Nadex Self-Certification to Amend Market Maker Fees

On December 2, 2016, North American Derivatives Exchange, Inc. (“Nadex”, the “Exchange”) submitted to the Commodity Futures Trading Commission (the “Commission”), pursuant to Section 5c(c)(1) of the Commodity Exchange Act, as amended (“Act”), and section §40.6(a) of the regulations promulgated by the Commission under the Act (the “Regulations”), its intent to amend its Market Maker fees to include a “Wide Spread Surcharge”. Under the new structure, Market Makers would be assessed a 50% surcharge on the average per lot profit, in a given month, above $2.00. The purpose of the surcharge is to encourage narrower bid-offer spreads on Market Maker quotes to further promote quality trading opportunities for all participants, including increased liquidity in the market and a lower cost of trading for market participants, both of which should encourage increased overall trading activity, as well as greater competition among Market Makers. This surcharge would allow Market Makers to continue using current trading strategies if they so choose, or to narrow the bid-ask spreads they are making to avoid the additional fee and encourage increased trading on the exchange. Absent Commission objection, this submission will become effective December 19, 2016.

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