Self-Regulatory Organizations; MIAX Sapphire, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Adopt a New Selective Liquidity Auto Purge (“SLAP”) Feature

<NOTICE> SECURITIES AND EXCHANGE COMMISSION <DEPDOC>[Release No. 34-104372; File No. SR-SAPPHIRE-2025-42]</DEPDOC> <SUBJECT>Self-Regulatory Organizations; MIAX Sapphire, LLC; Notice of Filing and Immediate Effectiveness of a Proposed Rule Change To Adopt a New Selective Liquidity Auto Purge (“SLAP”) Feature</SUBJECT> <DATE>December 11, 2025.</DATE> Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934 (the “Act”), <SU>1</SU> <FTREF/> and Rule 19b-4 thereunder, <SU>2</SU> <FTREF/> notice is hereby given that on December 1, 2025, MIAX Sapphire, LLC (“MIAX Sapphire” or the “Exchange”) filed with the Securities and Exchange Commission (“Commission”) the proposed rule change as described in Items I and II below, which Items have been prepared by the Exchange. The Commission is publishing this notice to solicit comments on the proposed rule change from interested persons. <FTNT> <SU>1</SU>  15 U.S.C. 78s(b)(1). </FTNT> <FTNT> <SU>2</SU>  17 CFR 240.19b-4. </FTNT> <HD SOURCE="HD1">I. Self-Regulatory Organization's Statement of the Terms of Substance of the Proposed Rule Change</HD> The Exchange proposes to amend Exchange Rule 519C, Mass Cancellation of Trading Interest, to adopt new selective mass order cancellation functionality that will be available via the MEO Interface. <SU>3</SU> <FTREF/> <FTNT> <SU>3</SU>  The MIAX Express Order (MEO) Interface a messaging interface that MIAX Sapphire Members use to submit binary orders for trading on the Sapphire Options Market. <E T="03">See</E> MIAX Express Orders, Binary Orders for Trading Options, MEO Interface Specification, version 1.1e (8/13/2024), available online at <E T="03">https://www.miaxglobal.com/sites/default/files/job-files/Sapphire_MIAX_Express_Orders_MEO_v1.1e_0.pdf.</E> </FTNT> The text of the proposed rule change is available on the Exchange's website at <E T="03">https://www.miaxglobal.com/markets/us-options/miax-sapphire/rule-filings,</E> and at the Exchange's principal office. <HD SOURCE="HD1">II. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change</HD> In its filing with the Commission, the Exchange included statements concerning the purpose of and basis for the proposed rule change and discussed any comments it received on the proposed rule change. The text of these statements may be examined at the places specified in Item IV below. The Exchange has prepared summaries, set forth in sections A, B, and C below, of the most significant aspects of such statements. <HD SOURCE="HD2">A. Self-Regulatory Organization's Statement of the Purpose of, and Statutory Basis for, the Proposed Rule Change</HD> <HD SOURCE="HD3">1. Purpose</HD> The Exchange proposes to amend Rule 519C, Mass Cancellation of Trading Interest, to adopt a new Selective Liquidity Auto Purge (“SLAP”) feature, which provides more granular mass cancellation functionality. Currently, Members  <SU>4</SU> <FTREF/> may submit a mass cancellation request via the MEO Interface using the Liquidity Mass Cancel Request message. The Liquidity Mass Cancel Request message contains a Mass Cancel Scope field which allows the Member to determine the behavior following the mass cancellation of orders. For example, populating the Mass Cancel Scope field with an “A” will instruct the System  <SU>5</SU> <FTREF/> to cancel all open binary orders and block all subsequent binary orders (including immediate orders); populating the field with a “D” will instruct the System to cancel all open binary orders and block all subsequent binary orders (excluding immediate orders). <SU>6</SU> <FTREF/> <FTNT> <SU>4</SU>  The term “Member” means an individual or organization that is registered with the Exchange pursuant to Chapter II of the MIAX Sapphire Options Exchange Rulebook for purposes of trading on the Exchange as an “Electronic Exchange Member” or “Market Maker.” Members are deemed “members” under the Exchange Act. <E T="03">See</E> Exchange Rule 100. </FTNT> <FTNT> <SU>5</SU>  The term “System” means the automated trading system used by the Exchange for the trading of securities. <E T="03">See</E> Exchange Rule 100. </FTNT> <FTNT> <SU>6</SU>   <E T="03">See</E> Section 4.1.5, Liquidity Mass Cancel Request, in the MIAX Express Orders, Binary Orders for Trading Options, MEO Interface Specification, version 1.1e (8/13/2024), available online at <E T="03">https://www.miaxglobal.com/sites/default/files/job-files/Sapphire_MIAX_Express_Orders_MEO_v1.1e_0.pdf.</E> </FTNT> The Exchange now proposes to adopt new paragraph (e) to Exchange Rule 519C, to adopt the SLAP feature. The SLAP feature, the use of which is optional, will provide more granular mass cancellation functionality by allowing users to mass cancel specific groups of orders as determined by the Member on an order-by-order basis. Orders submitted via the MEO Interface may optionally contain one or more SLAP codes from 1 through 8. <SU>7</SU> <FTREF/> Each individual order can be part of eight (8) unique SLAP groups identified by their SLAP code (numbered 1 through 8). <SU>8</SU> <FTREF/> <FTNT> <SU>7</SU>  Orders may contain multiple SLAP codes. </FTNT> <FTNT> <SU>8</SU>  The Exchange notes that there is no limit on the number of orders that may be included in a SLAP group. </FTNT> To remove orders with a SLAP code, a SLAP request is sent to the System containing the MPID, <SU>9</SU> <FTREF/> underlying, and SLAP code of the orders to be removed from the System. Following completion of processing the SLAP request all new inbound orders with matching criteria submitted to the System will be blocked. The System will provide a notification to the requestor upon receipt of the SLAP request and another upon completion of the SLAP request. A SLAP reset request must be submitted to the System to resume entry of orders for the same MPID, underlying, and SLAP code. Orders received for the same MPID, underlying, and SLAP code prior to a SLAP reset will be rejected. Intermarket Sweep Orders  <SU>10</SU> <FTREF/> and orders with a time in force of immediate-or-cancel (“IOC”)  <SU>11</SU> <FTREF/> will not be eligible to receive a SLAP code. <FTNT> <SU>9</SU>  The term “MPID” means unique market participant identifier. <E T="03">See</E> Exchange Rule 100. </FTNT> <FTNT> <SU>10</SU>  An Intermarket Sweep Order or “ISO”, as defined in Rule 1400(i), is a limit order that is designated by a Member as an ISO in the manner prescribed by the Exchange, and is executed within the System by Members without respect to Protected Quotations of other Eligible Exchanges as defined in Rule 1400(q) and (g). ISOs are immediately executable within the System and shall not be eligible for routing. ISOs that are not designated as immediate or cancel will be cancelled by the System if not executed upon receipt. Simultaneously with the routing of an ISO to the System, one or more additional limit orders, as necessary, are routed by the entering Member to execute against the full displayed size of any Protected Bid or Protected Offer, as defined in Rule 1400(p), in the case of a limit order to sell or buy with a price that is superior to the limit price of the limit order identified as an ISO. These additional routed orders must be identified as ISOs. An ISO is not valid during the Opening Process described in Rule 503. <E T="03">See</E> Exchange Rule 516(f). </FTNT> <FTNT> <SU>11</SU>  An immediate-or-cancel order is an order that is to be executed in whole or in part upon receipt. Any portion not so executed is cancelled. An immediate-or-cancel order is not valid during the Opening Process described in Rule 503. <E T="03">See</E> Exchange Rule 516(e). </FTNT> To facilitate SLAP processing the Exchange has amended and enhanced existing MEO messages. Specifically, Members will use the Standard Order—New message in MEO to send an order to the System. A new field, “SLAP Codes,” has been added to the message, which will allow the Member to identify the order with a SLAP Code of 1 through 8, as desired. A Member will use the Liquidity Mass Cancel Request message in MEO to remove orders with the designated SLAP Code. The Mass Cancel Scope field of the Liquidity Mass Cancel Request message has been enhanced to include new value “S” to indicate that the Liquidity Mass Cancel Request is a Selective Liquidity Auto Purge (“SLAP request”). The Liquidity Mass Cancel Request message also includes the corresponding field, “SLAP Codes,” for Members to identify the SLAP Codes of the orders that are being cancelled. The System will notify the Member that the SLAP request has been received by providing the Member with a new SLAP Protection Trigger Notification message. The System will then notify the Member that the SLAP request has been processed using the existing Liquidity Mass Cancel Response message. Additionally, the Liquidity Mass Cancel Response message has been modified to include new responses specifically related to SLAP requests to provide Members with more specific information regarding the status of their SLAP request should it not be successfully executed. The Member will submit the existing Liquidity Protection Reset Request message to re-enable the System to process orders with a SLAP code. The Liquidity Protection Reset Request message has been enhanced to include a “Scope” field where a value of “S” indicates the reset is for SLAP. Additionally, the Liquidity Protect Reset Request message includes a SLAP Codes field to allow a reset for specific SLAP code groups. The SLAP code is an additional, optional, field in the Standard Order—New message and as such Members may (i) include a SLAP code on an order; (ii) modify an order that does not contain a SLAP code to assign a SLAP code; (iii) modify an order that has a SLAP code to c ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 25k characters. Full document text is stored and available for version comparison. ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━