[Federal Register Volume 89, Number 111 (Friday, June 7, 2024)]
[Notices]
[Pages 48695-48697]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-12465]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-100260; File No. SR-CboeEDGX-2024-031]


Self-Regulatory Organizations; Cboe EDGX Exchange, Inc.; Notice 
of Filing and Immediate Effectiveness of a Proposed Rule Change To 
Delay Implementation of a New Connectivity Offering Through Dedicated 
Cores

June 3, 2024.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given 
that on May 31, 2024, Cboe EDGX Exchange, Inc. (the ``Exchange'' or 
``EDGX'') filed with the Securities and Exchange Commission (the 
``Commission'') the proposed rule change as described in Items I and II 
below, which Items have been prepared by the Exchange. The Exchange 
filed the proposal as a ``non-controversial'' proposed rule change 
pursuant to Section 19(b)(3)(A)(iii) of the Act \3\ and Rule 19b-
4(f)(6) thereunder.\4\ 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.
    \3\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \4\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance 
of the Proposed Rule Change

    Cboe EDGX Exchange, Inc. (the ``Exchange'' or ``EDGX'') proposes to 
delay implementation of a new connectivity offering.
    The text of the proposed rule change is also available on the 
Exchange's website (http://markets.cboe.com/us/options/regulation/rule_filings/edgx/), at the Exchange's Office of the Secretary, and at 
the Commission's Public Reference Room.

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 Dedicated 
Cores. The Exchange previously filed SR-CboeEDGX-2024-026 to establish 
Dedicated Cores effective June 3, 2024.\5\
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    \5\ See Securities Exchange Act Release No. 97658 (May 20, 
2024), 89 FR 45930 (May 24, 2024) (SR-CboeEDGX-2024-026) (Notice of 
Filing and Immediate Effectiveness of Proposed Rule Change To 
Introduce a New Connectivity Offering Through Dedicated Cores) 
(``SR-CboeEDGX-2024-026'').
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    By way of background, SR-CboeEDGX-2024-026 proposed to introduce a 
new connectivity offering relating to the use of Dedicated Cores. 
Historically, Central Processing Units (``CPU Cores'') have been shared 
by logical order entry ports (i.e., multiple logical ports from 
multiple firms may connect to a single CPU Core). The introduction of 
Dedicated Cores would allow Users \6\ to assign a single Binary Order 
Entry (``BOE'') logical order entry port \7\ to a single dedicated CPU 
Core (``Dedicated Core'').\8\ Use of Dedicated Cores can provide 
reduced latency, enhanced throughput, and improved performance since a 
firm using a Dedicated Core is utilizing the full processing power of a 
CPU Core instead of sharing that power with other firms. This offering 
is completely voluntary and will be available to all Users.\9\ Users 
will also continue to have the option to utilize BOE logical order 
entry ports on shared CPU Cores as they do today, either in lieu of, or 
in addition to, their use of Dedicated Core(s). As such, Users will be 
able to operate across a mix of shared and dedicated CPU Cores which 
the Exchange believes provides additional risk and capacity

[[Page 48696]]

management, especially during times of market volatility and high 
message traffic. Further, Dedicated Cores are not required nor 
necessary to participate on the Exchange and as such Users may opt not 
to use Dedicated Cores at all.
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    \6\ A User may be either a Member or Sponsored Participant. The 
term ``Member'' shall mean any registered broker or dealer that has 
been admitted to membership in the Exchange, limited liability 
company or other organization which is a registered broker or dealer 
pursuant to Section 15 of the Act, and which has been approved by 
the Exchange. A Sponsored Participant may be a Member or non-Member 
of the Exchange whose direct electronic access to the Exchange is 
authorized by a Sponsoring Member subject to certain conditions. See 
Exchange Rule 11.3.
    \7\ Users may currently connect to the Exchange using a logical 
port available through an application programming interface 
(``API''), such as the Binary Order Entry (``BOE'') protocol. A BOE 
logical order entry port is used for order entry.
    \8\ The Exchange notes that firms will not have physical access 
to their Dedicated Core and thus cannot make any modifications to 
the Dedicated Core or server. All Dedicated Cores (including servers 
used for this service) are owned and operated by the Exchange.
    \9\ The Exchange intends to submit a separate rule filing to 
adopt monthly fees related to the use of Dedicated Cores.
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    SR-CboeEDGX-2024-026 stated that the rule change would be 
implemented on June 3, 2024. At this time, the Exchange proposes to 
delay the implementation of SR-CboeEDGX-2023-026 [sic] to on or after 
July 1, 2024 to permit the Exchange additional time to implement 
Dedicated Cores in the Exchange's data center. The Exchange would issue 
a Trade Desk Notice announcing the exact implementation date to members 
and member organizations.
2. Statutory Basis
    The Exchange believes that its proposal is consistent with Section 
6(b) of the Act,\10\ in general, and furthers the objectives of Section 
6(b)(5) of the Act,\11\ 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. The Exchange's proposal to delay the implementation of SR-
CboeEDGX-2024-026 to on or after July 1, 2024 is consistent with the 
Act and the protection of investors and the general public as it will 
permit the Exchange additional time to ensure the Exchange's data 
center can accommodate the proposed Dedicated Cores. As noted, the 
Exchange would issue a Trade Desk Notice announcing the exact 
implementation date to members and member organizations.
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    \10\ 15 U.S.C. 78f(b).
    \11\ 15 U.S.C. 78f(b)(5).
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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. The Exchange's proposal to delay the implementation of SR-
CboeEDGX-2024-026 to on or after July 1, 2024 does not impose any 
burden on competition as it will permit the Exchange additional time to 
implement Dedicated Cores.

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

    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 prior to 30 days from the date on which it was filed, 
or such shorter time as the Commission may designate, if consistent 
with the protection of investors and the public interest, the proposed 
rule change has become effective pursuant to Section 19(b)(3)(A)(iii) 
of the Act \12\ and Rule 19b-4(f)(6) thereunder.\13\
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    \12\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \13\ 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, along 
with a brief description and text of 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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    A proposed rule change filed under Rule 19b-4(f)(6) \14\ normally 
does not become operative prior to 30 days after the date of the 
filing. However, pursuant to Rule 19b-4(f)(6)(iii),\15\ the Commission 
may designate a shorter time if such action is consistent with the 
protection of investors and the public interest.
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    \14\ 17 CFR 240.19b-4(f)(6).
    \15\ 17 CFR 240.19b-4(f)(6)(iii).
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    The Exchange has asked the Commission to waive the 30-day operative 
delay so that the proposal may become operative immediately upon 
filing. Waiver of the operative delay would allow the Exchange to 
immediately delay the implementation of SR-CboeEDGX-2024-026 to 
establish Dedicated Cores and provide the Exchange additional time to 
ensure readiness at the Exchange's data center for implementation of 
Dedicated Cores on or after July 1, 2024. The Commission believes that 
the proposed rule change presents no novel legal or regulatory issues, 
and that waiver of the 30-day operative delay is consistent with the 
protection of investors and the public interest. Accordingly, the 
Commission hereby waives the 30-day operative delay and designates the 
proposed rule change operative upon filing.\16\
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    \16\ For purposes only of waiving the 30-day operative delay, 
the Commission has also considered the proposed rule's impact on 
efficiency, competition, and capital formation. See 15 U.S.C. 
78c(f).
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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 under 
Section 19(b)(2)(B) of the Act \17\ to determine whether the proposed 
rule change should be approved or disapproved.
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    \17\ 15 U.S.C. 78s(b)(2)(B).
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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

     Use the Commission's internet comment form (https://www.sec.gov/rules/sro.shtml); or
     Send an email to [email protected]. Please include 
file number SR-CboeEDGX-2024-031 on the subject line.

Paper Comments

     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-CboeEDGX-2024-031. 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 (https://www.sec.gov/rules/sro.shtml). Copies of the submission, all subsequent amendments, all 
written statements with respect to the proposed rule change that are 
filed with the Commission, and all written communications relating to 
the proposed rule change between the Commission and any person, other 
than those that may be withheld from the public in accordance with the 
provisions of 5 U.S.C. 552, will be available for website viewing and

[[Page 48697]]

printing in the Commission's Public Reference Room, 100 F Street NE, 
Washington, DC 20549, on official business days between the hours of 10 
a.m. and 3 p.m. Copies of the filing also 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-CboeEDGX-2024-031 and should 
be submitted on or before June 28, 2024.

    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), (59).
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Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2024-12465 Filed 6-6-24; 8:45 am]
BILLING CODE 8011-01-P