The U.S. Department of Justice has shut down its National Crypto Enforcement Team. The agency informed its staff on Monday. A memo from Deputy Attorney General Todd Blanche confirmed the decision. He stated that the Justice Department should not act as a digital asset regulator.
The action comes in the wake of a January executive order by President Trump. The order demanded clear regulations for the digital asset sector. Blanche explained that the unit shut down immediately. He instructed staff to change their priorities. They will now focus on fraud toward investors in crypto.
DOJ shifts crypto policy, avoids exchanges
The department will refrain from taking enforcement actions against exchanges, mixers, and cold wallets. NCET started in 2021 under the administration of President Biden. These are also prosecutors from cybercrime units as well as money laundering units. They also collaborated with attorneys in other branches of the DOJ. They dealt with significant cases of crypto crime together.
These included the Tornado Cash inquiry. That operation laundered cryptocurrency in order to conceal owners. They also pursued Avraham Eisenberg, who distorted a cryptocurrency protocol and stole over $100 million. They also followed money associated with North Korean entities.
The Department of Justice had nothing additional to say. It simply provided a public link to the memo. It is a change in direction in federal cryptocurrency policy. The Trump administration relaxed supervision of the sector. Others, including the SEC and CFTC, also come under new restrictions.
Trump’s new U.S. crypto reserve
Trump embraced digital assets in full. In March, he instructed the establishment of a U.S. crypto reserve. Later, he received leaders in Washington. Those leaders of cryptocurrency discussed laws and industry objectives. The initiative was a sign of increased support for cryptocurrency in the top leadership.
The DOJ’s move is reflective of that change. Enforcement is now aimed at harming investors rather than the instruments by which they are harmed. The memo marks a shift away from sweeping crackdowns and toward more selective actions. Some in the industry view it as a victory. Others fear that it will erode controls too far.
The dissolution of NCET closes one chapter of crypto law enforcement. It also demonstrates how quickly U.S. policy can change under a new administration. Whatever is next for crypto regulation will rely on both Congress and the courts. For now, the Justice Department will pursue a more limited approach. Crypto in America starts the next chapter.
