 
because the programs will equally not apply to, or exclude in the same 
manner, all market participants' orders in XSPBX options. The Exchange 
notes that the proposed rule change does not alter any of the existing 
program rates or volume calculations, but instead, merely proposes not 
to include transactions in XSPBX options in those programs and volume 
calculations. Moreover, the Exchange believes it is reasonable to 
exclude XSPBX options from the Complex Surcharge because the proposed 
surcharge exclusions will provide consistency between the fees assessed 
for orders in other proprietary products, including XSP and Underlying 
Symbol List A.
    The Exchange believes the proposed amendment to Footnote 6, which 
adds XSPBX to the list of underlying symbols excluded from the national 
volume adjustment applied in the event of a Cboe Options System outage 
or other interruption of electronic trading lasting longer than 60 
minutes, is reasonable, equitably allocated, and not unfairly 
discriminatory. Further, the Exchange believes it is appropriate to 
similarly exclude XSPBX given that it is a binary options product with 
a distinct structure and trading profile that differs from standard 
equity and index options. The proposed exclusion applies uniformly to 
all participants trading XSPBX and is therefore not unfairly 
discriminatory.
    The Exchange acknowledges that XSPBX is a proprietary product 
available exclusively on the Exchange.

[[Page 54774]]

However, the Exchange notes that market participants retain the ability 
to migrate activity to economically similar products available at other 
venues,\11\ and that the proposed rates must therefore be set at levels 
that reflect the value of trading these products, not at levels that 
would drive participants toward substitutes.
---------------------------------------------------------------------------

    \11\ The Exchange notes that binary options similar to XSPBX are 
available in the OTC market and on other platforms.
---------------------------------------------------------------------------

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 Exchange does not 
believe the proposed rule change will impose any burden on intramarket 
competition that is not necessary or appropriate in furtherance of the 
purposes of the Act. The proposed standard transaction fees for XSPBX 
apply uniformly to all participants within each capacity and, with 
respect to Market-Makers by execution method and by whether the order 
adds or removes liquidity, and are structured consistently across those 
categories in a manner that reflects each participant's role in the 
marketplace, as described above. The exclusion of XSPBX from certain 
fee programs, surcharge, and incentives similarly applies uniformly to 
all participants trading XSPBX.
    The Exchange does not believe that the proposed rule change will 
impose any burden on intermarket competition that is not necessary or 
appropriate in furtherance of the purposes of the Act because the 
proposed fees assessed apply to Exchange proprietary products, which 
are traded exclusively on the Exchange. As stated above, the Exchange 
notes that market participants retain the ability to migrate activity 
to economically similar products available at other venues.

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 \12\ and paragraph (f) of Rule 19b-4 \13\ 
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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    \12\ 15 U.S.C. 78s(b)(3)(A).
    \13\ 17 CFR 240.19b-4(f).
---------------------------------------------------------------------------

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#85f7f0e9e0a8e6eae8e8e0ebf1f6c5f6e0e6abe2eaf3"><span class="__cf_email__" data-cfemail="0371766f662e606c6e6e666d7770437066602d646c75">[email&#160;protected]</span></a>. Please include 
file number SR-CBOE-2026-071 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-CBOE-2026-071. 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-CBOE-2026-071 and should be submitted on 
or before September 14, 2026.

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\14\
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    \14\ 17 CFR 200.30-3(a)(12).
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Vanessa A. Countryman,
Secretary.
[FR Doc. 2026-17203 Filed 8-21-26; 8:45 am]
BILLING CODE 8011-01-P


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