What changed in this filing

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Item 1. Business

2023-02-27 compared with 2022-02-25 · 133 added, 111 removed, 309 unchanged (44% of the section changed)

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CME was founded in 1898 as a not-for-profit corporation.

It established CME Clearing in 1919, which is operated as part of CME.

It established its clearing house in 1919, which is operated as part of CME.

CME demutualized in 2000, and in 2002 its parent company, CME Group, completed an initial public offering of its Class A common stock (Nasdaq:

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• CME's product slate includes agricultural, equities, FX, cryptocurrencies/alternative investments and interest rate products, including Eurodollar futures and options, Secured Overnight Financing Rate (SOFR) futures and options, Bloomberg Short-Term Bank Yield (BSBY), livestock and cash-settled contracts based on the S&P 500, including the E-mini S&P 500 ESG (Environmental, Social and Governance) contract, Micro E-mini Equity Index contracts, Nasdaq-100, FTSE Russell and Bitcoin and Ether Reference Rate.

• CBOT's product slate consists of agricultural, equities and interest rate products, including contracts for United States (U.S.) Treasury futures, soybean, corn, wheat and contracts based on the Dow Jones Industrial Index.

• NYMEX's product slate consists of energy and metals products, including contracts for crude oil, natural gas, heating oil, gasoline and emissions contracts (GEO and NGO).

• CBOT's product slate consists of agricultural, equities and interest rate products, including contracts for United States (U.S.) Treasury futures, soybean, corn, and wheat and contracts based on the Dow Jones Industrial Index.

• NYMEX's product slate consists of energy and metals products, including contracts for crude oil, natural gas, heating oil, gasoline and emissions (GEO and NGO).

• COMEX's product slate consists of metals products, including contracts for gold, silver, copper and other base metals.

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CME Group products are traded primarily through CME Globex, as well as by open outcry in Chicago for Eurodollar options and SOFR options and through privately negotiated transactions.

Due to the COVID-19 pandemic, in March 2020 we closed our open outcry trading floor and reopened it in August 2020 for Eurodollar options.

In May 2021, we announced our decision to permanently close the trading floor outside of Eurodollar options and SOFR options.

We strive to provide the most flexible and scalable platforms to support the operational and capacity needs of our business along with the delivery of innovative technology solutions to the marketplace.

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The CME Globex platform is accessible through a wide variety of vendor-provided and custom-built trading systems that benefit from our open application programming interface approach.

For electronic and privately negotiated

markets, we offer brokers and customers the CME Direct platform for arranging, executing, recording and risk-managing trades across all six major asset classes.

For electronic and privately negotiated markets, we offer brokers and customers the CME Direct platform for arranging, executing, recording and risk-managing trades across all six major asset classes.

We also provide the functionality to connect to CME Direct on a mobile device through our CME Direct Mobile application with full trading and on-the-go order management capabilities.

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The CME ClearPort front-end system provides access to our flexible clearing services for block transactions, bi-lateral trades and swaps.

In 2021, we launched the derivatives industry’s first Sustainable Clearing service to help market participants track and report how their hedging activities are advancing their sustainability goals.

The majority of clearing and transaction fees received from clearing firms represents charges for trades executed and cleared on behalf of their customers.

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Our cash markets business is comprised of BrokerTec and EBS.

Certain BrokerTec and EBS contracts are cleared at third-party clearing houses.

Certain BrokerTec and EBS products are cleared at third-party clearing houses.

BrokerTec and EBS offer anonymous and disclosed trading venues, offering clients multiple execution and distribution options and the benefit of an established and far-reaching distribution network of liquidity providers and consumers.

Our BrokerTec markets were migrated from a third-party platform to our CME Globex electronic platform in the first quarter of 2021 and our EBS market is expected to migrate to the CME Globex platform in the first half of 2022.

Our BrokerTec Central Limit Order Books were migrated from a third-party platform to our CME Globex electronic platform in the first quarter of 2021 and our EBS Central Limit Order Books were migrated to the CME Globex platform in the second quarter of 2022.

• BrokerTec operates global electronic trading for fixed income products on the CME Globex platform, with a leading position in cash U.S.

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repo fixed income instruments and European Government Bonds.

It facilitates trading principally for banks and non-bank professional trading firms.

• EBS is a global electronic platform for the trading of FX products across major and emerging market currencies.

EBS also offers execution of non-deliverable forwards through a Commodity Futures Trading Commission (CFTC) registered swap execution facility (SEF).

EBS operates both as a Central Limit Order Book platform (EBS Market) for

spot and non-deliverable forwards currency pairs, as well as a relationship-based trading platform offering spot FX, FX forwards and FX swaps (EBS Direct).

It facilitates trading for banks and non-bank professional trading firms.

BrokerTec Quote is a third party Request For Quote platform that offers a dealer-to-client trading solution for the European and U.S.

government repo markets.

BrokerTec Stream is a relationship-based trading platform offering U.S.

Treasury instruments.

• EBS provides for the trading of FX products across major and emerging market currencies.

EBS also offers execution of non-deliverable forwards through a Commodity Futures Trading Commission (CFTC) registered swap execution facility (SEF), operated by one of our subsidiaries.

EBS operates both as a Central Limit Order Book platform for spot and non-deliverable forwards currency pairs, as well as a relationship-based third-party trading platform offering spot FX, FX forwards and FX swaps.

Market Data Business:

We offer a variety of market data services through industry-leading market data platforms and third-party distribution partners, which are designed to meet the risk-management, trading, investment and business needs of our global client base.

global client base.

As such, we provide proprietary real-time and historical market data related to CME Group’s vibrant and deeply liquid exchanges and cash markets businesses.

We further offer derived cash markets pricing, third-party and alternative data sets, as well as a wide range of analytic tools.

As customers continue to leverage cloud technology to improve and evolve their businesses, CME Group has taken a leading role by becoming the first derivatives marketplace to provide live market data natively in the cloud with the launch of our cloud connect capabilities on Google Cloud Platform.

CME Group is also the distributor of leading benchmark equity and commodity indices on behalf of third parties as well as our own proprietary benchmarks and indices.

CME Group is also the distributor of leading benchmark equity and commodity indices on behalf of third parties as well as our own proprietary benchmarks and indices, including CME Term SOFR Reference Rates (CME Term SOFR), which is a benchmark designed to adhere to the IOSCO Principles for Financial Benchmarks.

Our Strategic Initiatives

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We have further focused on building upon cloud-based data distribution capabilities as a more flexible and potentially cost-effective means of providing data to our clients.

In 2021, CME Group futures and options had an average daily volume of 19.6 million contracts, with a volume record in our equity asset class for the sixth consecutive year.

It was also a year of volume records for multiple products, including Ultra 10 Year futures, SOFR futures, Bitcoin futures, Micro E-Mini Equity Index futures and a record number of contracts executed via Basis Trade at Index Close.

In 2022, CME Group futures and options had an average daily volume of 23.3 million contracts, with a volume record in our equity asset class for the seventh consecutive year.

It was also a year of volume records for multiple products, including Ultra 10 Year Treasury Note futures, SOFR futures, Bitcoin futures, Micro E-Mini Equity Index futures and a record number of contracts executed via Basis Trade at Index Close.

We set records in the volume traded for our Micro E-Mini Equity Index futures in total, as well as for each of the Micro E-Mini Nasdaq-100, Russell 2000 and Dow 30 contracts.

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Some of our products introduced over the past two years include:

• 3-Year Treasury Note Futures (2020)

• Adjusted Interest Rate (AIR) Total Return Futures (2020)

• Cash-settled Bitcoin Options (2020)

• SOFR Options (2020)

• Micro E-mini Equity Index Options (2020)

• Brazilian Soybean Futures (2020)

• Pork Cutout Futures and Options (2020)

• European Renewable Fuel Futures (2020)

• Nasdaq-100 Volatility Index (VOLQ) Futures (2020)

• Nasdaq Veles California Water Index Futures (2020)

• Adjusted Interest Rate Total Return Futures (2020)

• E-mini Nasdaq 100 Weekly Options (2021)

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• Global Emissions Offset (GEO) and Nature-based Global Emissions Offset (N-GEO) Futures (2021)

In addition to the individual product launches noted above, we have completed many product extensions across our asset classes, including short-dated options products (Monday and Wednesday weekly options on the E-Mini Nasdaq 100 and Russell 2000), expanded Japanese energy futures (including four new Japanese electricity futures contracts and two new LNG futures contracts), and additional implied volatility products in fixed income, energy, metals and agricultural products to our suite of CME Group Volatility Indexes (CVOL).

• Additional Cryptocurrency Reference Rates and Real-Time Indices (2022)

• CBL Core Global Emissions Offset Futures (2022)

• 20-year U.S.

Treasury Bond Futures (2022)

• Micro Bitcoin and Ether Options (2022)

• Aluminum Options (2022)

• Canadian Wheat Futures (2022)

• Micro WTI Options (2022)

• Six new E-mini sector index Futures (2022)

• Euro-denominated Bitcoin and Ether Futures (2022)

• Ether Options (2022)

• Ten event contracts linked to our global benchmarks (2022)

• TBA futures for Mortgage-backed Securities (2022)

• Euro Short-Term Rate (€STR) Futures and RepoFunds Rate (RFR) Futures (2022)

We continue to expand and deepen our customer base worldwide and offer customers around the world with the most broad and diversified portfolio of benchmark products.

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In 2022, approximately 28% of our electronic

futures and options volume was from transactions reported as outside the U.S.

futures an d options volume was from transactions reported as outside the U.S.

and approximately 52% of our market data revenue was derived from outside the U.S.

We also achieved 27% growth in trading volume during Asian trading hours and 10% growth during European trading hours in 2022 compared to 2021.

CME Group is also the distributor of leading benchmark equity and commodity indices on behalf of third parties, as well as our own proprietary benchmarks and indices including CME Term SOFR.

CME Group continues to introduce tools which assist our clients in managing their risks.

In 2021, we updated the FX Market Profile Tool and launched a Metals Market Profile and, in 2022, we launched an UST Market Profile.

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Our CME Liquidity Tool enables market participants to analyze liquidity across CME Group products during U.S., London or Singapore trading hours and was expanded to 37 products in 2021 to meet customer demand for our growing product suite.

To further our commitment to our global customers, in 2020, we introduced a TreasuryWatch Tool and additional tools to help customers and prospective customers identify key marketplace developments and potential risk management and trading opportunities (e.g., SOFR-LIBOR spread).

In 2021, we extended our new CVOL family with two additional releases for a total of 40 indexes, including six unique broad-based benchmarks such as the Treasury Volatility Index and Commodity Volatility Index.

We also introduced an initiative to launch real-time streaming versions of the CVOL indexes, which is expected to occur in 2022.

We have increased our customer base and continue to target cross-asset sales across client segments, driving global sales and generating new client participation across all regions.

CME Group Volatility Indexes (CVOL) comprises a total of 39 indexes, including six unique broad-based benchmarks such as the Treasury Volatility Index and Commodity Volatility Index.

In 2022, we launched real-time streaming versions of the CVOL indexes.

CVOL provide a representative measure of the market expectation of 30-day forward risk, comprising both end of day and live streaming values.

We have increased our customer base and continue to target cross-asset sales across client segments and across cash and futures platforms, driving global sales and generating new client participation across all regions.

We have a long history of providing customer value and responsiveness and believe our products and services position us to help our customers adapt to and comply with new regulations, while enabling them to efficiently manage their risks.

We have a broad distribution network comprised of a combination of internal and external channels and proprietary front-end capabilities.

Diversify our Business and Revenue - Our acquisition of NEX strengthened our role in global financial markets infrastructure and information services, adding complementary cash and OTC businesses and scale to our listed interest rate and FX products, while broadening our global client base.

We are positioned to take direct advantage of growth in treasury issuance, liquid treasury holdings and the trading of treasury instruments, as well as growing repo activity in the U.S.

Diversify our Business and Revenue - Our acquisition of NEX in 2018 strengthened our role in global financial markets infrastructure and information services, adding complementary cash and OTC businesses and scale to our listed interest rate and FX products, while broadening our global client base.

We are positioned to take direct advantage of growth in treasury issuance, unwinding of the Fed’s balance sheet, liquid treasury holdings and the trading of treasury instruments, as well as growing repo activity in the U.S.

The transaction expanded CME Group’s position in the large, highly competitive and highly fragmented global FX marketplace, offering both order book trading and relationship-based trading solutions for customers.

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The ARRC formalized this recommendation in July 2021.

We are working closely with our customers during this transition, and we will continue to offer capital-efficient choices to manage risk via Eurodollar, 30-Day Federal Fund, SOFR and SONIA futures, as well as SOFR- and SONIA-based cleared OTC swaps.

We are also licensing the CME Term SOFR rate to third parties.

Our joint venture with S&P Global, Inc., S&P/DJI Indices LLC, combines the world class capabilities of the S&P and Dow Jones Indices, and is a significant player in passive investing, including the exchange-traded fund (ETF) industry value chain.

Through the end of 2022, we have licensed the CME Term SOFR to over 1,900 firms and over 7,000 users in more than 90 countries.

In 2010, CME Group acquired a majority stake in Dow Jones Indexes, which was combined with S&P’s index business in 2012 to form S&P Dow Jones Indices LLC, of which CME Group now has a 27% ownership stake.

S&P Dow Jones Indices LLC combines the world class capabilities of the S&P and Dow Jones Indices, and is a significant player in passive investing, including the exchange-traded fund (ETF) industry value chain.

As part of the joint venture, we acquired a long-term, ownership-linked, exclusive license to list futures and options based on the S&P 500 Index and certain other S&P indices.

We also act as the joint ventures' licensing agent and distribution services provider.

In September 2021, we completed the establishment of OSTTRA, a 50/50 joint venture with IHS Markit that combines our post-trade services business (Traiana, TriOptima and Reset) and IHS Markit’s MarkitSERV, and serves as a leading provider of progressive post-trade solutions for the global OTC markets across interest rate, FX, equity and credit asset classes.

In connection with the establishment of OSTTRA, we contributed the net assets of our post-trade services business to the joint venture in exchange for cash and a 50% equity interest in the company.

Deliver Unparalleled Customer Efficiencies and Operational Excellence - With changing regulatory capital requirements for many of our customers, including additional margin requirements on uncleared trades, and the need for greater efficiencies, we have added tools to enable customers to manage trading and clearing positions in our markets in an efficient manner.

With the ongoing implementation of regulatory reform in the U.S.

and in Europe, along with global implementation of Basel III capital requirements on financial institutions, we expect capital efficiencies and centralized clearing to continue to be important for our global client base.

We also act as the joint venture's licensing agent and distribution services provider.

In 2022, we invested $410.0 million in this joint venture to fund our portion of the acquisition of the IHS Markit indices business, which includes leading fixed income and credit indices, such as iBoxx, iTraxx and CDX.

In 2021, CME Group and IHS Markit established a 50/50 joint venture, OSTTRA.

We contributed to OSTTRA our post-trade businesses (Traiana, TriOptima and Reset) and IHS Markit contributed its MarkitSERV business.

OSTTRA serves as the leading optimization business and provider of progressive post-trade solutions for the global OTC markets across interest rate, FX, equity and credit asset classes.

In February 2022, IHS Markit was acquired by S&P Global.

Deliver Unparalleled Customer Efficiencies and Operational Excellence - With changing regulatory requirements for many of our customers, including additional margin requirements on uncleared trades, and the need for greater efficiencies, we have added tools to enable customers to manage clearing positions in our markets in an efficient manner.

With the ongoing implementation of regulatory reform in the United States and in Europe, along with global implementation of Basel III capital requirements on financial institutions, we expect centralized clearing and capital efficiencies to continue to be important for our global client base.

We provide a comprehensive multi-asset class clearing solution to market participants for maximum operational ease and the capital efficiency that comes with connecting to our clearing house.

Our clearing services offer the ability to optimize collateral

and capital efficiencies across portfolios within the clearing house while meeting the heightened regulatory requirements on derivatives.

The majority of our clearing volumes and activities are related to our listed futures and options, which represents the majority of our open interest and collateral held against these positions.

Our clearing services offer the ability to optimize collateral and capital efficiencies across portfolios within the clearing house while meeting the heightened regulatory requirements on derivatives.

The majority of our clearing volumes and activities are related to our listed futures and options, which represents

the majority of our open interest and collateral held against these positions.

We also offer clearing services for OTC interest rate swaps, FX forwards and commodity swaps.

The addition of our enhanced Standard Portfolio Analysis of Risk (SPAN) margin framework, CME SPAN 2, will provide enhanced risk management capabilities in a single, unified interface by maintaining SPAN's current calculations and functions while incorporating several new modeling, reporting and margin replication enhancements.

CME SPAN 2 will initially be launched with certain futures and options on energy products and then expanded to other asset classes.

As CME SPAN 2 is implemented, margins for diversified portfolios will consist of products using the enhanced CME SPAN 2 framework in addition to the existing SPAN framework, ensuring appropriate levels of offsets will continue to be provided across products subject to the SPAN and SPAN 2 frameworks.

CME Group provides various tools and services to assist customers with capital and operational efficiencies, including:

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The partnership will focus on expanding access to CME Group’s infrastructure, advancing real-time data and analytics capabilities, co-innovating new products and services, increasing efficiencies and driving resiliency in the financial markets’ ecosystem.

2022 was a foundational year, where we built the Cloud platform and successfully migrated some applications.

In 2023, we plan to accelerate our application migration, including launching and commercializing data products in the Cloud.

Patents, Trademarks and Licenses

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We protect our intellectual property rights by relying on trademarks, patents, copyrights, database rights, trade secrets, restrictions on disclosure and other methods.

We offer equity index futures and options on key benchmarks, including S&P, Nasdaq, Dow Jones, FTSE Russell and fixed income index futures on the Bloomberg Short-Term Bank Yield (BSBY) indexes.

We offer equity index futures and options on key benchmarks, including S&P, Nasdaq, Dow Jones, FTSE Russell and fixed income index futures on the BSBY indexes.

These products are listed by us subject to license agreements with the applicable owners of the indexes, some of which are exclusive.

In connection with our joint venture with S&P Global, Inc., we have a license agreement (S&P License Agreement), which superseded our prior licensing arrangements and was assigned to the joint venture.

CME’s license for the S&P 500 Index will be exclusive for futures and options until one year prior to the termination of the S&P License Agreement, and non-exclusive for the last year.

In connection with S&P Dow Jones Indices, we have a license agreement (S&P License Agreement) for certain S&P stock indexes and related trade names, trademarks and service marks in connection with the creation, marketing, trading, clearing and promoting of futures contracts and/or options on futures contracts that are indexed to certain S&P stock indexes.

Our license for the S&P 500 Index will be exclusive for futures and options until one year prior to the termination of the S&P License Agreement, and non-exclusive for the last year.

The license for the other S&P stock indexes is generally exclusive for futures and options.

The term of the S&P License Agreement will continue until the date that is one year after the date that CME Group ceases to own at least 5% (accounting for dilution) of the outstanding joint venture interests.

Upon the occurrence of certain events, including certain terminations of the joint venture, the term may be extended up to an additional ten years.

CBOT has an exclusive license agreement (Dow Jones License Agreement) with CME Group Index Services LLC (CME Indexes) for certain Dow Jones indexes, which has also been assigned to the joint venture.

In connection with S&P Dow Jones Indices, we also have an exclusive license agreement (Dow Jones License Agreement) for certain Dow Jones indexes.

The initial term of the agreement is through June 30, 2026.

Following the initial term, the Dow Jones License Agreement will automatically renew for renewal terms of five years thereafter, so long as there is open interest in any of CBOT’s or its affiliates’ products based on one or more of the Dow Jones licensed indexes.

In the event there is no open interest in any such products, then CME Indexes may terminate the agreement.

In the event there is no open interest in any such products, then we may terminate the agreement.

We also have an exclusive license agreement for certain Nasdaq indexes through 2029.

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A copy of the S&P License Agreement has been filed as a material contract.

We also have a multi-year non-exclusive licensing arrangement with ICE Benchmark Administration for the use of LIBOR to settle several of our interest rate products, including our Eurodollar contracts.

We cannot guarantee that we will be able to maintain the exclusivity of our licensing agreements with S&P, Dow Jones, Nasdaq and FTSE Russell or be able to maintain existing exclusive and non-exclusive licensing arrangements beyond the term of the current agreements or that any renewal will be on terms as favorable to us.

In addition, we cannot guarantee that others will not succeed in creating stock index futures based on information similar to that which we have obtained by license, or that market participants will not increasingly use other instruments, including securities and options based on the S&P, Dow Jones, Nasdaq or FTSE Russell indexes, to manage or speculate on U.S.

CME Group is the owner of CME Term SOFR, a daily set of forward-looking interest rate estimates, calculated and published for 1-month, 3-month and 12-month tenors.

CME Term SOFR was endorsed by the ARRC convened by the Federal Reserve Board and the New York Federal Reserve and the Board itself under its Final Rule published in January 2023, which Rule has generally designated CME Term SOFR as a replacement rate for USD LIBOR under the LIBOR Act.

We cannot guarantee we will be able to maintain the exclusivity of our licensing agreements with S&P, Dow Jones, Nasdaq and FTSE Russell or be able to maintain existing exclusive and non-exclusive licensing arrangements beyond the term of the current agreements or that any renewal will be on terms as favorable to us.

In addition, we cannot guarantee that others will not succeed in creating stock index futures based on information similar to that which we own or have obtained by license, or that market participants will not increasingly use other instruments, including securities and options based on the S&P, Dow Jones,

Nasdaq or FTSE Russell indexes, to manage or speculate on U.S.

Parties also may succeed in offering indexed products that are similar to our licensed products without being required to obtain a license, or in countries that are beyond our and/or our licensors' jurisdictional reach.

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• depth and liquidity of markets;

• capital efficiencies;

• diversity of product offerings and frequency and quality of new product development and innovative services;

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• overall transaction costs.

We believe that we compete favorably with respect to these factors.

We believe we compete favorably with respect to these factors.

Our deep, liquid markets;

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Competition in our CME Clearing Business

In the past few years there has been increased competition in the provision of clearing services, and we expect competition to continue to increase in connection with compliance with Dodd-Frank, EMIR 2.2, Basel III, MiFID II and other various laws and regulations.

Our competitors in the clearing services space include, among others, companies such as ICE, LCH Group, the OCC, Depository Trust & Clearing Corporation, Hong Kong Exchanges and Clearing, Japan Securities Clearing Corporation, LME Clearing and Deutsche Börse AG.

In light of the implementation of new regulatory requirements and other reforms of the financial services industry, we believe that other exchanges and infrastructure providers also may undertake to provide clearing and other related post-trade services, such as Nodal and ERIS in the U.S., as CFTC-regulated designated clearing organizations.

We have also seen the acquisition of smaller clearing houses by larger and better capitalized firms, including FTX’s acquisition of LedgerX.

In recent years there has been increased competition in the provision of clearing services, and we expect competition to continue to increase in connection with compliance with Dodd-Frank, EMIR 2.2, Basel III, MiFID II and other various laws and regulations.

Our competitors in the clearing services space include, among others, companies such as ICE, LCH Group, the OCC, CBOE Clear, Depository Trust & Clearing Corporation, Hong Kong Exchanges and Clearing, Japan Securities Clearing Corporation, LME Clearing and Deutsche Börse AG.

In light of the implementation of new regulatory requirements and other financial

services reforms, we believe other exchanges and infrastructure providers also may undertake to provide clearing and other related post-trade services in the U.S.

as CFTC-regulated clearing organizations.

We believe competition in clearing services is based on, among other things, the value of providing customers with capital and margin efficiencies;

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The cash markets businesses face substantial competition across a wide and growing array of venues.

In the FX space, the marketplace is highly fragmented, and there is competition from other electronic communication networks, single-dealer platforms, bank-owned multi-participant platforms, streaming and request for quote services, trading venues tied to data platforms, voice brokers, other broker enabled platforms and other venues.

There is a growing array of platforms and technologies, and they are often owned by many well-capitalized financial institutions and intermediaries that are also driving internalization of client FX trade flows.

In FX, the marketplace is highly fragmented, and there is competition from other electronic communication networks, single-dealer platforms, bank-owned multi-participant platforms, streaming and request for quote services, trading venues tied to data platforms, voice brokers, other broker enabled platforms and other venues.

There is a growing array of platforms and technologies, often owned by well-capitalized financial institutions and intermediaries that are also driving internalization of client FX trade flows.

In the fixed income space, there are also multiple providers of treasury, European and U.S.

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Technology companies, market data and information vendors and front-end software vendors also represent actual and potential competitors because they have their own substantial market data calculation and distribution capabilities that could serve as alternative means for receiving open market data feeds instead of connecting directly to our exchange.

Multiple other industry players offer both referential and indicative pricing alternatives to CME offerings, which are widely distributed and available across a variety of media.

Distributors and consumers of our market data may also use our market data as an input into a product that competes against one of our traded or cleared products.

Multiple other industry participants offer both referential and indicative pricing alternatives to CME offerings, which are widely distributed and available across a variety of media.

Distributors and consumers of our market data also may use our market data as an input into products that compete against our traded or cleared products.

Although we may receive license fees for such products, such fees may not offset the impact of any loss in revenue from our comparable product.

Regulatory Matters

Our businesses are regulated and serve a customer base that includes regulated institutions or individuals.

Our businesses are regulated and serve a customer base that includes regulated market participants, and as such, we are subject to extensive regulation, primarily in the United States and Europe.

Developments in the regulatory environment therefore have the potential to significantly affect our businesses.

As such, we are subject to extensive regulation, primarily in the U.S.

Please also refer to the discussion below and in "Item 1A - Risk Factors" beginning on page 15 for a description of regulatory and legislative risks and uncertainties.

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CME has been designated as a systemically important financial market utility and a systemically important derivatives clearing organization.

These designations carry with them additional regulatory oversight of certain of our risk-management standards, clearing and settlement activities by the CFTC and the Federal Reserve Board.

These designations carry with them additional regulatory oversight of certain of our risk-management standards and clearing and settlement activities by the CFTC and the Federal Reserve Board.

In connection with the global offering of our products and clearing services, this business is also subject to the rules and regulations of the local jurisdictions in which we conduct business, including the European Securities and Markets Authority (ESMA), the U.K.

Financial Conduct Authority (FCA) and Bank of England and the Netherlands Authority for the Financial Markets (AFM).

Financial Conduct Authority (FCA) and Bank of England, the Netherlands Authority for the Financial Markets (AFM) and the Federal Financial Supervisory Authority (BaFin) in Germany, among others.

Regulation of our Cash Markets Business

The operation of our BrokerTec platform subjects us to regulation by the Financial Industry Regulatory Authority (FINRA) and the U.S.

The operation of BrokerTec subjects us to regulation by the Financial Industry Regulatory Authority (FINRA) and the U.S.

Securities and Exchange Commission (SEC) as a broker-dealer and alternative trading system operator.

It also subjects us to regulation by authorities in the E.U.

as a multilateral trading facility and regulated market and by the applicable regulators in Singapore and Canada.

Our EBS business holds various permissions, approvals and exemptions globally, including those that subject certain of its activities to CFTC, FCA, the Dutch Authority for the Financial Markets (AFM) and Hong Kong Monetary Authority (HKMA) oversight.

as a multilateral trading facility and regulated market and by the applicable regulators in

Singapore and Canada.

Our EBS business holds various permissions, approvals and exemptions globally, including those that subject certain of its activities to CFTC, FCA, AFM, Monetary Authority of Singapore, Australian Securities and Investments Commission and Hong Kong Monetary Authority oversight.

The settlement of matched principal and exchange-traded businesses requires access to clearing houses either directly or through third-party providers of clearing and settlement services.

BrokerTec Americas is a member of the FICC, through which it clears U.S.

BrokerTec Americas is a member of the Fixed Inocme Clearing Corporation, through which it clears U.S.

Treasury and repo products.

Regulation of our Market Data Business

A portion of our market data business, offered by CME Group Benchmark Administration, is subject to regulation by the E.U.

Benchmarks Regulation, which regulates our RepoFunds Rate suite of daily Euro repo indices.

Our CME Group Benchmark Administration, which is authorized as a Benchmark Administrator by the FCA, administers and calculates the CME Term Secured Overnight Financing Rate (SOFR) Reference Rates group of benchmarks.

Our subsidiary, CME Group Benchmark Administration, is a registered benchmark administrator, authorized and supervised by the FCA under the UK Benchmark Regulations.

CME Group Benchmark offers a variety of different multi-asset class data products, including CME Term SOFR.

Key Areas of Focus

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We are also focused on the U.S.

Presidential administration and its new federal regulatory appointees and any anticipated changes that may result.

Presidential administration and its federal regulatory appointees and any anticipated changes that may result.

Our key areas of focus in the regulatory environment are:

• The FCA’s announcement of its phase out of the use of LIBOR, which may unfavorably impact our ability to list our existing suite of Eurodollar futures and options products.

• The implementation of a transaction tax or user fee in the U.S., U.K.

, or in the States of Illinois or New Jersey, which could discourage institutions and individuals from using our markets or products or encourage them to trade in another less costly jurisdiction.

or E.U., or in the States of Illinois or New Jersey, which could discourage institutions and individuals from using our markets or products or encourage them to trade in another less costly jurisdiction.

Legislation to impose a financial transaction tax has been proposed previously in the U.S.

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Legislation would be necessary to impose such a fee.

• The potential for further regulation stemming from industry performance disruptions and residual concerns around electronic trading activity and, in particular, "high frequency trading."

Federal legislation was also recently proposed by Congress that would impose a user fee on digital asset spot markets to fund CFTC regulation of those assets.

Such a user fee, if adopted, could potentially be expanded to apply more broadly to the futures and options markets.

• Legislation that proposes to eliminate the 60/40 tax treatment of certain of our futures and options contracts, which would result in 60% of the gains being taxed at the short-term capital gain rate instead of the long-term capital gain rate.

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Treasury securities as collateral could result in increased costs to us and our clearing firms.

• The implementation of the final phases of uncleared margin rules (UMR Phases 5 & 6) across jurisdictions and implications for customers' management of exposures.

• The potential regulation of cryptocurrencies, which may impact our existing offerings or our ability to provide future offerings.

• The outcome of the debate regarding the regulation of cryptocurrencies, which may impact our existing offerings or our ability to provide future offerings.

• New regulations governing treasury market structure, including potential clearing obligations or promotions of all-to-all cash treasury models.

The SEC has issued a rule proposal regarding central clearing of U.S.

Treasury securities and repurchase agreements;

how the SEC finalizes this rule could have an impact on trading in our markets.

• The potential for regulatory or policy actions that could result in changes to market structure for the clearing of derivative transactions, which may impact our business model or the competitive landscape of the industry.

Please also see "Item 1A - Risk Factors" beginning on page 15 for additional information on our areas of regulatory risks.

Human Capital Management

At CME Group, we rely on our highly skilled and experienced global workfor ce to meet our business objectives.

As of December 31, 2021, our global employee population consisted of approximately 3,480 staff, with 67% (approximately 2,320) of these employees working in the U.S.

We rely on a highly skilled and experienced global workfor ce to meet our business objectives.

As of December 31, 2022, our global employee population consisted of approximately 3,460 staff, with 66% (approximately 2,280) of these employees working in the United States.

and the remaining 34% (approximately 1,180) working in our various non-U.S.

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• 21.5% of employees promoted

The above metrics exclude approximately 150 staff who do not fully participate in our talent programs.

Diversity and Inclusion

As the world’s leading and most diverse derivatives marketplace, we embrace an exchange of ideas driven by the rich diversity of our people, cultures and experiences.

At CME Group, we embrace an exchange of ideas driven by the rich diversity of our people, cultures and experiences.

We know that when our employees bring their authentic selves to work each day, it makes our business and our culture that much stronger.

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https://www.cmegroup.com/company/corporate-citizenship/esg.html.

Information made available on our website does not constitute a part of this Annual Report on Form 10-K.

Information about our Executive Officers

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from 1981 to 2002 and has been a member of our CME exchange since 1981.

Cronin has served as our Senior Managing Director, General Counsel and Corporate Secretary since 2003.

Prior to joining us, Ms.

Cronin was a corporate attorney at Skadden, Arps, Slate, Meagher & Flom LLP from 1989 through 1995 and from 1997 through 2002.

Cronin also serves as a director of Kemper Corporation.

Sunil Cutinho , 51 .

Cutinho has served as our Chief Information Officer since February 2022 and previously has served as President of CME Clearing since 2014.

He joined CME Group in 2002 and since then has held various positions of increasing responsibility within the organization, and most recently served as Managing Director, Deputy Head of CME Clearing from April 2014 through September 2014.

Cutinho has served as our Chief Information Officer since February 2022 and previously served as President of CME Clearing since 2014.

He joined CME Group in 2002 and since then has held various positions of increasing responsibility within the organization, including as Managing Director, Deputy Head of CME Clearing from April 2014 through September 2014.

Lynne Fitzpatrick, 44.

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She previously served as Managing Director of Corporate Development and Treasurer of CME Group since 2017, leading the company’s business development, mergers and acquisitions, CME Ventures and corporate treasury functions.

Since joining the company in 2006, Fitzpatrick has held a variety of positions with increasing levels of responsibility within the finance organization.

Since joining the company in 2006, Ms.

Fitzpatrick has held a variety of positions with increasing levels of responsibility within the finance organization.

Prior to CME Group she worked as an investment banker at Credit Suisse and UBS.

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Holzrichter previously held positions of increasing responsibility in our organization from 1986 to 2003 in trading operations.

Holzrichter also serves as a director of Constellation Energy Corporation, an Exelon company.

Holzrichter also serves as a director of Constellation Energy Corporation.

Jonathan Marcus, 54.

Marcus has served as our Senior Managing Director and General Counsel since October 2022.

Prior to joining CME Group, Mr.

Marcus most recently worked in priv ate practice as a partner at Reed Smith LLP, where he specialized in derivatives regulation, litigation and enforcement.

He previously served as General Counsel of the CFTC from 2013 to 2017.

Marcus also served as the CFTC's Deputy General Counsel for Litigation and as an Assistant to the Solicitor General of the United States.

His career also includes senior roles at other nationally recognized law firms and he began his career as a clerk for Judge Jose Cabranes of the U.S.

Court of Appeals for the Second Circuit .

Tim McCourt, 44 .

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Before joining CME Group in 2013 as Global Head of Equity Products, Mr.

McCourt worked for the Royal Bank of Scotland, where he was responsible for building and managing the Americas Index and Delta One trading book.

McCourt worked for the Royal Bank of Scotland (RBS), where he was responsible for building and managing the Americas Index and Delta One trading book.

Prior to RBS, he held a senior trading role with JPMorgan in New York, spending 10 years with the Equity Derivatives Group.

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Piell has served as Senior Managing Director and Chief Human Resources Officer since 2007.

Previously she served as Managing Director and Senior Associate General Counsel, as Director and Associate General Counsel and as Associate Director and Assistant General Counsel since joining us in 2000.

A practicing attorney for seventeen years, Ms.

Piell previously held positions of increasing responsibility in our Legal & Market Regulation division, most recently as Managing Director and Senior Associate General Counsel.

Prior to joining CME Group in 2000, Ms.

Piell served as Associate Commercial Counsel at MCI Telecommunications (1996-2000) and Associate Litigation Attorney at Jenner & Block (1992-1996).

Her career also includes service as a clerk for a judge of the U.S.

District Court for the Northern District of Illinois.

Pietrowicz, 58.

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Pietrowicz joined us in 2003 and since then has held various positions of increasing responsibility, including Managing Director and Deputy Chief Financial Officer from 2009 to 2010 and Managing Director, Corporate Finance and Treasury from 2006 to 2009.

Pietrowicz also serves as a director of S&P/Dow Jones Indices LLC.

Pietrowicz also serves as a director of S&P Dow Jones Indices LLC and on the board of the World Federation of Exchanges.

Pietrowicz announced his plans to retire in 2023 and Ms.

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Tully has served as Senior Managing Director, Global Head of Rates and OTC Products since February 2022.

He previously served as Senior Managing Director, Financial and OTC Products of CME Group since 2014.

previously served as Senior Managing Director, Interest Rates and OTC Products during 2014.

Previously, he served as Managing Director, Interest Rate and OTC Products since 2013 and as our Managing Director, Interest Rate Products since joining us in 2011.

He previously served as Senior Managing Director, Financial and OTC Products of CME Group since 2014 and as Senior Managing Director, Interest Rates and OTC Products during 2014.

Prior to these roles, he served as Managing Director, Interest Rate and OTC Products since 2013 and as our Managing Director, Interest Rate Products since joining us in 2011.

Before joining the company, Mr.

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Vroman has served as our Senior Managing Director, Chief Transformation Officer since November 2021.

He previously served as Senior Managing Director, International and Optimization Services since February 2020 and as our Senior Managing Director, Cash Markets and Optimization Services.

Since joining the company in 2001, he has held a variety of senior leadership roles, including Managing Director, Planning and Execution, Global Head, Commodity Products and OTC Solutions and Managing Director and Chief Corporate Development Officer.

He previously served as Senior Managing Director, International and Optimization Services since February 2020 and as our Senior Managing Director, Cash Markets and Optimization Service since 2018.

Since joining the company in 2001, he has held a variety of senior leadership roles, including Managing Director, Planning and Execution;

Global Head, Commodity Products and OTC Solutions, and Managing Director and Chief Corporate Development Officer.

Prior to joining us, Mr.

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Winkler has served as our Senior Managing Director, Chief Commercial Officer since 2016.

She leads the company’s sales, product marketing, research and product development, data analytics, and innovation lab functions, as well as the data services business line.

She previously served as Senior Managing Director, Research and Product Development and Index Services of CME Group since 2014 and as Managing Director, Research and Product Development since 2007.

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The SEC also maintains an Internet site that contains reports, proxy and information statements, and other reports that we file or furnish with the SEC at http://www.sec.gov.

Copies of these materials also are available to shareholders free of charge upon request to Shareholder Relations, office.ofthesecretary@cmegroup.com.

Copies of these materials also are available to shareholders free of charge upon request to Shareholder Relations, officeofthesecretary@cmegroup.com.

Information regarding our sustainability practices is available in our annual Corporate Citizenship & Sustainability Reports, including our report for 2022 when issued, at the following:

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business