Senator Toomey's letter to Chair Gensler sets forth a series of tough questions as to the legal theories that justify the SEC's acts and omissions with respect to digital assets. The questions posed are challenging and fair. After all, the regulator's statements have a huge impact on a trillion-dollar plus market of assets held by millions of U.S. investors. 

Where there is a degree of bipartisan support for the development of digital asset technology, there is hope for legislation that might establish clear jurisdictional boundaries for regulatory authority over various types of digital assets, (see, e.g., the  and this ).

Until either the SEC or Congress provides more substantial guidance as to the treatment of various digital assets under the securities laws, there is a ceiling on the CFTC's ability to oversee the digital asset markets. The fact that the CFTC is holding itself out as the principal regulator of these markets may motivate the SEC to propose some clearer jurisdictional lines, for fear that Congress may determine (see, e.g., the ) that the only way forward is to give the CFTC much broader…

Rule 15c2-11 had been in place for approximately 50 years and had always been understood only to apply to equity securities. The current SEC "realized" that the rule, read literally, applied to debt securities and determined to apply it to such securities Because the rule was not written to apply to debt securities, and certainly not to Rule 144A debt securities, the SEC has postponed the application and, to .

That is not how the rulemaking process should work. If the SEC believes…