Nasdaq has reconfigured its Crypto US Settlement Price Index (NCIUS) as of June 2, 2025, adding XRP, Cardano (ADA), Solana (SOL), and Stellar Lumens (XLM) to the original basket of bitcoin (BTC) and ether (ETH). The update was disclosed in a regulatory filing submitted by the Hashdex Nasdaq Crypto Index US ETF (ticker: NCIQ) to the U.S. Securities and Exchange Commission (SEC) on June 6. This marks a significant step toward broader institutional acceptance of digital assets beyond the two largest cryptocurrencies.
Index Expansion Details
The NCIUS is a rules-based benchmark index operated by Nasdaq Inc. that calculates a daily settlement price for selected digital assets. According to the filing, the index introduced four additional constituents beginning June 2, reflecting Nasdaq's ongoing effort to align the index with market developments and investor demand. Notably, XRP was already included in the broader Nasdaq Crypto Index (NCI) on June 3, 2024, which also covers Chainlink (LINK), Litecoin (LTC), and Uniswap (UNI). The NCI currently comprises nine assets: BTC, ETH, XRP, SOL, ADA, XLM, LINK, LTC, and UNI.
Tracking Error Concerns for NCIQ ETF
Despite the index expansion, the Hashdex NCIQ ETF operates under existing regulatory constraints that limit its holdings to only bitcoin and ether. As the SEC filing explicitly states: "Under current regulatory restrictions, the Trust is only permitted to hold bitcoin and ether, and is not permitted to hold the new index constituents and, as such, the risk of potential tracking error is increased." This mismatch between the fund's actual holdings and the benchmark creates a structural risk: the ETF's performance may deviate significantly from the index it purports to track, especially during periods of high volatility in the newly added assets.
To address this, Nasdaq submitted a separate proposed rule change to the SEC on March 7, 2025, seeking permission for the NCIQ ETF to adopt the broader Nasdaq Crypto Index (NCI) as its official benchmark. If approved, the ETF would also be authorized to hold all constituents of the NCI—currently nine assets—thereby eliminating the tracking error issue. The SEC is expected to issue a final decision by November 2, 2025.
Market and Regulatory Implications
This development comes amid a broader push for regulated crypto investment vehicles in the U.S. Hashdex, a leading Brazilian asset manager with a strong track record in crypto ETFs, has positioned NCIQ as a bridge between traditional finance and digital assets. The inclusion of XRP and other altcoins in a Nasdaq index signals a gradual softening of regulatory resistance, though the SEC's stance remains cautious. Market participants are watching the November deadline closely, as approval would not only benefit NCIQ but also set a precedent for multi-asset crypto ETFs in the U.S.
Analysts note that the expanded index provides a more accurate representation of the crypto market, which could attract institutional investors seeking diversified exposure within a regulated framework. However, the current mismatch highlights the limitations of existing regulatory boundaries. Until the SEC rules on the proposed benchmark change, NCIQ investors must accept the elevated tracking error risk. The outcome will likely influence the trajectory of future crypto ETF product designs and the broader integration of digital assets into mainstream finance.