WASHINGTON – The U.S. Department of Justice has abruptly shut down its specialized unit focused on cryptocurrency-related fraud, marking a significant policy shift as the Trump administration deepens its support for the digital asset industry.
In a memo issued late Monday, Deputy Attorney General Todd Blanche ordered the immediate dissolution of the National Cryptocurrency Enforcement Team (NCET). Prosecutors formerly assigned to the unit have been instructed to refocus efforts on transnational criminal organizations and terrorist networks that use digital currencies to finance illicit activities.
The decision aligns with President Donald Trump’s broader agenda to limit regulatory oversight of the cryptocurrency sector. It follows his Executive Order 14178, which emphasized the importance of providing regulatory “clarity and certainty” to foster innovation and growth in the digital economy.
“The Department of Justice is not a digital assets regulator,” Blanche wrote in his four-page directive. “The prior administration pursued a reckless strategy of regulation by prosecution. That era is over.”
Shift Away from White-Collar Enforcement
The DOJ’s move comes amid a wider realignment under the Trump administration to scale back enforcement of white-collar and financial crimes. Resources are now being redirected toward immigration-related offenses and drug trafficking.
Blanche, who previously served as a defense attorney for Trump, echoed the president’s messaging, stating the administration seeks to “end the regulatory weaponization against digital assets.”
Critics, however, caution that the decision could leave a dangerous enforcement gap. Nate Sibley, director of the Kleptocracy Initiative at the conservative Hudson Institute, warned on social media that disbanding the unit may hinder efforts to crack down on bad actors using crypto to bypass sanctions and launder money.
“Dangerous U.S. adversaries rely on cryptocurrencies to launder money and evade sanctions,” Sibley posted on X. “If this is accurate, hard to see how it squares with cracking down on cartel finances or sanctions on Iran.”
The NCET: A Brief History
Launched in February 2022, the National Cryptocurrency Enforcement Team was created to address the growing misuse of digital assets by criminals. It included experienced prosecutors from across the DOJ, including specialists in cybercrime, money laundering, and asset forfeiture.
The team’s mandate included targeting illicit activity on virtual currency exchanges and coordinating with domestic and international partners to address emerging threats in the digital asset space.
Now, those priorities are being scaled back. The DOJ’s Market Integrity and Major Frauds Unit will also end its cryptocurrency enforcement activities to focus on immigration-related and procurement fraud cases, Blanche said.
While the DOJ’s Computer Crime and Intellectual Property Section will continue to provide training and support, the Department’s overall posture is moving away from broad crypto enforcement.
Trump’s Crypto Vision
The move is consistent with Trump’s vocal embrace of the cryptocurrency sector since his return to the White House. On January 23 — just three days into his second term — Trump signed an executive order signaling a strategic pivot to support the industry and make the U.S. the “crypto capital of the planet.”
Throughout his campaign, Trump positioned himself as a pro-crypto candidate, winning significant support from digital asset firms frustrated by what they viewed as overreach by the Biden administration.
Shortly before assuming office, Trump also co-founded World Liberty Financial, a digital asset firm, alongside his sons and real estate magnate Steve Witkoff, who now serves as the administration’s Middle East envoy.
Adding to his crypto credentials, Trump launched his own cryptocurrency token, $TRUMP, just ahead of Inauguration Day. The memecoin soared in value — briefly exceeding $10 billion in market capitalization — before retreating amid scrutiny from ethics experts who raised concerns about conflicts of interest.
A Strategic Bitcoin Reserve
In another bold step, the administration announced the creation of a Strategic Bitcoin Reserve, positioning the U.S. government as an active participant in the crypto economy. The reserve, established last month, is led by Treasury Secretary Scott Bessent, alongside newly appointed Crypto Czar David Sacks and other top officials.
The reserve aims to strengthen the nation’s foothold in cryptocurrency and could lead to mainstream adoption of digital assets for payments.
With regulatory enforcement cooling and the White House setting an enthusiastic tone, digital currency advocates see a rare opportunity.
Whether this pivot unleashes a new era of innovation or opens the door to increased abuse remains to be seen.
