Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of Filing of Amendment No. 2

   
   
   
 
SECURITIES AND EXCHANGE COMMISSION  
[Release No. 34-103997; File No. SR-CBOE-2025-004] 
Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of Filing of Amendment No. 2 
and Order Granting Accelerated Approval of a Proposed Rule Change, as Modified by 
Amendment No. 2, to Add P.M.-Settled Options on the Cboe Bitcoin U.S. ETF Index and 
the Mini-Cboe Bitcoin U.S. ETF Index with Third Friday Expirations, Nonstandard 
Expirations, and Quarterly Index Expirations 
September 17, 2025. 
I. Introduction 
 
 On February 14, 2025, Cboe Exchange, Inc. (“Cboe” or “Exchange”) filed with the 
Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the 
Securities Exchange Act of 1934 (“Act”)
1
 and Rule 19b-4 thereunder,
2
 a proposed rule change to 
add p.m.-settled options on the Cboe Bitcoin U.S. ETF Index (“CBTX”) and the Mini-Cboe 
Bitcoin U.S. ETF Index (“MBTX”) with third Friday expirations, nonstandard expirations, and 
quarterly index expirations. The proposed rule change was published for comment in the Federal 
Register on March 5, 2025.
3
 On April 16, 2025, the Commission designated a longer period 
within which to take action on the proposed rule change.
4
 On April 22, 2025, the Exchange filed 
Amendment No. 1 to the proposed rule change.
5
 Amendment No. 1 superseded the original 
                                                      
1
  15 U.S.C. 78s(b)(1). 
2
  17 CFR 240.19b-4. 
3
  See Securities Exchange Act Release No. 102502 (Feb. 27, 2025), 90 FR 11343 (Mar. 5, 2025). The 
Commission did not receive any comments on the proposal.   
4
  See Securities Exchange Act Release No. 102870 (Apr. 16, 2025), 90 FR 16894 (Apr. 22, 2025).   
5
  The full text of Amendment No. 1 is available on the Commission’s website at 
https://www.sec.gov/comments/sr-cboe-2025-004/srcboe2025004.htm. Amendment No. 1 provided 
additional support for the proposal and did not change the proposed rules of the original filing. 
 

2 
 
 
 
 
 
 
proposed rule change in its entirety. On June 2, 2025, the Commission published for comment 
the proposed rule change, as modified by Amendment No. 1, and instituted proceedings under 
Section 19(b)(2)(B) of the Act
6
 to determine whether to approve or disapprove the proposed rule 
change, as modified by Amendment No. 1.
7
 On July 23, 2025, the Exchange filed Amendment 
No. 2 to the proposed rule change, which supersedes the proposed rule change, as modified by 
Amendment No. 1, in its entirety.
8
 On August 28, 2025, the Commission designated a longer 
period for Commission action on the proposed rule change, as modified by Amendment No. 2.
9
 
The Commission is publishing this notice to solicit comments on Amendment No. 2 from 
interested persons, and is approving the proposed rule change, as modified by Amendment No. 2, 
on an accelerated basis.  
II. Description of the Proposal, as Modified by Amendment No. 2
10
 
The Exchange proposes to amend Rules 4.13 (Series of Index Options), 5.1 (Trading 
Days and Hours), and 8.32 (Position Limits for Industry Index Options). First, the Exchange 
proposes to amend Rule 4.13(e), which governs its Nonstandard Expirations Program, to permit 
p.m.-settled options on CBTX and MBTX, which are narrow-based index options, that expire on: 
(1) any Monday, Tuesday, Wednesday, Thursday, or Friday (other than the third Friday-of-the-
                                                      
6
  15 U.S.C. 78s(b)(2)(B).  
7
  See Securities Exchange Act Release No. 103168 (June 2, 2025), 90 FR 24180 (June 6, 2025).  
8
  Amendment No. 2 includes the changes made by Amendment No. 1 and also amends Rule 4.13, 
Interpretation and Policy .13, to add the defined term “P.M.-Settled Third Friday Index Options”, and 
modifies Rule 8.32(f) to add that positions in QIXs (defined below) and P.M.-Settled Third Friday Index 
Options will also be aggregated with positions in options contracts in the same index class. Amendment 
No. 2 is available at: https://www.sec.gov/comments/sr-cboe-2025-004/srcboe2025004-631167-
1867334.pdf. 
9
  See Securities Exchange Act Release No. 103804 (Aug. 28, 2025), 90 FR 42645 (Sept. 3, 2025). The 
Commission designated October 31, 2025, as the date by which the Commission shall approve or 
disapprove the proposed rule change, as modified by Amendment No. 2.   
10
  For a full description of the proposed rule change, refer to Amendment No. 2, supra note 8. 

3 
 
 
 
 
 
 
month (“Expiration Friday”) or on days that coincide with an end-of-month expiration) (“Weekly 
Expirations”) and (2) the last trading day of the month (“EOMs”). The Exchange also proposes 
to amend Rule 4.13(c), which governs quarterly index expirations, to add CBTX and MBTX 
options to the list of options in Rule 4.13(c) that are eligible for quarterly index expirations 
(“QIXs”). Further, the Exchange proposes to amend Rule 4.13, Interpretation and Policy .13, to 
permit the listing of p.m.-settled CBTX and MBTX options that expire on Expiration Fridays.  
In addition, the Exchange proposes to amend Rule 5.1(b)(2)(C) to provide that, on their 
last trading day, transactions in expiring CBTX and MBTX p.m.-settled options that expire on 
Expiration Fridays may be effected on the Exchange between 9:30 a.m. and 4:00 p.m. Eastern 
Time. 
Finally, the Exchange proposes to amend Rule 8.32(f) to provide that positions in 
Nonstandard Expirations Program series, QIXs, and p.m.-settled options listed pursuant to Rule 
4.13, Interpretation and Policy .13 will be aggregated with other options contracts in the same 
index class for purposes of position limits.  
Amendments to Rule 4.13 
Under the Exchange’s Nonstandard Expirations Program, the Exchange can currently list 
p.m.-settled Weekly Expirations and EOM expirations on any broad-based index eligible for 
standard options trading.
11
 New series in Weekly Expirations and EOM expirations may be 
added up to and including on the expiration date for expiring Weekly Expirations or EOM 
expirations.
12
 The Exchange proposes to expand the availability of Weekly Expirations and 
EOM expirations to CBTX and MBTX options, which are narrow-based index options that are 
                                                      
11
  See Amendment No. 2, supra note 8, at 4. 
12
  See id. at 5. 
 

4 
 
 
 
 
 
 
eligible for standard options trading.
13
 The Exchange states that the Nonstandard Expirations 
Program will apply to CBTX and MBTX options in the same manner as it currently applies to 
broad-based index options.
14
 Weekly Expirations and EOM expirations are subject to all 
provisions of Rule 4.13 and treated the same as options on the same underlying index that expire 
on Expiration Friday; provided, however, that Weekly Expirations and EOM expirations are 
p.m.-settled, and new series in Weekly Expirations and EOM expirations may be added up to and 
including on the expiration date for an expiring Weekly Expiration or EOM expiration.
15
  
The maximum number of expirations that may be listed for each Weekly Expiration in a 
given class is the same as the maximum number of expirations permitted in Rule 4.13(a)(2) for 
standard options on the same index.
16
 Weekly Expirations need not be for consecutive Monday, 
Tuesday, Wednesday, Thursday, or Friday expirations as applicable; however, the expiration 
date of a nonconsecutive expiration may not be beyond what would be considered the last 
expiration date if the maximum number of expirations were listed consecutively.
17
 Weekly 
Expirations that are first listed in a given class may expire up to four weeks from the actual 
listing date.
18
  
                                                      
13
  See id. at 4. The Exchange states that these options are already eligible for the Monthly Options Series 
program pursuant to Rule 4.13(a)(2)(C), which permits p.m.-settled options that expire on the last trading 
day of the month (the same as EOM expirations). See id. at 4, n.3.  
14
  See id. at 4. 
15
  See id. at 4-5.  
16
  See id. at 5. Currently, under Rule 4.13(a)(2), the Exchange may list up to six standard monthly expirations 
on CBTX and MBTX. See Cboe Rule 4.13(a)(2). The Exchange also proposes to delete the phrase “broad-
based” in several places in Rule 4.13(e), as the proposal would result in the provisions within that rule 
applying to indexes that are not broad-based. The Exchange states that it is not proposing to expand the 
Nonstandard Expirations Program to narrow-based indexes generally, but rather only to MBTX and CBTX 
options. See id. at 5, n.4. 
17
  See id. at 5.  
18
  See id. 
 

5 
 
 
 
 
 
 
Similar to Weekly Expirations, the maximum number of expirations that may be listed in 
a given class for each EOM expiration is the same as the maximum number of expirations 
permitted in Rule 4.13(a)(2) for standard options on the same index.
19
 EOM expirations need not 
be for consecutive end of month expirations; however, the expiration date of a non-consecutive 
expiration may not be beyond what would be considered the last expiration date if the maximum 
number of expirations were listed consecutively.
20
 EOM expirations that are first listed in a given 
class may expire up to four weeks from the actual listing date.
21
 If the Exchange lists EOM 
expirations and Weekly Expirations in a given class, the Exchange will list an EOM instead of a 
Weekly Expiration that expires on the same day in such class.
22
 Other expirations in the same 
class are not counted as part of the maximum number of Weekly Expirations or EOM expirations 
for an applicable index class.
23
  
The Exchange also proposes to amend Rule 4.13(c) to add CBTX and MBTX options to 
the list of options in Rule 4.13(c) that are eligible for the QIX program.
24
 The Exchange states 
that the QIX program will apply to CBTX and MBTX options in the same manner as it currently 
applies to the other options currently eligible for those expirations.
25
 Under the QIX program, the 
Exchange may open up to eight near-term quarterly expirations in a class.
26
 QIXs are subject to 
                                                      
19
  See id. 
20
  See id. 
21
  See id. 
22
  See id. at 5-6. 
23
  See id. at 6. 
24
  See id. QIXs are currently available for options on the S&P 100 Index, S&P 500 Index (“SPX options”), 
Mini-S&P 500 Index (“XSP options”), the Russell 2000 Index (“RUT options”), and Mini-Russell 2000 
Index (“MRUT options”). Id. 
25
  See id. at 6-7. 
26
  See id. at 6. 
 

6 
 
 
 
 
 
 
all provisions of Rule 4.13 and treated the same as options on the same underlying index that 
expire on Expiration Friday, except that QIXs are p.m.-settled.
27
  
Additionally, the Exchange proposes to amend Rule 4.13, Interpretation and Policy .13, 
to permit the listing of p.m.-settled CBTX and MBTX options that expire on Expiration 
Fridays.
28
 The Exchange states that CBTX and MBTX options that are p.m.-settled and expire on 
Expiration Fridays will be subject to all provisions of Rule 4.13 and treated the same as a.m.-
settled CBTX and MBTX options, except that they would be p.m.-settled.
29
 In combination with 
the proposed Weekly Expirations for CBTX and MBTX options, this proposed change would 
allow the Exchange to list p.m.-settled CBTX and MBTX options with expirations every day of 
the week.
30
  
Amendment to Rule 5.1 
The Exchange proposes to amend Rule 5.1(b)(2)(C) in conjunction with the proposed 
addition of CBTX and MBTX options that are p.m.-settled and expire on Expiration Friday.
31
 
The Exchange states that Rule 5.1(b)(2)(C) provides that on their last trading day, transactions in 
index options with Nonstandard Expirations, QIXs, as well as expiring p.m.-settled SPX, XSP, 
RUT, and MRUT options, may be effected on the Exchange between 9:30 a.m. and 4:00 p.m. 
                                                      
27
  See id. at 7. The Exchange states that CBTX and MBTX options are currently eligible for the Quarterly 
Options Series program which permits p.m.-settled options that expire on the last trading day of the quarter 
(the same as QIXs). See id. at 6, n.5. 
28
  See id. at 7. Pursuant to Rule 4.13, Interpretation and Policy .13, the Exchange is permitted to list p.m.-
settled SPX options, XSP options, RUT options, and MRUT options that expire on Expiration Fridays. 
Amendment No. 2 amends Interpretation and Policy .13, to define these expirations, as well as p.m.-settled 
CBTX and MBTX that expire on Expiration Fridays, as proposed, as “P.M.-Settled Third Friday Index 
Options.”  
29
  See id. at 7.  
30
  See id. 
31
  See id. 
 

7 
 
 
 
 
 
 
Eastern Time.
32
 The proposed rule change amends Rule 5.1(b)(2)(C) to apply the provision to 
p.m.-settled CBTX and MBTX options that expire on Expiration Fridays.
33
  
Amendment to Rule 8.32 
The Exchange proposes to amend Rule 8.32(f) to provide that positions in the 
Nonstandard Expirations Program series, QIXs, and P.M.-Settled Third Friday Index Options 
will be aggregated with positions in options contracts in the same index class.
34
 For purposes of 
position limits, this proposed change would aggregate CBTX and MBTX options positions in the 
Nonstandard Expirations Program, QIX program, and with p.m.-settled Expiration Friday 
expirations with positions in CBTX and MBTX options, respectively, that have other 
expirations.
35
 This would be consistent with the treatment of positions for purposes of position 
limits for other classes that participate in the Nonstandard Expirations Program, QIX program, 
and with p.m.-settled Expiration Friday expirations.
36
 The Exchange adds that the exercise limits 
for index options (including CBTX and MBTX options) are equivalent to the position limits that 
are set forth in Rule 8.32.
37
 Therefore, the current position and exercise limits for CBTX and 
MBTX options are 24,000 contracts (and may not be more than 31,500 without rule changes).
38
  
In support of its proposal to amend the Nonstandard Expirations Program to expand the 
availability of Weekly Expirations to options on CBTX and MBTX, the Exchange states that it is 
                                                      
32
  Regular trading hours for non-expiring options are 9:30 a.m. to 4:15 p.m. See id. at 7-8. 
33
  See id. at 8. 
34
  See id. at 12, n.13. Amendment No. 2 adds QIX and P.M.-Settled Third Friday Index Options to Rule 
8.32(f). The Exchange explains that these series were inadvertently omitted from the rule text. See id. at 3, 
12, n.13. 
35
  See id. at 12, n.13.  
36
  See id. See also Cboe Rule 8.31(b). 
37
  See Amendment No. 2, supra note 8, at 12, n.13. 
38
  See id. See also Cboe Rules 8.32(a) and 8.42(b). 
 

8 
 
 
 
 
 
 
currently permitted to list Weekly Expirations on options on any broad-based index that are 
eligible for standard trading under the Nonstandard Expirations Program and that the 
Nonstandard Expirations Program will apply to CBTX and MBTX options in the same manner.
39
 
In support of its proposal to permit the listing of p.m.-settled CBTX and MBTX options that 
expire on Expiration Friday, the Exchange states that it currently lists Expiration Friday p.m.-
settled options on broad-based indexes SPX, XSP, RUT and MRUT, and that p.m.-settled CBTX 
and MBTX options that expire on Expiration Fridays would be subject to all provisions of Rule 
4.13 and would be treated the same as a.m.-settled CBTX and MBTX options except for being 
p.m.-settled.
40
 The Exchange states that the addition of Weekly Expirations and p.m.-settled 
Expiration Friday expirations for CBTX and MBTX options would allow market participants “to 
purchase an option based on their needed timing and allow them to tailor their investment or 
hedging needs more effectively”
41
 as well as “more effectively manage overnight risk and trade 
out of their positions up until the contract settles.”
42
 Additionally, the Exchange states that there 
is sufficient investor interest and demand for these Weekly Expirations and Expiration Friday 
expirations.
43
  
 The Exchange explains that its proposal to amend its Nonstandard Expirations Program 
to expand the availability of EOM expirations to options on CBTX and MBTX would be 
consistent with the Exchange’s Monthly Options Series program, which already permits the 
listing of p.m.-settled options on CBTX and MBTX that expire on the last trading day of the 
                                                      
39
  See Amendment No. 2, supra note 8, at 4. 
40
  See id. at 7. 
41
  See id. at 10. 
42
  See id. 
43
  See id. at 11. 
 

9 
 
 
 
 
 
 
month.
44
 Similarly, the Exchange proposes to make CBTX and MBTX options eligible for the 
QIX program and states that p.m.-settled CBTX and MBTX options with expiration on the last 
trading day of the quarter are already permitted under its Quarterly Options Series program.
45
 
III. Discussion and Commission Findings 
 
After careful review, the Commission finds that the proposed rule change, as modified by 
Amendment No. 2, is consistent with the Act and the rules and regulations thereunder applicable 
to a national securities exchange.
46
 In particular, the Commission finds that the proposed rule 
change, as modified by Amendment No. 2, is consistent with Section 6(b)(5) of the Act,
47
 which 
requires, among other things, that the Exchange’s rules be designed to prevent fraudulent and 
manipulative acts and practices, 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. 
In evaluating whether this proposal is consistent with Section 6(b)(5), and, in particular, 
whether it is designed to prevent fraudulent and manipulative acts and practices and to protect 
investors and the public interest, the Commission considered the potential impacts of p.m.-
settled, cash-settled options 
on the underlying cash equities markets, and in particular, the 
potential for added market volatility and sharp price movements near the close on expiration 
days. 
The Commission has had concerns about the adverse effects and impact of p.m.-settlement 
upon market volatility and the operation of fair and orderly markets on the underlying cash 
                                                      
44
  See id. at 4, n.3. 
45
  See id. at 4, n.5 and accompanying text. 
46
  In approving this proposed rule change, as modified by Amendment No. 2, the Commission has considered 
the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). 
47
  15 U.S.C. 78f(b)(5). 
 

10 
 
 
 
 
 
 
market at or near the close of trading on expiration days.
48
 However, the Commission approved 
proposals from several exchanges, including the Exchange, to permanently establish programs 
permitting the listing and trading of certain p.m.-settled broad-based index options.
49
 In 
approving these proposals, the Commission reviewed data provided by the exchanges in their 
filings, the exchanges’ pilot data and reports, as well as an analysis conducted at the direction of 
Staff from the Commission’s Division of Economic and Risk Analysis and concluded that 
analysis of the pilot data did not identify any significant economic impact on the underlying 
component securities surrounding the close as a result of expiring p.m.-settled options nor did it 
indicate a deterioration in market quality for an existing product when a new p.m.-settled 
expiration was introduced.
50
 Further, the Commission stated that significant changes in closing 
procedures in the decades since index options moved to a.m.-settlement may also serve to 
mitigate the potential impact of p.m.-settled index options on the underlying cash markets.
51
  
In support of its proposal, the Exchange states that it does not believe its proposal would 
adversely impact fair and orderly markets on expiration days.
52
 The Exchange explains that it has 
                                                      
48
  See Securities Exchange Act Release No. 65256 (Sept. 2, 2011), 76 FR 55969, at 55972 (Sept. 9, 2011) 
(SR-C2-2011-008) (Order approving proposed rule change to establish a pilot program to list and trade 
SPXPM options on the C2 Options Exchange, Inc.).  
49
  See e.g., Securities Exchange Act Release Nos. 98454 (Sept. 20, 2023), 88 FR 66103 (Sept. 26, 2023) (SR-
CBOE-2023-005) (“SPXPM Permanent Approval Order”); and 98455 (Sept. 20, 2023), 88 FR 66073 (Sept. 
26, 2023) (SR-CBOE-2023-019) (“XSPPM and MRUTPM Permanent Approval Order”). See also 
Securities Exchange Act Release Nos. 98450 (Sept. 20, 2023), 88 FR 66111 (Sept. 26, 2023) (SR-ISE-
2023-08) (Order Granting Approval of a Proposed Rule Change, as Modified by Amendment No. 1, to 
Make Permanent Certain P.M.-Settled Pilots) (“ISE Pilots Permanent Approval Order”); and 98451 (Sept. 
20, 2023), 88 FR 66088 (Sept. 26, 2023) (SR-PHLX-2023-07) (Order approving a nonstandard expirations 
pilot program and p.m.-settled XND options) (“Phlx Pilots Permanent Approval Order”). See also 
Securities Exchange Act Release Nos. 98935 (Nov. 14, 2023), 88 FR 80792 (Nov. 20, 2023) (SR-ISE-
2023-20) (Order approving the listing and trading of p.m.-settled Nasdaq-100 Index Options with a third 
Friday-of-the-month expiration) (“NDXPM Approval Order”). 
50
  See e.g., XSPPM and MRUTPM Permanent Approval Order, 88 FR at 66075-76. 
51
  See id. 
52
  See Amendment No. 2, supra note 8, at 14. 
 

11 
 
 
 
 
 
 
not experienced any meaningful regulatory concerns, nor adverse impact on fair and orderly 
markets, in connection with its Nonstandard Expirations Program, Expiration Friday expirations, 
or QIX program, nor with the listing of p.m.-settled CBTX and MBTX options in the Quarterly 
Options Series and the Monthly Options Series, which, like the proposed QIXs and EOM 
expirations, are p.m.-settled and expire on the last trading day of the quarter and month, 
respectively.
53
  
Additionally, the Exchange states that p.m.-settlement is appropriate for CBTX and 
MBTX options for several reasons. According to the Exchange, the size of the markets of the 
underlying components,
54
 the weighting of the components, and the high correlation of these 
components make it unlikely the proposal would result in material impact on the component 
markets, the index value, or the broader market.
55
 Further, the Exchange states that CBTX and 
MBTX options trade within a complex where there are multiple other highly correlated 
instruments that all hold bitcoin available for hedging—such as options on the underlying 
components, shares of other exchange traded products that hold bitcoin, and bitcoin futures, in 
addition to the underlying components—and that this reduces the risk that listing these options 
would strain liquidity providers or materially impact the component markets, the index value, or 
the broader market.
56
  
                                                      
53
  See id. 
54
  According to the Exchange, as of April 15, 2025, the assets under management of the index components 
range from $130 million to $48 billion. See id. at 17, n.22. Further, according to the Exchange, the indexes 
underlying CBTX and MBTX options satisfy the generic listing criteria for narrow-based index options in 
Rule 4.10(b), which are designed to ensure that the trading markets for the components are adequately 
capitalized and sufficiently liquid, and that no one component dominates the index, thus minimizing the 
potential for manipulation. See id. at 19.  
55
  See id. at 17. 
56
  See id. 
 

12 
 
 
 
 
 
 
The proposals approved by the Commission permitted the listing and trading of certain 
p.m.-settled broad-based index options.
57
 This proposed rule change, as modified by Amendment 
No. 2, would permit the listing and trading of p.m.-settled index options for CBTX and MBTX. 
In evaluating the proposals permitting the listing and trading of other p.m.-settled index options, 
the Commission evaluated the potential for negative impacts on the underlying component 
securities of the indexes and options market quality.
58
 As noted above, the index components for 
CBTX and MBTX trade within a complex with multiple highly correlated instruments available 
for hedging, including the index components, options on the components, shares of other 
exchange-traded products holding spot bitcoin, and bitcoin futures. Further, the underlying 
components of the indexes are generally highly liquid and closely correlated with one another. 
As a result, it would be unlikely for p.m.-settled options on CBTX and MBTX to increase market 
and price volatility in the underlying index components or in the CBTX and MBTX options 
market.  
The Exchange’s proposal to expand the Nonstandard Expirations Program and the QIX 
program to CBTX and MBTX options, and make the options eligible for p.m.-settled Expiration 
Friday expirations, is a reasonably designed expansion of existing p.m.-settled index option 
programs that may provide the investing public and other market participants more flexible 
trading and hedging opportunities. Further, the proposed change to Rule 8.32(f) would aggregate 
positions in CBTX and MBTX options across expirations in the same class, which could reduce 
the potential incentives to manipulate or disrupt the underlying market to benefit the options 
                                                      
57
  See e.g., SPXPM Permanent Approval Order; XSPPM and MRUTPM Permanent Approval Order; ISE 
Pilots Permanent Approval Order; and Phlx Pilots Permanent Approval Order. See also NDXPM Approval 
Order. 
58
  See e.g., SPXPM Permanent Approval Order, 88 FR at 66106. 
 

13 
 
 
 
 
 
 
position and would not allow the maintenance of significant open interest in the options.
59
 The 
Exchange also has a surveillance program in place to monitor trading in the proposed p.m.-
settled options on CBTX and MBTX and systems capacity to support the proposed new options 
series.
60
 The Commission expects the Exchange to continue to monitor any potential risks from 
large p.m.-settled positions and take appropriate action on a timely basis if warranted.  
 For these reasons, the Commission finds that the proposed rule change, as modified by 
Amendment No. 2, is consistent with Section 6(b)(5) of the Act
61
 and the rules and regulations 
thereunder applicable to a national securities exchange.  
IV. Solicitation of Comments on Amendment No. 2 to the Proposed Rule Change  
Interested persons are invited to submit written data, views, and arguments concerning 
whether Amendment No. 2 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-CBOE-2025-004 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. 
                                                      
59
  See Amendment No. 2, supra note 8, at 12, n.13. 
60
  See id. at 11. 
61
  15 U.S.C. 78f(b)(5). 

14 
 
 
 
 
 
 
All submissions should refer to file number SR-CBOE-2025-004. 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 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-2025-004 and should be submitted on or 
before [INSERT DATE 21 DAYS AFTER DATE OF PUBLICATION IN THE FEDERAL 
REGISTER]. 
V. Accelerated Approval of the Proposed Rule Change, as Modified by Amendment No. 2 
 
 The Commission finds good cause to approve the proposed rule change, as modified by 
Amendment No. 2, prior to the thirtieth day after the date of publication of notice of the filing of 
Amendment No. 2 in the Federal Register. In Amendment No. 2, the Exchange amends Rule 
4.13, Interpretation and Policy .13, to add the defined term “P.M.-Settled Third Friday Index 
Options”, modifies Rule 8.32(f) to add that positions in QIXs and P.M.-Settled Third Friday 
Index Options (which include CBTX and MBTX) will be aggregated with positions in options 
contracts in the same index class, and provides additional support for the proposal. The changes 
to the proposal in Amendment No. 2 ensure consistent treatment of positions in the proposed 
CBTX and MBTX QIXs and p.m.-settled Expiration Friday options with other options in the 
same index class and assist the Commission in evaluating the Exchange’s proposal and in 
determining that it is consistent with the Act. Accordingly, the Commission finds good cause, 

15 
 
 
 
 
 
 
pursuant to Section 19(b)(2) of the Act,
62 
to approve the proposed rule change, as modified by 
Amendment No. 2, on an accelerated basis. 
  
                                                      
62
  15 U.S.C. 78s(b)(2).  

16 
 
 
 
 
 
 
VI. Conclusion 
 
IT IS THEREFORE ORDERED, pursuant to Section 19(b)(2) of the Act,
63
 that the 
proposed rule change (SR-CBOE-2025-004), as modified by Amendment No. 2, be and hereby 
is, approved on an accelerated basis. 
By the Commission. 
 
Stephanie J. Fouse, 
Assistant Secretary. 
 
 
                                                      
63
  Id. 

SECURITIES AND EXCHANGE COMMISSION  

[Release No. 34-103997; File No. SR-CBOE-2025-004] 

Self-Regulatory Organizations; Cboe Exchange, Inc.; Notice of Filing of Amendment No. 2 

and Order Granting Accelerated Approval of a Proposed Rule Change, as Modified by 

Amendment No. 2, to Add P.M.-Settled Options on the Cboe Bitcoin U.S. ETF Index and 

the Mini-Cboe Bitcoin U.S. ETF Index with Third Friday Expirations, Nonstandard 

Expirations, and Quarterly Index Expirations 

September 17, 2025. 

I. Introduction 

 

 On February 14, 2025, Cboe Exchange, Inc. (“Cboe” or “Exchange”) filed with the 

Securities and Exchange Commission (“Commission”), pursuant to Section 19(b)(1) of the 

Securities Exchange Act of 1934 (“Act”)1 and Rule 19b-4 thereunder,2 a proposed rule change to 

add p.m.-settled options on the Cboe Bitcoin U.S. ETF Index (“CBTX”) and the Mini-Cboe 

Bitcoin U.S. ETF Index (“MBTX”) with third Friday expirations, nonstandard expirations, and 

quarterly index expirations. The proposed rule change was published for comment in the Federal 

Register on March 5, 2025.3 On April 16, 2025, the Commission designated a longer period 

within which to take action on the proposed rule change.4 On April 22, 2025, the Exchange filed 

Amendment No. 1 to the proposed rule change.5 Amendment No. 1 superseded the original 

                                                      
1  15 U.S.C. 78s(b)(1). 

2  17 CFR 240.19b-4. 

3  See Securities Exchange Act Release No. 102502 (Feb. 27, 2025), 90 FR 11343 (Mar. 5, 2025). The 

Commission did not receive any comments on the proposal.   

4  See Securities Exchange Act Release No. 102870 (Apr. 16, 2025), 90 FR 16894 (Apr. 22, 2025).   

5  The full text of Amendment No. 1 is available on the Commission’s website at 

https://www.sec.gov/comments/sr-cboe-2025-004/srcboe2025004.htm. Amendment No. 1 provided 

additional support for the proposal and did not change the proposed rules of the original filing. 

 

https://www.sec.gov/comments/sr-cboe-2025-004/srcboe2025004.htm


2 

 

 

 

 

 

 

proposed rule change in its entirety. On June 2, 2025, the Commission published for comment 

the proposed rule change, as modified by Amendment No. 1, and instituted proceedings under 

Section 19(b)(2)(B) of the Act6 to determine whether to approve or disapprove the proposed rule 

change, as modified by Amendment No. 1.7 On July 23, 2025, the Exchange filed Amendment 

No. 2 to the proposed rule change, which supersedes the proposed rule change, as modified by 

Amendment No. 1, in its entirety.8 On August 28, 2025, the Commission designated a longer 

period for Commission action on the proposed rule change, as modified by Amendment No. 2.9 

The Commission is publishing this notice to solicit comments on Amendment No. 2 from 

interested persons, and is approving the proposed rule change, as modified by Amendment No. 2, 

on an accelerated basis.  

II. Description of the Proposal, as Modified by Amendment No. 210 

The Exchange proposes to amend Rules 4.13 (Series of Index Options), 5.1 (Trading 

Days and Hours), and 8.32 (Position Limits for Industry Index Options). First, the Exchange 

proposes to amend Rule 4.13(e), which governs its Nonstandard Expirations Program, to permit 

p.m.-settled options on CBTX and MBTX, which are narrow-based index options, that expire on: 

(1) any Monday, Tuesday, Wednesday, Thursday, or Friday (other than the third Friday-of-the-

                                                      
6  15 U.S.C. 78s(b)(2)(B).  

7  See Securities Exchange Act Release No. 103168 (June 2, 2025), 90 FR 24180 (June 6, 2025).  

8  Amendment No. 2 includes the changes made by Amendment No. 1 and also amends Rule 4.13, 

Interpretation and Policy .13, to add the defined term “P.M.-Settled Third Friday Index Options”, and 

modifies Rule 8.32(f) to add that positions in QIXs (defined below) and P.M.-Settled Third Friday Index 

Options will also be aggregated with positions in options contracts in the same index class. Amendment 

No. 2 is available at: https://www.sec.gov/comments/sr-cboe-2025-004/srcboe2025004-631167-

1867334.pdf. 

9  See Securities Exchange Act Release No. 103804 (Aug. 28, 2025), 90 FR 42645 (Sept. 3, 2025). The 

Commission designated October 31, 2025, as the date by which the Commission shall approve or 

disapprove the proposed rule change, as modified by Amendment No. 2.   

10  For a full description of the proposed rule change, refer to Amendment No. 2, supra note 8. 

https://www.sec.gov/comments/sr-cboe-2025-004/srcboe2025004-631167-1867334.pdf
https://www.sec.gov/comments/sr-cboe-2025-004/srcboe2025004-631167-1867334.pdf


3 

 

 

 

 

 

 

month (“Expiration Friday”) or on days that coincide with an end-of-month expiration) (“Weekly 

Expirations”) and (2) the last trading day of the month (“EOMs”). The Exchange also proposes 

to amend Rule 4.13(c), which governs quarterly index expirations, to add CBTX and MBTX 

options to the list of options in Rule 4.13(c) that are eligible for quarterly index expirations 

(“QIXs”). Further, the Exchange proposes to amend Rule 4.13, Interpretation and Policy .13, to 

permit the listing of p.m.-settled CBTX and MBTX options that expire on Expiration Fridays.  

In addition, the Exchange proposes to amend Rule 5.1(b)(2)(C) to provide that, on their 

last trading day, transactions in expiring CBTX and MBTX p.m.-settled options that expire on 

Expiration Fridays may be effected on the Exchange between 9:30 a.m. and 4:00 p.m. Eastern 

Time. 

Finally, the Exchange proposes to amend Rule 8.32(f) to provide that positions in 

Nonstandard Expirations Program series, QIXs, and p.m.-settled options listed pursuant to Rule 

4.13, Interpretation and Policy .13 will be aggregated with other options contracts in the same 

index class for purposes of position limits.  

Amendments to Rule 4.13 

Under the Exchange’s Nonstandard Expirations Program, the Exchange can currently list 

p.m.-settled Weekly Expirations and EOM expirations on any broad-based index eligible for 

standard options trading.11 New series in Weekly Expirations and EOM expirations may be 

added up to and including on the expiration date for expiring Weekly Expirations or EOM 

expirations.12 The Exchange proposes to expand the availability of Weekly Expirations and 

EOM expirations to CBTX and MBTX options, which are narrow-based index options that are 

                                                      
11  See Amendment No. 2, supra note 8, at 4. 

12  See id. at 5. 

 



4 

 

 

 

 

 

 

eligible for standard options trading.13 The Exchange states that the Nonstandard Expirations 

Program will apply to CBTX and MBTX options in the same manner as it currently applies to 

broad-based index options.14 Weekly Expirations and EOM expirations are subject to all 

provisions of Rule 4.13 and treated the same as options on the same underlying index that expire 

on Expiration Friday; provided, however, that Weekly Expirations and EOM expirations are 

p.m.-settled, and new series in Weekly Expirations and EOM expirations may be added up to and 

including on the expiration date for an expiring Weekly Expiration or EOM expiration.15  

The maximum number of expirations that may be listed for each Weekly Expiration in a 

given class is the same as the maximum number of expirations permitted in Rule 4.13(a)(2) for 

standard options on the same index.16 Weekly Expirations need not be for consecutive Monday, 

Tuesday, Wednesday, Thursday, or Friday expirations as applicable; however, the expiration 

date of a nonconsecutive expiration may not be beyond what would be considered the last 

expiration date if the maximum number of expirations were listed consecutively.17 Weekly 

Expirations that are first listed in a given class may expire up to four weeks from the actual 

listing date.18  

                                                      
13  See id. at 4. The Exchange states that these options are already eligible for the Monthly Options Series 

program pursuant to Rule 4.13(a)(2)(C), which permits p.m.-settled options that expire on the last trading 

day of the month (the same as EOM expirations). See id. at 4, n.3.  

14  See id. at 4. 

15  See id. at 4-5.  

16  See id. at 5. Currently, under Rule 4.13(a)(2), the Exchange may list up to six standard monthly expirations 

on CBTX and MBTX. See Cboe Rule 4.13(a)(2). The Exchange also proposes to delete the phrase “broad-

based” in several places in Rule 4.13(e), as the proposal would result in the provisions within that rule 

applying to indexes that are not broad-based. The Exchange states that it is not proposing to expand the 

Nonstandard Expirations Program to narrow-based indexes generally, but rather only to MBTX and CBTX 

options. See id. at 5, n.4. 

17  See id. at 5.  

18  See id. 

 



5 

 

 

 

 

 

 

Similar to Weekly Expirations, the maximum number of expirations that may be listed in 

a given class for each EOM expiration is the same as the maximum number of expirations 

permitted in Rule 4.13(a)(2) for standard options on the same index.19 EOM expirations need not 

be for consecutive end of month expirations; however, the expiration date of a non-consecutive 

expiration may not be beyond what would be considered the last expiration date if the maximum 

number of expirations were listed consecutively.20 EOM expirations that are first listed in a given 

class may expire up to four weeks from the actual listing date.21 If the Exchange lists EOM 

expirations and Weekly Expirations in a given class, the Exchange will list an EOM instead of a 

Weekly Expiration that expires on the same day in such class.22 Other expirations in the same 

class are not counted as part of the maximum number of Weekly Expirations or EOM expirations 

for an applicable index class.23  

The Exchange also proposes to amend Rule 4.13(c) to add CBTX and MBTX options to 

the list of options in Rule 4.13(c) that are eligible for the QIX program.24 The Exchange states 

that the QIX program will apply to CBTX and MBTX options in the same manner as it currently 

applies to the other options currently eligible for those expirations.25 Under the QIX program, the 

Exchange may open up to eight near-term quarterly expirations in a class.26 QIXs are subject to 

                                                      
19  See id. 

20  See id. 

21  See id. 

22  See id. at 5-6. 

23  See id. at 6. 

24  See id. QIXs are currently available for options on the S&P 100 Index, S&P 500 Index (“SPX options”), 

Mini-S&P 500 Index (“XSP options”), the Russell 2000 Index (“RUT options”), and Mini-Russell 2000 

Index (“MRUT options”). Id. 

25  See id. at 6-7. 

26  See id. at 6. 

 



6 

 

 

 

 

 

 

all provisions of Rule 4.13 and treated the same as options on the same underlying index that 

expire on Expiration Friday, except that QIXs are p.m.-settled.27  

Additionally, the Exchange proposes to amend Rule 4.13, Interpretation and Policy .13, 

to permit the listing of p.m.-settled CBTX and MBTX options that expire on Expiration 

Fridays.28 The Exchange states that CBTX and MBTX options that are p.m.-settled and expire on 

Expiration Fridays will be subject to all provisions of Rule 4.13 and treated the same as a.m.-

settled CBTX and MBTX options, except that they would be p.m.-settled.29 In combination with 

the proposed Weekly Expirations for CBTX and MBTX options, this proposed change would 

allow the Exchange to list p.m.-settled CBTX and MBTX options with expirations every day of 

the week.30  

Amendment to Rule 5.1 

The Exchange proposes to amend Rule 5.1(b)(2)(C) in conjunction with the proposed 

addition of CBTX and MBTX options that are p.m.-settled and expire on Expiration Friday.31 

The Exchange states that Rule 5.1(b)(2)(C) provides that on their last trading day, transactions in 

index options with Nonstandard Expirations, QIXs, as well as expiring p.m.-settled SPX, XSP, 

RUT, and MRUT options, may be effected on the Exchange between 9:30 a.m. and 4:00 p.m. 

                                                      
27  See id. at 7. The Exchange states that CBTX and MBTX options are currently eligible for the Quarterly 

Options Series program which permits p.m.-settled options that expire on the last trading day of the quarter 

(the same as QIXs). See id. at 6, n.5. 

28  See id. at 7. Pursuant to Rule 4.13, Interpretation and Policy .13, the Exchange is permitted to list p.m.-

settled SPX options, XSP options, RUT options, and MRUT options that expire on Expiration Fridays. 

Amendment No. 2 amends Interpretation and Policy .13, to define these expirations, as well as p.m.-settled 

CBTX and MBTX that expire on Expiration Fridays, as proposed, as “P.M.-Settled Third Friday Index 

Options.”  

29  See id. at 7.  

30  See id. 

31  See id. 

 



7 

 

 

 

 

 

 

Eastern Time.32 The proposed rule change amends Rule 5.1(b)(2)(C) to apply the provision to 

p.m.-settled CBTX and MBTX options that expire on Expiration Fridays.33  

Amendment to Rule 8.32 

The Exchange proposes to amend Rule 8.32(f) to provide that positions in the 

Nonstandard Expirations Program series, QIXs, and P.M.-Settled Third Friday Index Options 

will be aggregated with positions in options contracts in the same index class.34 For purposes of 

position limits, this proposed change would aggregate CBTX and MBTX options positions in the 

Nonstandard Expirations Program, QIX program, and with p.m.-settled Expiration Friday 

expirations with positions in CBTX and MBTX options, respectively, that have other 

expirations.35 This would be consistent with the treatment of positions for purposes of position 

limits for other classes that participate in the Nonstandard Expirations Program, QIX program, 

and with p.m.-settled Expiration Friday expirations.36 The Exchange adds that the exercise limits 

for index options (including CBTX and MBTX options) are equivalent to the position limits that 

are set forth in Rule 8.32.37 Therefore, the current position and exercise limits for CBTX and 

MBTX options are 24,000 contracts (and may not be more than 31,500 without rule changes).38  

In support of its proposal to amend the Nonstandard Expirations Program to expand the 

availability of Weekly Expirations to options on CBTX and MBTX, the Exchange states that it is 

                                                      
32  Regular trading hours for non-expiring options are 9:30 a.m. to 4:15 p.m. See id. at 7-8. 

33  See id. at 8. 

34  See id. at 12, n.13. Amendment No. 2 adds QIX and P.M.-Settled Third Friday Index Options to Rule 

8.32(f). The Exchange explains that these series were inadvertently omitted from the rule text. See id. at 3, 

12, n.13. 

35  See id. at 12, n.13.  

36  See id. See also Cboe Rule 8.31(b). 

37  See Amendment No. 2, supra note 8, at 12, n.13. 

38  See id. See also Cboe Rules 8.32(a) and 8.42(b). 

 



8 

 

 

 

 

 

 

currently permitted to list Weekly Expirations on options on any broad-based index that are 

eligible for standard trading under the Nonstandard Expirations Program and that the 

Nonstandard Expirations Program will apply to CBTX and MBTX options in the same manner.39 

In support of its proposal to permit the listing of p.m.-settled CBTX and MBTX options that 

expire on Expiration Friday, the Exchange states that it currently lists Expiration Friday p.m.-

settled options on broad-based indexes SPX, XSP, RUT and MRUT, and that p.m.-settled CBTX 

and MBTX options that expire on Expiration Fridays would be subject to all provisions of Rule 

4.13 and would be treated the same as a.m.-settled CBTX and MBTX options except for being 

p.m.-settled.40 The Exchange states that the addition of Weekly Expirations and p.m.-settled 

Expiration Friday expirations for CBTX and MBTX options would allow market participants “to 

purchase an option based on their needed timing and allow them to tailor their investment or 

hedging needs more effectively”41 as well as “more effectively manage overnight risk and trade 

out of their positions up until the contract settles.”42 Additionally, the Exchange states that there 

is sufficient investor interest and demand for these Weekly Expirations and Expiration Friday 

expirations.43  

 The Exchange explains that its proposal to amend its Nonstandard Expirations Program 

to expand the availability of EOM expirations to options on CBTX and MBTX would be 

consistent with the Exchange’s Monthly Options Series program, which already permits the 

listing of p.m.-settled options on CBTX and MBTX that expire on the last trading day of the 

                                                      
39  See Amendment No. 2, supra note 8, at 4. 

40  See id. at 7. 

41  See id. at 10. 

42  See id. 

43  See id. at 11. 

 



9 

 

 

 

 

 

 

month.44 Similarly, the Exchange proposes to make CBTX and MBTX options eligible for the 

QIX program and states that p.m.-settled CBTX and MBTX options with expiration on the last 

trading day of the quarter are already permitted under its Quarterly Options Series program.45 

III. Discussion and Commission Findings 

 

After careful review, the Commission finds that the proposed rule change, as modified by 

Amendment No. 2, is consistent with the Act and the rules and regulations thereunder applicable 

to a national securities exchange.46 In particular, the Commission finds that the proposed rule 

change, as modified by Amendment No. 2, is consistent with Section 6(b)(5) of the Act,47 which 

requires, among other things, that the Exchange’s rules be designed to prevent fraudulent and 

manipulative acts and practices, 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. 

In evaluating whether this proposal is consistent with Section 6(b)(5), and, in particular, 

whether it is designed to prevent fraudulent and manipulative acts and practices and to protect 

investors and the public interest, the Commission considered the potential impacts of p.m.-

settled, cash-settled options on the underlying cash equities markets, and in particular, the 

potential for added market volatility and sharp price movements near the close on expiration 

days. The Commission has had concerns about the adverse effects and impact of p.m.-settlement 

upon market volatility and the operation of fair and orderly markets on the underlying cash 

                                                      
44  See id. at 4, n.3. 

45  See id. at 4, n.5 and accompanying text. 

46  In approving this proposed rule change, as modified by Amendment No. 2, the Commission has considered 

the proposed rule’s impact on efficiency, competition, and capital formation. See 15 U.S.C. 78c(f). 

47  15 U.S.C. 78f(b)(5). 

 



10 

 

 

 

 

 

 

market at or near the close of trading on expiration days.48 However, the Commission approved 

proposals from several exchanges, including the Exchange, to permanently establish programs 

permitting the listing and trading of certain p.m.-settled broad-based index options.49 In 

approving these proposals, the Commission reviewed data provided by the exchanges in their 

filings, the exchanges’ pilot data and reports, as well as an analysis conducted at the direction of 

Staff from the Commission’s Division of Economic and Risk Analysis and concluded that 

analysis of the pilot data did not identify any significant economic impact on the underlying 

component securities surrounding the close as a result of expiring p.m.-settled options nor did it 

indicate a deterioration in market quality for an existing product when a new p.m.-settled 

expiration was introduced.50 Further, the Commission stated that significant changes in closing 

procedures in the decades since index options moved to a.m.-settlement may also serve to 

mitigate the potential impact of p.m.-settled index options on the underlying cash markets.51  

In support of its proposal, the Exchange states that it does not believe its proposal would 

adversely impact fair and orderly markets on expiration days.52 The Exchange explains that it has 

                                                      
48  See Securities Exchange Act Release No. 65256 (Sept. 2, 2011), 76 FR 55969, at 55972 (Sept. 9, 2011) 

(SR-C2-2011-008) (Order approving proposed rule change to establish a pilot program to list and trade 

SPXPM options on the C2 Options Exchange, Inc.).  

49  See e.g., Securities Exchange Act Release Nos. 98454 (Sept. 20, 2023), 88 FR 66103 (Sept. 26, 2023) (SR-

CBOE-2023-005) (“SPXPM Permanent Approval Order”); and 98455 (Sept. 20, 2023), 88 FR 66073 (Sept. 

26, 2023) (SR-CBOE-2023-019) (“XSPPM and MRUTPM Permanent Approval Order”). See also 

Securities Exchange Act Release Nos. 98450 (Sept. 20, 2023), 88 FR 66111 (Sept. 26, 2023) (SR-ISE-

2023-08) (Order Granting Approval of a Proposed Rule Change, as Modified by Amendment No. 1, to 

Make Permanent Certain P.M.-Settled Pilots) (“ISE Pilots Permanent Approval Order”); and 98451 (Sept. 

20, 2023), 88 FR 66088 (Sept. 26, 2023) (SR-PHLX-2023-07) (Order approving a nonstandard expirations 

pilot program and p.m.-settled XND options) (“Phlx Pilots Permanent Approval Order”). See also 

Securities Exchange Act Release Nos. 98935 (Nov. 14, 2023), 88 FR 80792 (Nov. 20, 2023) (SR-ISE-

2023-20) (Order approving the listing and trading of p.m.-settled Nasdaq-100 Index Options with a third 

Friday-of-the-month expiration) (“NDXPM Approval Order”). 

50  See e.g., XSPPM and MRUTPM Permanent Approval Order, 88 FR at 66075-76. 

51  See id. 

52  See Amendment No. 2, supra note 8, at 14. 

 



11 

 

 

 

 

 

 

not experienced any meaningful regulatory concerns, nor adverse impact on fair and orderly 

markets, in connection with its Nonstandard Expirations Program, Expiration Friday expirations, 

or QIX program, nor with the listing of p.m.-settled CBTX and MBTX options in the Quarterly 

Options Series and the Monthly Options Series, which, like the proposed QIXs and EOM 

expirations, are p.m.-settled and expire on the last trading day of the quarter and month, 

respectively.53  

Additionally, the Exchange states that p.m.-settlement is appropriate for CBTX and 

MBTX options for several reasons. According to the Exchange, the size of the markets of the 

underlying components,54 the weighting of the components, and the high correlation of these 

components make it unlikely the proposal would result in material impact on the component 

markets, the index value, or the broader market.55 Further, the Exchange states that CBTX and 

MBTX options trade within a complex where there are multiple other highly correlated 

instruments that all hold bitcoin available for hedging—such as options on the underlying 

components, shares of other exchange traded products that hold bitcoin, and bitcoin futures, in 

addition to the underlying components—and that this reduces the risk that listing these options 

would strain liquidity providers or materially impact the component markets, the index value, or 

the broader market.56  

                                                      
53  See id. 

54  According to the Exchange, as of April 15, 2025, the assets under management of the index components 

range from $130 million to $48 billion. See id. at 17, n.22. Further, according to the Exchange, the indexes 

underlying CBTX and MBTX options satisfy the generic listing criteria for narrow-based index options in 

Rule 4.10(b), which are designed to ensure that the trading markets for the components are adequately 

capitalized and sufficiently liquid, and that no one component dominates the index, thus minimizing the 

potential for manipulation. See id. at 19.  

55  See id. at 17. 

56  See id. 

 



12 

 

 

 

 

 

 

The proposals approved by the Commission permitted the listing and trading of certain 

p.m.-settled broad-based index options.57 This proposed rule change, as modified by Amendment 

No. 2, would permit the listing and trading of p.m.-settled index options for CBTX and MBTX. 

In evaluating the proposals permitting the listing and trading of other p.m.-settled index options, 

the Commission evaluated the potential for negative impacts on the underlying component 

securities of the indexes and options market quality.58 As noted above, the index components for 

CBTX and MBTX trade within a complex with multiple highly correlated instruments available 

for hedging, including the index components, options on the components, shares of other 

exchange-traded products holding spot bitcoin, and bitcoin futures. Further, the underlying 

components of the indexes are generally highly liquid and closely correlated with one another. 

As a result, it would be unlikely for p.m.-settled options on CBTX and MBTX to increase market 

and price volatility in the underlying index components or in the CBTX and MBTX options 

market.  

The Exchange’s proposal to expand the Nonstandard Expirations Program and the QIX 

program to CBTX and MBTX options, and make the options eligible for p.m.-settled Expiration 

Friday expirations, is a reasonably designed expansion of existing p.m.-settled index option 

programs that may provide the investing public and other market participants more flexible 

trading and hedging opportunities. Further, the proposed change to Rule 8.32(f) would aggregate 

positions in CBTX and MBTX options across expirations in the same class, which could reduce 

the potential incentives to manipulate or disrupt the underlying market to benefit the options 

                                                      
57  See e.g., SPXPM Permanent Approval Order; XSPPM and MRUTPM Permanent Approval Order; ISE 

Pilots Permanent Approval Order; and Phlx Pilots Permanent Approval Order. See also NDXPM Approval 

Order. 

58  See e.g., SPXPM Permanent Approval Order, 88 FR at 66106. 

 



13 

 

 

 

 

 

 

position and would not allow the maintenance of significant open interest in the options.59 The 

Exchange also has a surveillance program in place to monitor trading in the proposed p.m.-

settled options on CBTX and MBTX and systems capacity to support the proposed new options 

series.60 The Commission expects the Exchange to continue to monitor any potential risks from 

large p.m.-settled positions and take appropriate action on a timely basis if warranted.  

 For these reasons, the Commission finds that the proposed rule change, as modified by 

Amendment No. 2, is consistent with Section 6(b)(5) of the Act61 and the rules and regulations 

thereunder applicable to a national securities exchange.  

IV. Solicitation of Comments on Amendment No. 2 to the Proposed Rule Change  

Interested persons are invited to submit written data, views, and arguments concerning 

whether Amendment No. 2 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-CBOE-2025-004 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. 

                                                      
59  See Amendment No. 2, supra note 8, at 12, n.13. 

60  See id. at 11. 

61  15 U.S.C. 78f(b)(5). 

https://www.sec.gov/rules/sro.shtml
mailto:[email protected]


14 

 

 

 

 

 

 

All submissions should refer to file number SR-CBOE-2025-004. 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 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-2025-004 and should be submitted on or 

before [INSERT DATE 21 DAYS AFTER DATE OF PUBLICATION IN THE FEDERAL 

REGISTER]. 

V. Accelerated Approval of the Proposed Rule Change, as Modified by Amendment No. 2 

 

 The Commission finds good cause to approve the proposed rule change, as modified by 

Amendment No. 2, prior to the thirtieth day after the date of publication of notice of the filing of 

Amendment No. 2 in the Federal Register. In Amendment No. 2, the Exchange amends Rule 

4.13, Interpretation and Policy .13, to add the defined term “P.M.-Settled Third Friday Index 

Options”, modifies Rule 8.32(f) to add that positions in QIXs and P.M.-Settled Third Friday 

Index Options (which include CBTX and MBTX) will be aggregated with positions in options 

contracts in the same index class, and provides additional support for the proposal. The changes 

to the proposal in Amendment No. 2 ensure consistent treatment of positions in the proposed 

CBTX and MBTX QIXs and p.m.-settled Expiration Friday options with other options in the 

same index class and assist the Commission in evaluating the Exchange’s proposal and in 

determining that it is consistent with the Act. Accordingly, the Commission finds good cause, 

https://www.sec.gov/rules/sro.shtml


15 

 

 

 

 

 

 

pursuant to Section 19(b)(2) of the Act,62 to approve the proposed rule change, as modified by 

Amendment No. 2, on an accelerated basis. 

  

                                                      
62  15 U.S.C. 78s(b)(2).  



16 

 

 

 

 

 

 

VI. Conclusion 

 

IT IS THEREFORE ORDERED, pursuant to Section 19(b)(2) of the Act,63 that the 

proposed rule change (SR-CBOE-2025-004), as modified by Amendment No. 2, be and hereby 

is, approved on an accelerated basis. 

By the Commission. 

 

Stephanie J. Fouse, 

Assistant Secretary. 

 

 

                                                      
63  Id.