No-action position with respect to Part 43 and Part 45 reporting, as well as related sections of Parts 38 and 39, for certain binary and variable payout event contracts.

Summary: No-action position with respect to Part 43 and Part 45 reporting, as well as related sections of Parts 38 and 39, for certain binary and variable payout event contracts.

CFTC Letter No. 26-14 No-Action May 13, 2026

U.S. COMMODITY FUTURES TRADING COMMISSION

Three Lafayette Centre, 1155 21st Street, NW, Washington, DC 20581

www.cftc.gov

Division of Market Oversight

Division of Clearing and Risk

Re:

Requests for No-Action Positions with Respect to Commission Regulations 38.8(b), 38.10,

38.951 (only to the extent it requires compliance with Part 45 of the Commission’s

Regulations), 39.20(b)(2), and Parts 43 and 45, for Certain Fully Collateralized Event

Contracts

I.

Introduction

Since 2016, the Division of Market Oversight (“DMO”) and the Division of Clearing and

Risk (“DCR,” and, together with DMO, the “Divisions”) have received numerous requests1 from

designated contract markets (“DCMs”) and derivatives clearing organizations (“DCOs”) seeking

no-action positions with respect to swap reporting requirements applicable to fully collateralized

binary payout contracts and similar variable payout contracts based on the occurrence or non-

occurrence of the events that are the subjects of the contracts.2 Each of the requesting firms has

sought a no-action position stating that the Divisions will not recommend the Commission

commence an enforcement action against the requesting firm for failure to report swap data to a

swap data repository as required by the Commission’s swap reporting regulations,3 on the

condition that the requesting firm will report transaction and market data in a manner similar to

that required for DCMs for futures and options.4 Certain of the requests the Divisions have

1 Specifically, the Divisions have received such requests from the North American Derivatives Exchange, Inc. d/b/a

Crypto.com; FMX Futures Exchange, L.P., formerly Cantor Futures Exchange, L.P.; C.X

the

condition that the requesting firm will report transaction and market data in a manner similar to

that required for DCMs for futures and options.4 Certain of the requests the Divisions have

1 Specifically, the Divisions have received such requests from the North American Derivatives Exchange, Inc. d/b/a

Crypto.com; FMX Futures Exchange, L.P., formerly Cantor Futures Exchange, L.P.; C.X. Clearinghouse, L.P.,

formerly Cantor Clearinghouse, L.P.; KalshiEX LLC; Rothera Exchange and Clearing LLC, formerly known as

LedgerX LLC; ForecastEx LLC; Kalshi Klear LLC; Chicago Mercantile Exchange Inc.; Railbird Exchange, LLC; QC

Clearing LLC d/b/a Polymarket Clearing; QCX LLC d/b/a Polymarket US; Electron Exchange DCM, LLC; Electron

Exchange DCO, LLC; Gemini Titan, LLC; Aristotle Exchange DCM, Inc.; Aristotle Exchange DCO, Inc.; Bitnomial

Exchange, LLC; Bitnomial Clearinghouse, LLC; and Gemini Olympus, LLC.

2 For purposes of this letter, the Divisions use the term “event contracts” to refer to such fully collateralized binary

options and similar variable payout contracts based on the occurrence or non-occurrence of the events that are the

subjects of the contracts.

3 Specifically, requesting firms have sought no-action positions with respect to Regulations 38.8(b), 38.10, 38.951

(only to the extent it requires compliance with Part 45 of the Commission’s Regulations), 39.20(b)(2), and Parts 43

and 45.

4 Specifically, the previously granted no-action positions includes conditions requiring that beneficiaries will report

data required by regulation 16.02. Other provisions in Parts 15, 16, 17, 18, and 21 continue to apply to certain contracts

subject to these previously granted no-action positions as well. See, e.g., 17 C.F.R. § 16.01 (requiring reporting and

publication of “daily market data on futures, swaps and options thereon”).

tion positions includes conditions requiring that beneficiaries will report

data required by regulation 16.02. Other provisions in Parts 15, 16, 17, 18, and 21 continue to apply to certain contracts

subject to these previously granted no-action positions as well. See, e.g., 17 C.F.R. § 16.01 (requiring reporting and

publication of “daily market data on futures, swaps and options thereon”).

2

received also seek to modify previously granted no-action positions to account for subsequent

modifications to orders of designation for DCMs or orders of registration for DCOs.5 The

Divisions have granted eighteen of these requests to date (the “Event Contract Reporting No-

Action Letters”).6

These requests have followed a proliferating number of applications for DCM designation

orders from entities with a stated interest in offering “event contracts” for trading. It is staff’s

experience that entities seeking DCM designation and seeking to list event contracts may wish to

receive a no-action position similar to no-action positions previously provided to DCMs listing

event contracts. The Divisions anticipate receiving a significant number of similar requests in the

future.

Continuing to address these requests serially and ad hoc raises several concerns, which the

Divisions discuss below. Due to the high volume of requests received to date and the anticipated

receipt of additional requests, the Divisions believe that the most efficient and effective way to

address the concerns raised by these requests is to issue a no-action position setting out the

applicable conditions to apply consistently across all DCMs and DCOs that obtain a no-action

position. To ensure uniformity going forward, this letter applies to all beneficiaries of previously-

issued no-action letters, and applies on a going-forward basis to DCMs and DCOs listing for trade

fully collateralized binary payout contracts and variable payout contracts subject to the no-action

position set out in this letter

ly consistently across all DCMs and DCOs that obtain a no-action

position. To ensure uniformity going forward, this letter applies to all beneficiaries of previously-

issued no-action letters, and applies on a going-forward basis to DCMs and DCOs listing for trade

fully collateralized binary payout contracts and variable payout contracts subject to the no-action

position set out in this letter. In addition, the Divisions understand that the Commission may

address the reporting of event contracts more broadly in a proposed rulemaking. The no-action

position set out in this letter will be effective until a final rule is adopted by the Commission

addressing this matter.

II.

Background

The Commodity Exchange Act (“CEA”) generally requires that all swap transactions be

5 See, e.g., CFTC Letter No. 24-15 (Oct. 4, 2024), available at https://www.cftc.gov/csl/24-15/download; CFTC Letter

No. 25-02 (Jan. 31, 2025), available at https://www.cftc.gov/csl/25-02/download.

6 See CFTC Letter No. 17-31 (June 30, 2017), available at https://www.cftc.gov/csl/17-31/download; CFTC Letter

No. 17-32 (June 30, 2017), available at https://www.cftc.gov/csl/17-32/download; CFTC Letter No. 21-11 (Apr. 22,

2021), available at https://www.cftc.gov/csl/21-11/download; CFTC Letter No. 24-09 (July 12, 2024), available at

https://www.cftc.gov/csl/24-09/download;

CFTC

Letter

No.

24-12

(Sept.

3,

2024),

available

at

https://www.cftc.gov/csl/24-12/download;

CFTC

Letter

No.

24-15

(Oct.

4,

2024),

available

at

https://www.cftc.gov/csl/24-15/download;

CFTC

Letter

No.

25-02

(Jan.

31,

2025),

available

at

https://www.cftc.gov/csl/25-02/download;

CFTC

Letter

No.

25-23

(Jul.

22,

2025),

available

at

https://www.cftc.gov/csl/25-23/download;

CFTC

Letter

No.

25-26

(Aug.

7,

2025),

available

at

https://www.cftc.gov/csl/25-26/download;

CFTC

Letter

No.

25-28

(Sept.

3,

2025),

available

at

https://www.cftc.gov/csl/25-28/download;

CFTC

Letter

No.

25-35

(Sept

),

available

at

https://www.cftc.gov/csl/25-02/download;

CFTC

Letter

No.

25-23

(Jul.

22,

2025),

available

at

https://www.cftc.gov/csl/25-23/download;

CFTC

Letter

No.

25-26

(Aug.

7,

2025),

available

at

https://www.cftc.gov/csl/25-26/download;

CFTC

Letter

No.

25-28

(Sept.

3,

2025),

available

at

https://www.cftc.gov/csl/25-28/download;

CFTC

Letter

No.

25-35

(Sept.

30,

2025),

available

at

https://www.cftc.gov/csl/25-35/download;

CFTC

Letter

No.

25-44

(Dec.

11,

2025),

available

at

https://www.cftc.gov/csl/25-44/download;

CFTC

Letter

No.

25-45

(Dec.

11,

2025),

available

at

https://www.cftc.gov/csl/25-45/download;

CFTC

Letter

No.

25-47

(Dec.

11,

2025),

available

at

https://www.cftc.gov/csl/25-47/download;

CFTC

Letter

No.

25-48

(Dec.

11,

2025),

available

at

https://www.cftc.gov/csl/25-48/download;

CFTC

Letter

No.

26-01

(Jan.

8,

2026),

available

at

https://www.cftc.gov/csl/26-01/download;

CFTC

Letter

No.

26-12

(May

1,

2026),

available

at

https://www.cftc.gov/csl/26-12/download; and CFTC Letter No. 26-13 (May 4, 2026), available at

https://www.cftc.gov/csl/26-13/download.

3

reported to a swap data repository (“SDR”).7 The CEA also authorizes the Commission to make

swap transaction and pricing data available to the public in order to enhance price discovery.8 This

includes the authority to require registered entities to publicly disseminate swap transaction data.9

Typically, under the Commission’s real-time swap reporting rules, SDRs perform this

dissemination function.10

Parts 43, 45, and 49 of the Commission’s regulations implement sections 2(a)(13)(G) and

(D).11 These regulations require that certain entities report swap data and swap transaction and

pricing data to SDRs, and require that SDRs, in turn, provide swap data to the Commission and

disseminate swap transaction and pricing data to the public.12 This SDR reporting regime arose

from Title VII of the 2010 Dodd-Frank Act,13 which establ

n’s regulations implement sections 2(a)(13)(G) and

(D).11 These regulations require that certain entities report swap data and swap transaction and

pricing data to SDRs, and require that SDRs, in turn, provide swap data to the Commission and

disseminate swap transaction and pricing data to the public.12 This SDR reporting regime arose

from Title VII of the 2010 Dodd-Frank Act,13 which established a comprehensive new regulatory

framework for swaps and security-based swaps. The Dodd-Frank Act was intended to reduce risk,

increase transparency and promote market integrity within the financial system by, among other

things, creating robust recordkeeping and real-time reporting regimes. As the Commission has

noted, “public dissemination of standardized data should reduce the search costs to the public and

market participants while increasing consolidation of real-time swap transaction and pricing data

and promoting post-trade transparency and price discovery.”14

Separate from the SDR reporting regime for swaps, the Commission has long overseen the

reporting regime for futures and options transactions and positions set out in Parts 15, 16, 17, 18,

19, and 21.15 Whereas swap data reporting is sent to SDRs, which in turn process and provide

swap data to the Commission and process and disseminate swap transaction and pricing data to

the public, futures and options data is generally sent directly to the Commission,16 while certain

market data, including price, volume, and other transaction information, is separately published by

DCMs.17

7 The CEA states that “[e]ach swap (whether cleared or uncleared) shall be reported to a registered swap data

repository.” 7 U.S.C. § 2(a)(13)(G).

8 7 U.S.C. § 2(a)(13)(B).

9 7 U.S.C. § 2(a)(13)(D).

10 See 17 C.F.R. § 43.4.

11 See 17 C.F.R. part 43; 17 C.F.R. part 45; 17 C.F.R. part 49.

12 See, e.g., 17 C.F.R. § 43.1

d other transaction information, is separately published by

DCMs.17

7 The CEA states that “[e]ach swap (whether cleared or uncleared) shall be reported to a registered swap data

repository.” 7 U.S.C. § 2(a)(13)(G).

8 7 U.S.C. § 2(a)(13)(B).

9 7 U.S.C. § 2(a)(13)(D).

10 See 17 C.F.R. § 43.4.

11 See 17 C.F.R. part 43; 17 C.F.R. part 45; 17 C.F.R. part 49.

12 See, e.g., 17 C.F.R. § 43.1. Whereas Part 43 generally concerns reporting and public dissemination of swap

transaction and pricing data, Part 45 concerns reporting of more detailed swap data that is made available to the

Commission, which includes counterparty-identifying information, life-cycle-event data, and valuation, margin, and

collateral data. See, e.g., 17 C.F.R. § 45.4.

13 Public Law 111–203, 124 Stat. 1376 (2010) (herein, the “Dodd-Frank Act”). Pursuant to section 701 of the Dodd-

Frank Act, Title VII may be cited as the ‘‘Wall Street Transparency and Accountability Act of 2010.’’

14 Final Rule, Real-Time Public Reporting of Swap Transaction Data, 77 Fed. Reg. 1182, 1185 (Jan. 9, 2012).

15 See 17 C.F.R. parts 15-19, 21.

16 See, e.g., 17 C.F.R. § 16.02 (requiring daily “trade and supporting data reports” consisting of “transaction-level

trade data and related order information for each futures or options contract”); 17 C.F.R. § 17.00(a) (requiring daily

reporting of “each futures position, separately for each reporting market and for each future, and each put and call

options position separately for each reporting market . . .”).

17 See, e.g., 17 C.F.R. § 16.01(e) (requiring publication of daily volume, price, and other information by DCMs and

SEFs); 17 C.F.R. § 38.500 (DCM Core Principle 9 requires DCMs to “provide a competitive, open, and efficient

market and mechanism for executing transactions that protects the price discovery process of trading in the centralized

market of the board of trade”).

ng market . . .”).

17 See, e.g., 17 C.F.R. § 16.01(e) (requiring publication of daily volume, price, and other information by DCMs and

SEFs); 17 C.F.R. § 38.500 (DCM Core Principle 9 requires DCMs to “provide a competitive, open, and efficient

market and mechanism for executing transactions that protects the price discovery process of trading in the centralized

market of the board of trade”).

4

Whether data related to a particular contract is required to be reported under the SDR

reporting regime depends on whether that particular contract is a “swap.”18 This no-action letter

addresses reporting for certain fully collateralized binary payout contracts and similar variable

payout contracts based on the occurrence or non-occurrence of the events that are the subjects of

the contracts. Such contracts may meet the “swap” definition, but are listed for trade by DCMs

(rather than swap execution facilities) and have similar characteristics as futures and options on

futures,19 including highly-standardized terms, exchange-trading protocols, fungibility, and

offset.20 Accordingly, this letter would allow for firms to report certain event contracts directly to

the Commission in a form similar to that provided for futures and options.

Although the term “event contract” is not defined in the CEA or the Commission’s

regulations, event contracts are generally understood to be a type of derivative contract, typically

with a binary payoff structure, based on the outcome of an underlying occurrence or event

to report certain event contracts directly to

the Commission in a form similar to that provided for futures and options.

Although the term “event contract” is not defined in the CEA or the Commission’s

regulations, event contracts are generally understood to be a type of derivative contract, typically

with a binary payoff structure, based on the outcome of an underlying occurrence or event. Event

contracts can be structured as swaps, futures,21 and/or options, depending on the structure and

terms of the contract, including the underlying event.22 Many, although not all, event contracts

that have traded or are currently trading on Commission-registered exchanges are structured as

binary options, which are generally understood as a type of option for which the payout is either a

fixed amount or zero.23 The Commission has generally found that binary options on commodities

18 7 U.S.C. § 2(a)(13)(G) (“Each swap (whether cleared or uncleared) shall be reported to a registered swap data

repository.”).

19 See 7 U.S.C. § 1a(47)(A)(ii) (defining “swap” to include “any agreement, contract, or transaction . . . that provides

for any purchase, sale, payment, or delivery (other than a dividend on an equity security) that is dependent on the

occurrence, nonoccurrence, or the extent of the occurrence of an event or contingency associated with a potential

financial, economic, or commercial consequence . . . .”); see 7 U.S.C. § 1a(36) (defining "option” to include “an

agreement, contract, or transaction that is of the character of, or is commonly known to the trade as, an ‘option’,

‘privilege’, ‘indemnity’, ‘bid’, ‘offer’, ‘put’, ‘call’, ‘advance guaranty’, or ‘decline guaranty’”).

20 See, e.g., CFTC Letter No

ingency associated with a potential

financial, economic, or commercial consequence . . . .”); see 7 U.S.C. § 1a(36) (defining "option” to include “an

agreement, contract, or transaction that is of the character of, or is commonly known to the trade as, an ‘option’,

‘privilege’, ‘indemnity’, ‘bid’, ‘offer’, ‘put’, ‘call’, ‘advance guaranty’, or ‘decline guaranty’”).

20 See, e.g., CFTC Letter No. 17-31 (June 30, 2017) (no-action position with respect to certain reporting requirements

for contracts the requester determined to be “swaps” but which the requester represented as “having most of the

characteristics of exchange traded futures or options thereon (fungibility, offset, exchange traded with standardized

terms) with few of the indicia of traditional swaps (bilateral, traded over-the-counter and customized)”).

21 See, e.g., Concept Release on the Appropriate Regulatory Treatment of Event Contracts, 73 Fed. Reg. 25669, 25670

(May 7, 2008) (“Event contracts, depending on their underlying interests, can be designed to exhibit the attributes of

either options or futures contracts.”).

22 For example, an event contract might be structured as an option that settles into a futures contract, and therefore fall

outside the “swap” definition. See 7 U.S.C. § 1a(47)(B)(i) (“The term ‘swap’ does not include . . . any contract of sale

of a commodity for future delivery (or option on such a contract) . . . .”).

23 For example, CFTC Letter No. 17-31 took a no-action position with respect to “binary options and spread contracts”

and CFTC Letter No. 17-32 took a no-action position with respect to binary options, including certain binary options

for which, “if the index value at expiry is exactly equal to the strike level, then both sides split the payment evenly.”

See CFTC Letter No. 17-31, at 1; CFTC Letter No. 17-32, at 1 n.3; see also CFTC Letter No. 25-02 (taking a no-

action position with respect to “variable payout contracts”). These examples are not exhaustive.

with respect to binary options, including certain binary options

for which, “if the index value at expiry is exactly equal to the strike level, then both sides split the payment evenly.”

See CFTC Letter No. 17-31, at 1; CFTC Letter No. 17-32, at 1 n.3; see also CFTC Letter No. 25-02 (taking a no-

action position with respect to “variable payout contracts”). These examples are not exhaustive.

5

meet the swap definition.24 DCM-listed binary options are also “options” as defined in 7 U.S.C.

§ 1a(36) 25 and regulation 15.00(o).26

Historically, before 2010, DCM-listed event contracts structured as binary options were

reported to the Commission as options under the futures and options reporting regime.27 After the

Commission issued regulations implementing the Dodd-Frank Act and creating the SDR reporting

regime, certain reporting markets28 listing event contracts structured as binary options and similar

products requested and received no-action positions providing that the Divisions would not

recommend an enforcement action for failure to report fully collateralized event contracts under

the SDR reporting regime on the condition that those reporting markets reported such contracts

under a version of the futures and options reporting regime.29 Specifically, each of the no-action

letters condition the no-action position on, among other things, the requestors (1) publishing on

their websites trade time and price information and (2) providing the Commission with regulation

16.02 transaction data reports.30 The no-action letters also generally require that the covered event

contracts be fully collateralized and cleared through certain clearinghouses.31

III.

Discussion

The Divisions believe the no-action position taken in this letter addresses several concerns.

First, certain DCM and DCO rulebook changes may require the beneficiary of an Event

Contract Reporting No-Action Letter to submit an additional request to modify or supplement that

no-action letter

ontracts be fully collateralized and cleared through certain clearinghouses.31

III.

Discussion

The Divisions believe the no-action position taken in this letter addresses several concerns.

First, certain DCM and DCO rulebook changes may require the beneficiary of an Event

Contract Reporting No-Action Letter to submit an additional request to modify or supplement that

no-action letter. For example, if a DCM wishes to clear transactions using a different DCO32 or

modifies rules that previously prohibited intermediation to permit intermediation,33 the no-action

positions previously granted by the Divisions may not apply to contracts traded pursuant to these

new rules. This creates additional burden for both industry and the Divisions, as DCMs may need

to request new no-action positions or modifications to previously issued no-action positions.

24 See In re Blockratize, Inc. d/b/a Polymarket.com, CFTC Dkt. No. 22-09, at 2 (Jan. 3, 2022), available at

https://www.cftc.gov/media/6891/enfblockratizeorder010322/download (certain “event contracts, each of which is

composed of a pair of binary options, constitute swaps”).

25 See, e.g., Commodity Futures Trading Comm'n v. Trade Exch. Network Ltd., 117 F. Supp. 3d 29, 36 (D.D.C. 2015)

(holding binary option event contracts allowing “customers to make predictions on the occurrence of events by either

buying or selling shares” were “options”); Commodity Futures Trading Comm’n v. Vision Fin. Partners, LLC, 190 F.

Supp. 3d 1126, 1130 (S.D. Fla. 2016) (finding binary options are commodity options as defined in 7 U.S.C. § 1a(36)).

26 17 C.F.R. § 15.00(o) (“Option, options, option contract, or options contract, unless specifically provided otherwise,

means any contract for the purchase or sale of a commodity option that is executed on or subject to the rules of a

reporting market, including all agreements, contracts and transactions that are treated by a clearing organization as

fungible with such contracts.”)

1a(36)).

26 17 C.F.R. § 15.00(o) (“Option, options, option contract, or options contract, unless specifically provided otherwise,

means any contract for the purchase or sale of a commodity option that is executed on or subject to the rules of a

reporting market, including all agreements, contracts and transactions that are treated by a clearing organization as

fungible with such contracts.”).

27 See Final Rule, Market and Large Trader Reporting, 71 Fed. Reg. 37809 (July 3, 2006) (establishing reporting levels

for binary option event contracts listed on HedgeStreet).

28 A “reporting market” is a “designated contract market or a registered entity under section 1a(40) of the [CEA].” 17

C.F.R. § 15.00(q).

29 See supra note 6.

30 Regulation 16.02 requires reporting markets to provide “provide trade and supporting data reports to the

Commission on a daily basis,” which include, among other things, “transaction-level trade data and related order

information for each futures or options contract.” 17 C.F.R. § 16.02.

31 See supra note 6.

32 See, e.g., CFTC Letter No. 24-15 (Oct. 4, 2024), available at https://www.cftc.gov/csl/24-15/download.

33 See, e.g., CFTC Letter No. 25-02 (Jan. 31, 2025), available at https://www.cftc.gov/csl/25-02/download.

6

Second, addressing swap reporting for event contracts on an ad hoc basis leaves open

opportunities for inconsistent no-action positions to be granted to similarly situated firms.

Third, absent a no-action position with respect to swap reporting, DCMs listing binary

options may be subject to duplicative reporting requirements under regulation 16.02, which applies

to options listed on a reporting market,34 and Part 45, which applies generally to swap transactions.

IV

s open

opportunities for inconsistent no-action positions to be granted to similarly situated firms.

Third, absent a no-action position with respect to swap reporting, DCMs listing binary

options may be subject to duplicative reporting requirements under regulation 16.02, which applies

to options listed on a reporting market,34 and Part 45, which applies generally to swap transactions.

IV.

No-Action Position

To address these concerns, the Divisions are taking a no-action position with respect to

swap reporting and recordkeeping for certain fully collateralized binary payout contracts and

similar variable payout contracts based on the occurrence or non-occurrence of the events that are

the subjects of the contracts. The Divisions will not recommend that the Commission initiate an

enforcement action against a DCM, a DCO, or their participants for failure to comply with

Commission regulations 38.8(b), 38.10, 38.951 (only to the extent that regulation 38.951 requires

compliance with Part 45 of the Commission’s regulations), 39.20(b)(2), as well as the applicable

provisions of Parts 43 and 45 of the Commission’s regulations, or the requirements of the relevant

CEA provisions pursuant to which the Relevant Regulations were promulgated, with respect to

“Covered Contracts,” subject to the following conditions:35

1) The no-action position provided in the foregoing letter (the “No-Action Position”)

applies only to “Covered Contracts.” Covered Contracts have the following

characteristics:

a. based on the outcome of an underlying occurrence, extent of an occurrence, or

contingency;

b. listed for trade on a designated contract market; and

c. trade as fully collateralized positions, as defined by Commission regulation

39.2.36

34 17 C.F.R. § 16.02 (“Reporting markets shall provide trade and supporting data reports to the Commission on a daily

basis. Such reports shall include transaction-level trade data and related order information for each futures or options

contract.”)

ted for trade on a designated contract market; and

c. trade as fully collateralized positions, as defined by Commission regulation

39.2.36

34 17 C.F.R. § 16.02 (“Reporting markets shall provide trade and supporting data reports to the Commission on a daily

basis. Such reports shall include transaction-level trade data and related order information for each futures or options

contract.”).

35 Some of these conditions regarding the no-action position may constitute a collection of information, as that term

is defined in the Paperwork Reduction Act, 44 U.S.C. §§ 3501 et. seq. The Office of Management and Budget

(“OMB”)—in accordance with 44 U.S.C. § 3507(d) and 5 C.F.R. §§ 1320.8 and 1320.10—has approved collection

3038-0049, entitled “Procedural requirements for requests for interpretative, no-action and exemptive letters,” for

such purposes. This collection would encompass collections made as part of exemptive or no-action positions from

the Commission or its staff. The public is not required to respond to a collection of information that does not have a

valid OMB control number.

36 Commission regulations define “fully collateralized position” as “a contract cleared by a derivatives clearing

organization that requires the derivatives clearing organization to hold, at all times, funds in the form of the required

payment sufficient to cover the maximum possible loss that a party or counterparty could incur upon liquidation or

expiration of the contract.” 17 C.F.R. § 39.2.

Commission regulations define “fully collateralized position” as “a contract cleared by a derivatives clearing

organization that requires the derivatives clearing organization to hold, at all times, funds in the form of the required

payment sufficient to cover the maximum possible loss that a party or counterparty could incur upon liquidation or

expiration of the contract.” 17 C.F.R. § 39.2.

7

2) Beneficiary Designated Contract Market (“Beneficiary DCM”) will clear all Covered

Contracts through a Beneficiary Derivatives Clearing Organization (“Beneficiary

DCO”);

3) Beneficiary DCM will publish on its website the following information for all Covered

Contracts transactions promptly37 after execution thereof: trade timestamp, contract,

quantity, and price;

4) Beneficiary DCM will provide the Commission with all transactional information for

Covered Contracts as described in Commission regulation 16.02;

5) Beneficiary DCM and any Beneficiary DCO will comply with all reporting and

recordkeeping requirements of the CEA and CFTC regulations applicable to them in

their respective capacities as a DCM and a DCO, other than 38.8(b), 38.10, 38.951

(only to the extent that regulation 38.951 requires compliance with Part 45 of the

Commission’s regulations), and 39.20(b)(2),38 and Parts 43 and 45,39 including, but not

limited to, the applicable requirements of Parts 38 and 39 of the Commission’s

regulations (the records required to be retained by this condition (5) are referred to

below as the “Required Records”); and

6) Beneficiary DCM and any Beneficiary DCO keep the Required Records open to

inspection upon request by any representative of the Commission, the United States

Department of Justice, or the Securities and Exchange Commission, or by any

representative of a prudential regulator as authorized by the Commission. Copies of

all such records shall be provided, at the expense of Beneficiary DCM and any

Beneficiary DCO to any representative of the Commission upon request

n to

inspection upon request by any representative of the Commission, the United States

Department of Justice, or the Securities and Exchange Commission, or by any

representative of a prudential regulator as authorized by the Commission. Copies of

all such records shall be provided, at the expense of Beneficiary DCM and any

Beneficiary DCO to any representative of the Commission upon request. Beneficiary

DCM and any Beneficiary DCO shall provide copies of the Required Records either

by electronic means, in hard copy, or both, as requested by the Commission, with the

sole exception that copies of records originally created and exclusively maintained in

paper form may be provided in hard copy only.

The no-action position provided in this letter applies to entities enumerated in the Appendix

to this letter. The Divisions anticipate that additional entities may wish to seek a similar no-action

position in the future. Entities intending to list contracts that have the characteristics of Covered

Contracts may request a no-action position identical to the no-action position set out in this letter.

If the Divisions grant such request, the Divisions will publish an updated Appendix reflecting

additional beneficiaries.

As described above, to ensure uniformity, this letter applies to the beneficiaries of all

previously issued no-action letters applicable to these contracts. This letter will expire upon the

compliance date of any final action taken by the Commission with respect to this matter.

37 “Promptly” means “as soon as technologically practicable,” as defined in regulation 43.2. 17 C.F.R. § 43.2(a).

38 17 C.F.R. § 38.8(b), § 38.10, § 38.951, § 39.20(b)(2).

39 17 C.F.R. Part 43; 17 C.F.R. Part 45.

sued no-action letters applicable to these contracts. This letter will expire upon the

compliance date of any final action taken by the Commission with respect to this matter.

37 “Promptly” means “as soon as technologically practicable,” as defined in regulation 43.2. 17 C.F.R. § 43.2(a).

38 17 C.F.R. § 38.8(b), § 38.10, § 38.951, § 39.20(b)(2).

39 17 C.F.R. Part 43; 17 C.F.R. Part 45.

8

This letter expresses a staff position only with respect to enforcement of the Relevant

Regulations. This letter does not state any legal conclusion regarding the characteristics or legality

of any Covered Contract or the conduct of any person covered by the no-action position.40 This

letter and the no-action position taken herein represent the views of the Divisions only, and do not

necessarily represent the positions or views of the Commission or of any other Commission

division or office. This letter and the no-action position taken herein are not binding on the

Commission.41 Except as explicitly provided in this letter, the no-action position taken herein does

not excuse persons from compliance with any applicable requirements of the CEA or Commission

regulations. Further, this letter, and the no-action position contained herein, are based upon the

representations made to the Divisions. Any different, changed, or omitted material facts or

circumstances may render this letter void. As with all no-action letters, the Divisions retain the

authority to, in their discretion, further condition, modify, suspend, terminate or otherwise restrict

the terms of the no-action position provided herein.

If you have any questions concerning this letter, please contact Paul Chaffin, Division of

Market Oversight, at (202) 418-5185 or pchaffin@cftc.gov; Alicia Silverman, Division of Market

Oversight, at (202) 418-5219 or asilverman@cftc.gov; Owen Kopon, Division of Market

Oversight, at (202) 418-5360 or okopon@cftc.gov

or otherwise restrict

the terms of the no-action position provided herein.

If you have any questions concerning this letter, please contact Paul Chaffin, Division of

Market Oversight, at (202) 418-5185 or pchaffin@cftc.gov; Alicia Silverman, Division of Market

Oversight, at (202) 418-5219 or asilverman@cftc.gov; Owen Kopon, Division of Market

Oversight, at (202) 418-5360 or okopon@cftc.gov.

Sincerely,

____________________

Joshua Beale

Acting Director

Division of Market Oversight

____________________

Richard Haynes

Acting Director

Division of Clearing and Risk

40 For the avoidance of doubt, this letter is not intended to address whether any Covered Contract is consistent with

any statutory or regulatory requirement, including with respect to the requirements of CEA section 5c(c)(5)(C) or

Commission regulation 40.11. 17 C.F.R. § 40.11.

41 See 17 C.F.R. § 140.99(a)(2) (“A no-action letter binds only the issuing Division… and not the Commission or

other Commission staff.”).

Appendix – Beneficiaries of No-Action Position (as of July 16, 2026)

Aristotle Exchange DCM, Inc.

Aristotle Exchange DCO, Inc.

Bitnomial Exchange, LLC

Bitnomial Clearinghouse, LLC

Chicago Mercantile Exchange Inc.

C.X. Clearinghouse, L.P., formerly Cantor Clearinghouse, L.P.

Electron Exchange DCM, LLC

Electron Exchange DCO, LLC

FMX Futures Exchange, L.P., formerly Cantor Futures Exchange, L.P.

ForecastEx LLC

Gemini Olympus, LLC

Gemini Titan, LLC

KalshiEX LLC

Kalshi Klear LLC

Ludlow Exchange, LLC

North American Derivatives Exchange, Inc. d/b/a Crypto.com Derivatives North America

ProphetX LLC

QC Clearing LLC d/b/a Polymarket Clearing

QCX LLC d/b/a Polymarket US

Railbird Exchange, Inc.

Rothera Exchange and Clearing, LLC, formerly LedgerX LLC

Water Street Labs, LLC