SR-NSCC-2022-003 | This Proposal Will NOT Prevent MOASS [But Should Be Withdrawn]

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Good Day, Apes,

Einfachman here. Yesterday was a little unsettling, to be honest. The amount of Fear, Uncertainty, and Doubt spread all over the sub wasn’t a good sight to see. Apes saying that “MOASS is over” because of this filing, were doing more harm to the community than the harm this proposal would actually cause if implemented.

I would like to reiterate: this proposal will NOT prevent MOASS.

What I saw yesterday was not unprecedented behavior. It was actually reminiscent of August, 2021 when Charlie’sVids on YouTube, along with many Apes on SuperStonk (and other subs), were spreading FUD/misinformation about the CFTC filing allowing banks to not report derivatives. There was a big FUD wave forming saying “MOASS delayed until 2024!!” and “SHFs won”, and Criand and I had to calm everyone down and explain that this wasn’t the case:

With that being said, since this is happening again, I would like Apes to use yesterday as a tool to better prepare yourself, and the sub, psychologically for MOASS. When MOASS begins, there will be all types of tricks SHFs will play. It will not be a straight line to $100 million per share.. MOASS could literally last over a month due to trading suspensions, halts, etc. So use yesterday as a tool for self-improvement. We’ve gotten to where we are today because of our ability to Buy, Hold, & DRS, remain stoic, and not allow the market/algorithm to psychologically manipulate us and allow ourselves to be consumed by emotions.

Getting that out of the way, let’s dig into proposal NSCC-003:

This is the filing in question:

There’s a few vocab words that Apes should familiarize themselves with before we continue:


Vocab for Apes:

Novate: replace an old obligation with a new one.

SFT (Securities Financing Transaction): transaction where parties exchange equity securities (in our case, GME) for cash, under the agreement to exchange these assets back to each other at a later date.


Please note that this filing is 188 pages, and I abdicated my sleep to read through all this and try to best present it to you guys, so if there’s a few things you believe I missed in the filing, please feel free to let me know and reference the page number.

There’s a lot this filing goes through, like general collateral upgrades for SFTs to better shield from a market crash, similarly to general collateral upgrades from NSCC-2021-005, which I went over last year:

But I will be going over the significant portions of this filing that primarily relate to GME & the MOASS.

Relating to SFTs:

pg. 3:

“NSCC is proposing to introduce central clearing for SFTs, which are, broadly speaking, securities lending transactions where parties exchange equity securities against cash and simultaneously agree to exchange the same securities and cash, plus or minus a rate payment, on a future date.”

pgs. 3-4:

“NSCC understands that SFTs provide liquidity to markets and facilitates the ability of market participants to make delivery on short-sales, and thereby avoid failures to deliver, “naked” shorts, and similar situations.”

Ok. First, what does this mean? The NSCC is introducing SFTs to avoid FTDs, naked shorts, etc. Does this help reduce aggressive shorting? In theory, it should, but in reality it wont. This will be abused to novate contracts and reset FTDs. Doesn’t mean much to us, because MOASS initiating was never dependent on FTDs being settled, because SHFs would always can-kick them to begin with, as they have the past year.

What about naked shorting?

This can’t create more naked shorts. The only true benefit SFTs could provide to them in regards to naked shorts is that it’ll help them limit the effects of the MOASS, when MOASS comes.

In my Checkmate DD (, I explained how SHFs would need to come up with 6 times the amount of synthetic shares they have created in the entire history of shorting GME (in the event of a 7:1 split in the form of a dividend), which would be near impossible for them to do, leading to a checkmate move from RC and a MOASS upon implementation of the split.

Well, SHFs can’t use SFTs to create synthetic shares. All they’re doing is exchanging shares for cash equivalent (pretty much borrowing), but those shares not only need to be returned to the institution that lent them, but post-split (in the event of a 7:1 post-split), SHFs would also have to return 6 additional synthetic shares back to the institution they borrowed from. They can’t use this to create synthetics for dividend payments. Meaning MOASS will still happen and is still on schedule. It’s also why we see RC is pretty chill. After GME was halted in March, RC tweeted “Who is more reprehensible, hedge fund short sellers or overpriced consultants?” If NSCC was threatening the effects of the stock split dividend or preventing MOASS, RC would likely turn his attention to the NSCC. The fact is that everything is still going according to plan.

So, why should we care about NSCC-003?

Glad you asked. Let’s start with the pros and cons of NSCC-003:


Firstly, I’d like to share a big hype part in this filing that it seems a lot of Apes missed. After yesterday, I feel like Apes could use the hype, too, so here it is:

The filing virtually confirms there WILL be a MOASS.

Check page 184: “Although the proposal would impose an additional charge with respect to any Non-Returned SFT that is calculated based on the relevant SFT Member’s Credit Risk Rating Matrix rating and such requirement may limit the ability of certain Members to participate in the proposed SFT Clearing Service, NSCC believes that any related burden on competition would be necessary and appropriate in furtherance of the purposes of the Act. This is because such requirement is designed to allow NSCC to prudently manage increased risks associated with Non-Returned SFTs. As described above, to the extent that the Final Settlement of an SFT is scheduled on a particular date but does not occur, whether directly or through a pair off in accordance with Section 8 of proposed Rule 56 (as discussed above), that could potentially be a result of a “squeeze” or other market dislocation whereby NSCC may face increased market risk in the event of the default of either the Transferor or the Transferee. The proposed requirement would help to ensure that NSCC’s Clearing Fund deposit requirements take into account increased market risk that NSCC may face in connection with Non-Returned SFTs. “

They KNOW this is going to happen, which is why they’re legit mentioning it here. Hence, the entire purpose of this filing. They’re trying to maintain order and control when clearing members start defaulting. That’s all this entire filing is:

When MOASS starts, market participants will be defaulting. The NSCC is trying to determine what to do to control the damage from all these defaults, as shown on pg.7-8 of the filing:

“NSCC believes that broadening the scope of central clearing at NSCC to SFTs would reduce the potential for market disruption from fire sales for a number of reasons. First, in the event of a default, NSCC would conduct a centralized, orderly liquidation of the defaulter’s SFT Positions (as defined below and in the proposed rule change). Such an organized liquidation should result in substantially less price depreciation and market disruption than multiple independent non-defaulting parties racing against one another to liquidate the positions. Second, NSCC would only need to liquidate the defaulter’s net positions. […] Limiting the positions that need to be liquidated to the defaulter’s net positions should reduce the volume of required sales activity, which in turn should limit the price and market impact of the close-out of the defaulter’s positions. Lastly, NSCC would use its risk management resources to provide confidence to market participants that they will receive back their cash or securities, as applicable, which should limit the propensity for market participants to seek to unwind their transactions in a stressed market scenario.”

So, yes. MOASS will happen. The NSCC is primarily focusing on the damage DURING the MOASS.

The only benefits I see besides the acknowledgment of MOASS is that they might be able to save some market participants with this, and also lessen the extent of how strong the market crash will be. Although, one could argue that them fighting this market crash is only going to prevent us from having a free market, where we get real price discovery on the index funds.

Cons: This filing will attempt to limit the extent of MOASS.

For example, recall that on pages 7-8, the NSCC would only need to liquidate the defaulter’s net position, not everything. This would limit how many short positions need to be closed.

r/Superstonk - SR-NSCC-2022-003 | This Proposal Will NOT Prevent MOASS [But Should Be Withdrawn]

Net position, as defined by NASDAQ

P.S. I noticed on NASDAQ’s website, they made a grammatical error for the definition of “net position”. They used “where” instead of “were” on the 2nd sentence. Thought that was pretty funny, considering the NASDAQ is a leading global exchange.

Anyways, SFTs would also pose a problem during MOASS.

SFTs would allow SHFs to hide a portion of their obligations during MOASS.

The NSCC provides an example for how this would work on page 12:

“For example, assume that a Transferor (as defined below and in the proposed rule change) and Transferee (as defined below and in the proposed rule change) enter into an SFT pursuant to which: (i) in the Initial Settlement (as defined below and in the proposed rule change) on Monday, the Transferor will transfer 100 shares of security X to the Transferee against $100 per share; and (ii) in the Final Settlement on Tuesday, the Transferee will transfer 100 shares of security X to the Transferor against $100 per share. After the Initial Settlement occurs on Monday, the Final Settlement of the SFT is novated to NSCC. In the Final Settlement on Tuesday, the Transferee will return 100 shares of security X to the Transferor for $100 per share.”

Let’s say GME is at $1,000, about to take off and they create SFTs for a few million GME shares, a few weeks later GME is in the millions, but SHFs closed their net positions, and “hid” those other few million shares off their balance sheets for the time being. SHFs will still be bankrupt (unless the NSCC trying to bail them out in some way), but the extent of MOASS could’ve been even bigger if SHFs were forced to close their net positions as well as the positions they hid in the SFTs during the MOASS. Ergo, the NSCC is trying to limit the effects of MOASS by allowing tools such as SFTs to limit the total number of positions that end up getting closed during MOASS.

pgs. 19-21 deal with what happens to SFTs that fail-to-deliver.

“It is occasionally the case in the securities lending market that a borrower is solvent and able to satisfy its general obligations as they become due but unable to deliver the lent securities to the lender within the timeline requested by the lender. The contractual remedy that has developed in the bilateral securities lending market for these situations is a “buy-in.” Under this remedy, the lender may purchase securities equivalent to the borrowed securities in the market and charge the borrower for the cost of this purchase.”

Ok, so this part is messed up. This is like dark pool. When MOASS happens, SHFs could do this and successfully prevent millions of GME shares from hitting the lit market, by borrowing GME shares from another party, not returning them, and paying for completely unrelated shares.

The thing is that they can’t do this for ALL their short positions, because they wouldn’t have the money to do so, nor would any party have enough shares to cover ALL of Citadel’s (and friend’s) synthetic shares. So, again, this won’t stop MOASS. But, this filing is clearly doing its best to limit the extent of MOASS by taking away as many share closing obligations they can from liquidation and price discovery. The rest of the SFTs that fail-to-deliver (they call Non-Returned SFT), deals with how the NSCC may novate the contract and handle the process once the lender recalls the SFT.


Ok. Here’s some bullet points for yall:

• NSCC-003 allows for dark pool-type abuse to limit legitimate price discovery during MOASS.

•NSCC-003 can shed off a portion of short positions required to be closed during MOASS.

• NSCC-003 allows for more loopholes to lessen the extent of MOASS.

•NSCC-003 could help SHFs delay a portion of the GME shares needed to be returned.


Again, this won’t stop MOASS, but would lessen the extent of MOASS.

Even with this filing in place, I can say with a high degree of confidence that GME can still hit a price in the millions. I explained in my “We Are Unstoppable” DD, ( § 4: Geometric Mean:,

also in my DD “Mountains of GME Synthetic Shares”…


…that 90% of GME shares could be paperhanded, and still not inhibit MOASS, because it’s the final millions of shares SHFs will need that will drive the price up past the millions easily.

So no, MOASS will not be prevented by NSCC-003. It will dampen the potential of MOASS, but not prevent it.

Regardless, NSCC-003’s implementation would limit the effect of MOASS, allow more stupid loopholes and tricks for SHFs to abuse, allow for more market manipulation, and would ultimately go against legitimate price discovery and a fair & free market, so Apes shouldn’t be supporting this filing at all.

NSCC-003 should be withdrawn, and Apes should be commenting on the rule in opposition.

The good news is that the NSCC tried this before. They proposed this garbage in the past but withdrew it both times they proposed it, because APES WERE VOCAL. Apes fought back and commented on the rule in heavy opposition.

If Apes comment on the rule in heavy opposition of this proposal in mass, based on past behavior with from the NSCC, I believe they’ll withdraw it once again.

They already withdrew it 2 times in the past, but I have a feeling the NSCC is afraid now because RC’s stock split dividend accelerates the countdown to MOASS, so they’ve introduced this proposal again. If they withdraw this proposal, they might not have enough time to come up and implement a new one before the stock split dividend gets implemented, which would be a win for Apes.

TL;DR: NSCC-003 allows for dark-pool type abuse during MOASS, and although it won’t prevent MOASS, if approved, it will be a significant factor inhibiting the potential of MOASS, possibly creating a weaker and prolonged MOASS (regardless, GME would still have the potential of hitting a price in the millions). Ultimately, NSCC-003 is harmful to a “fair and free market” & Apes should be vocal in opposition of NSCC-003.


If you want to help get this proposal withdrawn, you need to send an email to . Subject needs to be “SR-NSCC-2022-003”. Simply state your vehement opposition to this ruling as a retail investor and end by requesting that it needs to be withdrawn to preserve market fairness and integrity.

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