Federal Register #SR-MEMX-2026-25

SEC Review of MEMX LLC Proposal for Securities Event Contracts

This opportunity centers on a regulatory proposal by MEMX LLC for new securities event contracts: - Government buyer: Securities and Exchange Commission (SEC) - Vendor/OEM: MEMX LLC (self-regulatory organization and exchange operator) - Products/services requested: - Securities event contracts: cash-settled, European-style binary options based on issuer financial metrics (e.g., earnings, revenues, sales) - No specific part numbers or quantities; the proposal outlines contract terms and trading framework - Notable requirements: - Contracts feature a fixed $1 payout, no contract multiplier, and binary yes/no outcomes - Rules cover contract terms, expiration, exercise prices, trading mechanics, adjustments, resolution, and position limits - Designed to provide targeted exposure to issuer-specific financial events within a regulated exchange - The SEC is soliciting public comments on the proposed rule change, not procuring products or services - Proposal aims to integrate these contracts into the established regulatory infrastructure for listed options, including exchange trading, surveillance, standardized disclosure, and centralized clearance and settlement

Description

The Securities and Exchange Commission has filed a notice regarding a proposal by MEMX LLC to adopt rules for the listing and trading of securities event contracts on their exchange. The proposal involves adopting new Chapter 30 of the Exchange Rules to provide for the listing and trading of securities event contracts as standardized options on the MEMX Options platform. These contracts are cash-settled, European-style binary options based on the outcome of an event related to the financial performance of an issuer of an NMS stock. The proposal aims to provide more tailored investment and hedging opportunities for investors and to bring these products within the established regulatory infrastructure applicable to listed options.

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