2026-16460NoticeWallet

ISE Refines Security Criteria: Wall Street Shrugs

Published Date: 8/13/2026

Notice

Summary

No summary available.

Analyzed Economic Effects

4 provisions identified: 2 benefits, 0 costs, 2 mixed.

Exchange Listing of Options on Digital-Commodity ETFs

The Exchange proposes to allow listing and trading of options on Commodity-Based Trust Shares that hold ‘‘digital commodities’’ pursuant to Nasdaq Rule 5711(d), as amended. If the trust meets the initial criteria, the Exchange may list such options immediately on the national exchange without additional Commission approvals, giving investors another exchange-traded way to hedge exposure to those trusts.

Narrower 'Digital Commodity' Definition

The Exchange will replace the term ‘‘crypto asset’’ with the narrower term ‘‘digital commodity,’’ defined to require (i) that it be a commodity under the Commodity Exchange Act, (ii) that its value be intrinsically linked to the programmatic operation of a functional crypto system and market dynamics, and (iii) that its value not be derived from expectations of profits from others' managerial efforts. This definition excludes assets that would be classified as securities from qualifying as underlying digital commodities.

$700M Liquidity Threshold for Underlyings

To qualify as an underlying for options, each digital commodity held by the Commodity-Based Trust must have a total global supply with an average daily market value of at least $700 million over the last 12 months. The rulekeeper says this $700 million threshold ensures sufficient liquidity for creation/redemption and reliable options pricing.

85% Surveillance Requirement with 15% Buffer

The Exchange proposes that at least 85% of a trust's net asset value (NAV) must consist of digital commodities that underlie derivatives trading on a market with which the Exchange has a comprehensive surveillance sharing agreement; up to 15% of NAV may consist of digital commodities that do not meet that surveillance requirement. The Exchange says the 85% surveillance floor, combined with disclosure and liquidity rules, supports market surveillance and investor protection.

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Key Dates

Published Date
8/13/2026

Department and Agencies

Department
Independent Agency
Agency
Securities and Exchange Commission
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