Setting the (Generic) Standard: SEC Clears the Path for Listing Commodity-Based and Crypto ETPs

The Securities and Exchange Commission (SEC) approved proposed rule changes by multiple exchanges to adopt generic listing standards for Commodity-Based Trust Shares,[1] including those that hold digital assets such as cryptocurrencies (“New Listing Standards”). This move allows national securities exchanges to list and trade qualifying exchange-traded products (ETPs) holding spot commodities without requiring each product to undergo the previously mandatory, individualized SEC rule filing process under Section 19(b) of the Securities Exchange Act of 1934, as amended (Exchange Act). As a result, exchanges such as NYSE Arca, Nasdaq, and Cboe BZX can now bring eligible commodity- and crypto-based ETPs to market much more quickly, shortening the approval timeline from many months to as little as 60-75 days.[2]

More specifically, to begin trading, the issuer of a product generally must file a registration statement and have it declared effective. The SEC must also approve a rule change proposal from the exchange seeking to list the product. The adoption of New Listing Standards eliminates what is often a six-month waiting period for rule change approval, but the SEC still retains a role through the registration statement review process. In other words, this change does not mean that products will become effective immediately without any SEC oversight or approval. Rather, it eases the process and accelerates the overall approval timeline.[3]

With these New Listing Standards, the SEC introduced a “rational, rules-based approach”[4] and clarified the criteria for listing products. There are several paths for a digital asset or commodity to qualify: (1) it must either trade on a market with an Intermarket Surveillance Group membership and surveillance-sharing agreements, (2) underlie a CFTC-regulated futures contract traded for at least six months, or (3) be tracked by an existing exchange traded fund[5] (ETF) with no less than 40 percent of its net asset value exposed to the commodity and listed on a national securities exchange. If an ETP does not meet the New Listing Standards, the exchange must file a proposed rule change with the SEC before listing and trading it.[6] This development positions U.S. capital markets as leaders in digital asset product innovation while lowering barriers to investor access and expanding the range of available products.

While this new framework encourages speed and efficiency, the SEC emphasized that investor protections remain intact through regulatory oversight, eligibility standards, and required risk disclosures. Many industry participants view the New Listing Standards as a game-changer that could unleash a wave of new crypto-based and commodity ETP offerings.[7] However, SEC Commissioner Caroline A. Crenshaw expressed concerns about the risks of introducing newer asset classes to public markets without individualized review.[8] Nevertheless, the approval signals a shift toward a more streamlined, transparent, and efficient rules-based listing process that offers both clarity and opportunity for market participants. The SEC approved the New Listing Standards on an accelerated basis, which makes them effective immediately. This is the latest development under the SEC’s Project Crypto initiative to modernize digital asset regulation.[9]

In a related development, the SEC approved two separate actions: the listing of the Grayscale Digital Large Cap Fund, which holds a basket of spot digital assets, and the introduction of options contracts based on Bitcoin ETF indexes.^[10]

[1] A “Commodity-Based Trust Share” is defined as a security that: is issued by a trust, limited liability company, or other similar entity; is designed to reflect the performance of one or more reference assets or an index of reference assets; is issued by a trust that holds (i) one or more commodities or commodity-based assets, and (ii) in addition may hold securities, cash, and cash equivalents; is issued by a trust in a specified aggregate minimum number in return for a deposit of (i) a specified quantity of the underlying commodities, commodity-based assets, securities, cash, and cash equivalents or (ii) a cash amount with a value based on the next determined net asset value per trust share; and when aggregated in the same specified minimum number, may be redeemed at a holder’s request.  Self-Regulatory Organizations; The Nasdaq Stock Market LLC; Cboe BZX Exchange, Inc.; NYSE Arca, Inc.; Order Granting Approval of Proposed Rule Change, as Modified by Amendments Thereto, to Adopt Generic Listing Standards for Commodity-Based Trust Shares, Exchange Act Release No. 103995 (Sept. 17, 2025), available at https://www.sec.gov/files/rules/sro/nasdaq/2025/34-103995.pdf.

[2] More specifically, NYSE Arca, Nasdaq, and Cboe BZX will be able to list eligible commodity- and crypto-based ETPs immediately so long as the ETPs’ registration statements are deemed effective by the SEC.

[3] See further comments from James M. Brady in Aislinn Keely, SEC Eases Path for Crypto ETPs With New Listing Rules, Law360 (Sept. 18, 2025), https://www.law360.com/articles/2389453/sec-eases-path-for-crypto-etps-with-new-listing-rules.

[4] Press Release, SEC, “SEC Approves Generic Listing Standards for Commodity-Based Trust Shares” (Sept. 17, 2025), available at: https://www.sec.gov/newsroom/press-releases/2025-121-sec-approves-generic-listing-standards-commodity-based-trust-shares.

[5] ETF means an open-end management investment company or a unit investment trust as defined in Section 4(2) of the Investment Company Act of 1940 (1940 Act) or series or class thereof, the shares of which are listed and traded on a national securities exchange, and that has formed and operates under an exemptive order under the 1940 Act or in reliance on an exemptive rule adopted by the SEC.

[6] Hester M. Peirce, Comm’r, SEC, “A Special Generic: Statement on Commission Approval of Generic Listing Standards for Commodity-Based ETPs” (Sept. 17, 2025), available at: https://www.sec.gov/newsroom/speeches-statements/peirce-statement-commodity-based-etps-091725.

[7] Suzanne McGee, SEC Paves Way for Crypto Spot ETFs With New Listing Rules, Reuters (Sept. 18, 2025), https://www.reuters.com/sustainability/boards-policy-regulation/sec-paves-way-crypto-spot-etfs-with-new-listing-rules-2025-09-18/; Sarah Wynn, ‘End of an Era:’ SEC Approval of Exchanges’ Listing Standards Marks Turning Point for Crypto ETFs, The Block (Sept. 18, 2025), https://www.theblock.co/post/371319/end-of-an-era-sec-approval-of-exchanges-listing-standards-marks-turning-point-for-crypto-etfs.

[8] Caroline A. Crenshaw, Comm’r, SEC, “Passing the Buck on Reviewing Proposals to List and Trade Digital Asset ETPs” (Sept. 17, 2025), available at: https://www.sec.gov/newsroom/speeches-statements/crenshaw-statement-commodity-based-etps-091725.

[9] For more information on the key developments from the SEC’s Project Crypto, see Katten's post here.

[10]Supra note 4.