Nasdaq has adopted a rule amendment that raises the initial listing standards for Special Purpose Acquisition Companies (SPACs) on the Nasdaq Capital Market. The updated requirements set higher thresholds for size, liquidity, and investor distribution, and reflect a broader shift by U.S. exchanges toward more selective listing standards. While the revisions primarily apply to the Nasdaq Capital Market, Nasdaq also increased certain thresholds for its Global Market tier.
For SPAC sponsors and companies preparing for an IPO, these changes shift focus toward upfront deal preparation and long-term listing viability, with exchanges emphasizing stronger initial positioning to support post-transaction listing compliance.
SPACs Will Face a Higher Bar for Size, Liquidity and Distribution
Under the updated requirements, SPACs seeking to list on the Nasdaq Capital Market will need to have larger offerings, more stock in public hands, and a broader base of shareholders to qualify for listing.
The new SPAC initial listing criteria include:
- Market Value of Listed Securities (MVLS) increases from $50 million to $75 million (Nasdaq Global Market threshold increased to $100 million).
- Market Value of Unrestricted Publicly Held Shares (MVUPHS) increases from $15 million to $20 million.
- Required active market makers increase from three to four.
- The minimum shareholder distribution requirement increases from 300 round lot holders to 400 public shareholders.
With average sizes well above the revised minimums, recent SPAC IPO data suggests the new Nasdaq thresholds are unlikely to constrain market activity and instead primarily affect the lower end of the SPAC size spectrum. The more consequential shift could be the heightened shareholder and market-maker requirements, requiring sponsors to establish a broader shareholder base and secure market-maker commitments earlier in the capital formation process.
More Stringent Continued Listing Standards on the Horizon
Both the Nasdaq Capital Market and NYSE American have proposed additional rules that would further tighten standards:
- Nasdaq Capital Market has proposed a $5 million minimum Market Value of Listed Securities. Companies falling below that level for 30 consecutive trading days would face immediate suspension with limited prospects for appeal.
- NYSE American has proposed raising the minimum trading price from $0.10 to $0.25 (effective October 1, 2026) and adding discretionary delisting authority for sharp price declines. Notably, the proposal no longer includes the previously proposed $5 million market-capitalization trigger.
These proposals have passed the comment period but remain pending. Grassi will continue to monitor these developments and their impact on SPAC sponsors, public companies, and growth-stage issuers.
Preparing for New SPAC Requirements
These changes reinforce the importance of aligning SPAC structure and strategy with both initial listing standards and anticipated post-transaction requirements.
For SPAC sponsors, key considerations include:
- Build investor base and market-maker relationships well ahead of any listing application or compliance review.
- Confirm that investor commitments and market-maker support meet the updated listing criteria.
- Plan for higher sustained requirements around market value and public float beyond the initial listing, particularly following a de-SPAC transaction. Consider adequate supplemental sources of capital (PIPE, SEPAs, etc.) concurrent with the closing de-SPAC transaction.
- Assess whether the current deal structure, including target profile and expected post-merger valuation, aligns with the proposed thresholds. Proactively plan for a sufficient investor relations strategy pre-close.
- Evaluate whether Nasdaq Capital Market or NYSE American may be a better fit based on how each exchange’s proposed requirements apply, including Nasdaq’s focus on market value thresholds versus NYSE’s emphasis on trading price and discretionary delisting.
For those evaluating IPO readiness or listing strategy, consulting with an experienced capital markets advisor early in the process can help clarify the best path forward.
Stay Ahead of Evolving Listing Standards with Grassi
Grassi’s SEC & Capital Markets team advises SPAC sponsors, micro-cap issuers and public companies through every phase of the listing process. From IPO readiness and PCAOB audits to SEC reporting, compliance, and capital markets advisory, we help clients understand where they stand, evaluate their options, and act with confidence as requirements evolve.
To discuss how these changes may affect your IPO timing, structure or listing strategy, reach out to a Grassi advisor today.
Frequently Asked Questions
Q: What are the new Nasdaq SPAC initial listing requirements for 2026?
A: Nasdaq has increased key SPAC listing thresholds on the Capital Market, including minimum market value (MVLS), public float (MVUPHS), number of shareholders, and required market makers. These changes raise the bar for deal size, investor distribution, and liquidity at the time of listing.
Q: How do the new rules affect SPAC IPO planning?
A: The updated requirements require sponsors to align deal size, investor base, and market support with higher listing thresholds earlier in the IPO process.
Q: What are MVLS and MVUPHS?
A: Market Value of Listed Securities (MVLS) refers to the total value of listed shares. Market Value of Unrestricted Publicly Held Shares (MVUPHS) refers to the portion of shares held by public investors and available for trading.
Q: How should SPAC sponsors prepare for these changes?
A: Sponsors should evaluate how pending exchange rules may affect post-de-SPAC listing viability, including whether Nasdaq Capital Markets or NYSE American requirements better align with the target company’s size, valuation, and expected trading profile.
