Nasdaq Proposes Rule Change for Altcoins ETF: What This Means for Crypto Investors

Nasdaq has filed a proposed rule change with the U.S. Securities and Exchange Commission to expand its Nasdaq Crypto Index by adding four major altcoins—XRP, Solana, Cardano, and Stellar—to the Bitcoin and Ethereum lineup. 

This could be a turning point for the crypto market, broader ETF access, and mainstream investment. In this article, we explore what this proposal means for everyday crypto investors and the evolving ETF landscape.

What Nasdaq Is Proposing

On June 2, 2025, Nasdaq submitted a rule change proposal (Form 8‑K and Rule 19b‑4) to the SEC to pivot the Hashdex Nasdaq Crypto Index US ETF (NCIQ) from tracking only the Nasdaq Crypto US Settlement Price Index (Bitcoin and Ethereum) to the fuller Nasdaq Crypto Index with nine cryptocurrencies. 

The expanded benchmark would include XRP, Solana (SOL), Cardano (ADA), and Stellar (XLM), each known for unique use cases—from payments to scalable smart contracts. The public comment and SEC review period runs until November 2, 2025.

This move would allow NCIQ to directly hold these altcoins, reducing the current tracking error that arises because it can only hold Bitcoin and Ethereum. While Hashdex uses a sampling model to approximate the broader index performance, that workaround remains imperfect.

Why This Matters for Investors

Diversification

Adding altcoins offers broader exposure, which can help reduce risk. XRP is known for cross-border payment efficiency, Solana for scalable smart contracts, Cardano for research-led development, and Stellar for low-cost transactions.

Institutional Confidence

Inclusion in a Nasdaq-backed ETF could boost liquidity and price stability in these altcoins, as was seen with Bitcoin and Ethereum following their ETF approvals.

Regulatory Clarity

The SEC’s pending decision offers a form of regulatory validation. For example, a court ruling in April 2025 confirmed XRP is not a security, easing legal risk. The SEC’s review deadline is November 2, 2025.

Potential Risks and Limitations

The proposal doesn't guarantee approval. The SEC may raise concerns or seek more input. There’s also heightened volatility risk, especially for altcoins known for sharp price swings. Furthermore, until the rule change is approved, NCIQ won't immediately hold the new assets, which means tracking performance may not reflect the broader index.

Additionally, while Nasdaq emphasizes surveillance and investor protection in its filings under Section 6(b)(5) of the Securities Exchange Act, it’s still building trust in monitoring these newer digital assets.

How Investors Can Prepare

• Monitor SEC updates. The deadline is November 2, 2025—watch for approval, requests for more data, or public commentary.
   
• Understand tracking error. Existing NCIQ holdings may not mirror the expanded index until regulatory clearance.
   
• Consider diversification. A fully-approved, broader ETF could be a practical way for investors to gain multi‑asset crypto exposure.
   
• Evaluate risk tolerance. Altcoins may offer greater upside—but also increased volatility and potential liquidity risks.
   
• Watch pricing trends. Following the announcement, XRP and Solana saw noticeable price moves.
   

Broader Implications for Crypto ETFs and Market Dynamics

The proposal reflects growing interest in exotic and diversified ETFs, including those targeting memecoins and NFTs. It aligns with a wider movement toward mainstream integration of crypto. Nasdaq has also encouraged more efficient listing for spot crypto ETPs under federal law, arguing that the SEC should adopt more consistent frameworks for digital asset products . This could translate into faster approvals and broader access to crypto investment vehicles.

Conclusion

Nasdaq’s proposed rule change could be a pivotal step toward more inclusive, regulated exposure to altcoins via ETFs. If approved, the change would allow investment in XRP, Solana, Cardano, and Stellar—bringing diversification, regulatory clarity, and institutional access to the forefront. While approval isn’t guaranteed, investors can plan ahead by monitoring developments, understanding the differences between current and proposed ETF holdings, and assessing their own appetite for risk. In the evolving world of crypto, this could mark an important milestone toward mainstream adoption.

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FAQ

What is the Nasdaq Crypto Index?
A benchmark tracking the performance of select cryptocurrencies. Nasdaq is now proposing to expand it from six to nine assets by adding XRP, SOL, ADA, and XLM.

What’s the difference between NCI and NCIUS?
The Nasdaq Crypto Index (NCI) includes nine assets, while the Nasdaq Crypto US Settlement Price Index (NCIUS) only covers Bitcoin and Ethereum—due to U.S. regulatory limits.

What is NCIQ?
The Hashdex Nasdaq Crypto Index US ETF (ticker: NCIQ) is an ETF designed to track the Nasdaq Crypto Index. Current holdings are limited to Bitcoin and Ethereum until the proposed rule change is approved.

When will the SEC decide?
The SEC's review deadline is November 2, 2025, unless extended.

Can ordinary investors buy it now?
You can currently invest in NCIQ, which tracks Bitcoin and Ethereum. Full altcoin exposure depends on SEC approval of Nasdaq’s proposed rule.