The U.S. Justice Department is dismantling its National Cryptocurrency Enforcement Team and redirecting efforts toward criminal investigations involving terrorism, cartels, hacking, and human trafficking financed by digital currencies, according to a new internal memo.
Deputy Attorney General Todd Blanche, recently confirmed to the department’s No. 2 position and a former criminal defense lawyer for President Donald Trump, issued the directive late Monday. In the memo, Blanche criticized the previous Biden administration’s “reckless strategy of regulation by prosecution” and outlined a sharp policy pivot.
Under the new approach, prosecutors are instructed to prioritize cases targeting individuals who exploit digital assets to commit crimes, rather than focusing on the broader digital asset sector itself. Ongoing investigations that do not align with this new strategy are to be closed, Blanche stated.
The Justice Department will no longer pursue virtual currency exchanges, mixing and tumbling services, or offline wallets for regulatory breaches committed by their users. Regulatory violation charges under federal banking, securities, or commodities laws must now show clear evidence of willful misconduct by a company or individual before proceeding.
The policy shift follows an executive order by President Trump, aimed at ensuring open access to blockchain networks without government interference. The move also comes as Trump continues to advocate for lighter regulation of the digital asset industry, where he maintains personal financial interests.
Trump’s family has a major stake in World Liberty Financial, a crypto venture tied to 75% of net revenues from token sales and recently supported the launch of $TRUMP and $MELANIA crypto tokens.
