SEC reviews NYSE Arca proposal to tighten crypto ETF listing rules

The U.S. Securities and Exchange Commission (SEC) has begun reviewing a proposal from NYSE Arca to tighten listing standards for crypto ETFs, a move dubbed the "85% qualified asset requirement" rule, Bitcoin.com reported. NYSE Arca is seeking to amend its rules to mandate that at least 85% of the assets in a commodity-based ETF must be "verified assets." These include qualified commodities, stocks, cash, and cash equivalents. Assets like BTC, ETH, SOL, and XRP could qualify, as futures for these have been trading for over six months. The outlet noted that the amendment also includes a provision to calculate over-the-counter (OTC) derivatives based on their total notional value, which could make it difficult for products with a high concentration of derivatives to maintain their listing. NYSE Arca explained that the change aims to prevent market manipulation and protect investors. The SEC is expected to gather industry feedback before making a final decision on whether to approve the rule.