Comment Letter Roundup (Summer 2026)

Robinhood’s policy and regulatory teams were very active this past summer. In case you missed it, we filed 8 comment letters to federal regulators across agencies including the SEC and CFTC, as well as FINRA. Here's a breakdown of what they say, why they are important, and how the proposed changes could affect retail investors.

Modernizing the Consolidated Audit Trail (CAT)

File Number S7-2026-21, Concept Release on Consolidated Audit Trail and Other Audit Trails and Data Sources: In June, we filed a letter on the SEC’s review of the Consolidated Audit Trail or “CAT”, the system regulators use to monitor trading across markets. CAT’s annual costs have more than quadrupled, from an estimated $55 million to over $248 million a year. We asked the SEC to fund CAT in a way that no longer passes those costs to investors. We also asked the SEC to retire the older, less secure system CAT was meant to replace and to provide CAT data in ways that benefit investors and the markets. A leaner, more transparent system will help protect investors without increasing costs.  

Protecting Investors as Overnight Trading Expands 

Securities Exchange Act Release No. 34-105596; File No. 4-631 Joint Industry Plan; Notice of Filing of the Twenty-Seventh Amendment to the National Market System Plan To Address Extraordinary Market Volatility To Establish Temporary Price Band Protections in Overnight Trading: In August, we filed a letter on the expansion of overnight trading as several national securities exchanges are preparing to launch overnight trading sessions. We flagged an issue regarding how price band protections, which prevent trades from executing at extreme prices, will apply to those new sessions. New protections should correspond with existing procedures used by market participants in overnight trading and building off the existing framework will help expand overnight trading for retail investors. 

Extending Portfolio Margining to Retail Investors

Release No. 34-105781; File Number S7-2026-23; Joint Request for Comment on Further Implementation of Portfolio Margining and Cross-Margining of Securities and Derivatives: In August, we responded to the SEC and CFTC’s joint request for comment on portfolio margining. Portfolio margining is the margining of related positions in a single account, allowing netting of certain offsetting risks, which frees up capital for other uses. Today, firms are required to set a minimum equity requirement of at least $100,000 before investors can qualify for this benefit. We recommended that the Commissions base eligibility on the investor’s portfolio rather than their account size. Extending these benefits to retail investors, with the right safeguards in place, can help free up capital and give retail investors more efficient ways to manage risk in their portfolio. 

Simplifying Market Structure to Reduce Costs for Investors 

Release No. 34-105655; File No. S7-2026-20; The Trade-Through Rule and Locked and Crossed Markets Provisions of Regulation NMS: In August, we supported the SEC’s proposal to eliminate Rule 611, which is a significant part of the SEC’s regulatory framework governing the U.S. stock market . Removing this rule is intended to simplify equity market structure, reduce costs, and promote competition and innovation. Rule 611 gave stock exchanges “protected quotation” status to encourage them to display liquidity, but it was adopted in 2005 for a market structure that no longer exists. Since then it has had unintended impacts like encouraging the proliferation of exchanges, adding cost and complexity, and fragmenting the markets. Importantly, eliminating Rule 611 doesn’t remove investor protections because the duty of best execution will continue to ensure that retail investors get high quality trade executions. A simpler market structure means lower costs and less complexity for retail investors, while best execution requirements keep core protections in place.      

Expanding Binary Options to Business KPIs

Notice of Filing of a Proposed Rule: In August, Robinhood supported Cboe’s proposal to list binary options on companies’ key performance indicators — cash-settled options that pay out based on whether a company’s revenue, EPS, or a similar metric clears a set threshold. These KPI options close a real gap: today, retail investors can only trade earnings-specific risk through standard equity options, whose price bundles in volatility and time value that may have nothing to do with the metric an investor actually cares about.

Setting Standards for Event Contract Review

Notice of Proposed Rulemaking Relating to Prediction Markets; Public Interest Determinations:  In July, Robinhood Derivatives commented on the CFTC’s proposed changes to Rule 40.11, which sets the standard for when the agency can review, and potentially prohibit, an event contract tied to certain enumerated activities, including gaming. We supported the proposal and urged the Commission to first identify concrete harm, then weigh that harm against a contract’s price-discovery and hedging benefits, rather than weighing everything at once. We also asked for a safe harbor for contracts on aggregate sports outcomes, and for retail customers to get the same protections whether they access these markets through a broker or directly on an exchange. If adopted, these changes will give retail customers greater certainty that the prediction-markets products they already use are here to stay.

Bringing Clarity To Event Contract Jurisdiction

Joint Request for Comment on Further Definition of “Swap” and “Security-Based Swap” and on Alternative Compliance (RIN 3038–AF71; File No. S7–2026–21): In August, Robinhood Derivatives responded to a joint CFTC/SEC request to clarify when event contracts tied to a company’s financial results fall under SEC or CFTC jurisdiction. We urged the Commissions to adopt clear, objective standards so exchanges and brokers can classify a product with certainty before listing, rather than argue about it after the fact. Clear rules like this give market participants the confidence that they’re operating within the correct regulatory framework, so they can list, and retail investors can trade, these important contracts.

Modernizing Futures for a 24/7 World 

Request for Comment on the Extension of Standard Futures Contracts to 24/7 Trading and on Perpetual Contracts Referencing Physically Delivered or Storable Energy Commodities, RIN 3038-AF75: In August, Robinhood Derivatives responded to the CFTC’s request for comment on two ideas: letting standard futures trade around the clock, and allowing “perpetual” futures — contracts with no fixed expiration date — on physical energy commodities. We supported both, and urged the Commission to rely on objective, data-driven standards, like proven off-hours liquidity, rather than blanket bans, and to let pre-positioned collateral cover off-hours margin calls rather than requiring a fully built 24/7 payment system first. Removing the fixed expiration date on perpetuals eliminates two real costs retail investors bear today: rollover risk at expiration, and the risk of a forced liquidation or delivery obligation they can’t satisfy. We recommended clear disclosure and an appropriateness check, not a blanket restriction limiting these products to institutions. Our preferred result for retail customers: the ability to trade around weekend news and hold continuous commodity exposure, without the structural traps of the legacy futures calendar.

We’re focused on expanding ownership in our efforts to democratize finance for all and submitting written comment letters to regulators helps ensure that the perspective of retail is included in these important conversations. Across these letters, we advocate for clear rules that lower costs and broaden opportunities for retail investors while preserving core investor protections. For more, check out the Comment Letter tab on our Public Policy Page.