SEC Reviews 85% Proposal That Could Impact Bitcoin and XRP ETF Listings

Key Takeaways:

• SEC notice seeks comment on NYSE Arca proposal requiring 85% of assets meet eligibility standards.
• NYSE Arca rule would count derivatives by gross notional value, impacting crypto trust qualification calculations.
• Crypto and commodity trusts may use up to 15% in non-qualifying assets while remaining compliant.

SEC Notice Opens Comment Period on 85% Asset Rule Proposal

A Securities and Exchange Commission (SEC) notice published April 27, 2026, outlines a proposed rule change from NYSE Arca that could reshape how crypto and commodity investment products qualify for exchange listing. The SEC is seeking public comments on whether the proposal is consistent with the Securities Exchange Act. The filing introduces an 85% asset threshold that would limit exposure to holdings outside existing eligibility standards. The proposal highlights a shift toward tighter portfolio requirements for future trust listings.

NYSE Arca is seeking to revise Rule 8.201-E, the generic listing framework for commodity-based trust shares. Under the proposed change, at least 85% of a trust’s net asset value would need to be held in assets already allowed by the rule. Those assets may include qualifying commodities, commodity-based assets, securities, cash, and cash equivalents. The remaining 15% could include other assets that do not independently meet the rule’s eligibility criteria, as long as the trust otherwise remains compliant. The filing states:

“The exchange proposes to amend Rule 8.201-E (Generic) to modify the generic listing standards for commodity-based trust shares.”

The proposal would also count listed and over-the-counter derivatives by aggregate gross notional value. That means large options or futures positions could affect whether a product qualifies. Sponsors would have to monitor the 85% threshold daily and quickly notify NYSE Arca if a trust falls out of compliance. The filing presents the change as a way to permit more listings while keeping most exposure tied to assets that support market surveillance.

Eligibility Rules Highlight Limits on Derivatives and Non-Qualifying Assets

The examples in the filing show why the threshold could matter for future crypto and commodity funds. A trust with 95% of its value in qualifying assets such as bitcoin, ether, solana, and XRP would meet the proposed standard. These assets qualify because they underlie futures contracts that have traded on designated markets for at least six months and are associated with exchange-traded products providing significant exposure, meeting the rule’s eligibility criteria.

A gold-focused trust using gold and gold futures would also qualify if all holdings satisfy the current rule. But a trust holding bitcoin and OTC call options on a bitcoin ETF would fail if only about 71% of its exposure met the required criteria. That example shows how non-qualifying derivatives can outweigh an otherwise eligible bitcoin position. NYSE Arca also wants to exclude non-fungible assets and collectibles from the rule’s commodity definition. The filing says those assets were not contemplated when the generic standards were adopted.

Beyond crypto funds, the proposal points to a tighter path for product approvals. NYSE Arca could still seek separate approval for trusts involving non-fungible assets or collectibles, but those products would not qualify through the generic listing route. The exchange says the 85% threshold is consistent with similar commodity-based exchange-traded products and would support competition among issuers and venues. The filing also states that the framework is designed to improve the exchange’s ability to monitor trading, deter manipulation, and protect investors while enabling additional products to come to market. The filing notes:

“The exchange does not believe that the proposed rule change will impose any burden on competition that is not necessary or appropriate in furtherance of the purposes of the Act.”

The SEC can approve, reject, or open proceedings on the proposal during its review period. Interested parties may submit comments to the SEC on the rule change, including arguments on whether it meets the Act’s requirements. The key takeaway is that future crypto and commodity trust listings may gain flexibility, but only under stricter exposure limits.