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The U.S. Department of Justice has officially shut down its crypto enforcement unit, marking a shift in how federal agencies will approach digital assets. The decision follows a directive from President Donald Trump’s January executive order that called for more clarity and certainty in crypto regulation.
In a memo titled “Ending Regulation by Prosecution,” Deputy Attorney General Todd Blanche told staff on Monday that the National Cryptocurrency Enforcement Team (NCET) was being disbanded with immediate effect. The unit had been created in 2022 during the Biden administration to lead federal crypto investigations.
“The Department of Justice is not a digital assets regulator,” Blanche wrote in his four-page memo. “However, the prior Administration used the Justice Department to pursue a reckless strategy of regulation by prosecution, which was ill conceived and poorly executed. The Justice Department will no longer pursue litigation or enforcement actions that have the effect of superimposing regulatory frameworks on digital assets while President Trump’s actual regulators do this work outside the punitive criminal justice framework.”
The DOJ will no longer pursue cases against crypto exchanges, wallet providers, or mixers for the actions of their users or for unintentional breaches of regulation. That includes alleged violations of the Bank Secrecy Act, unlicensed money transmission, and federal securities or commodities laws.
Blanche said the department will instead focus on individuals who use crypto for illegal activity, including terrorism financing, gang operations, or scams targeting digital asset investors.
“Ongoing investigations that are inconsistent with the foregoing should be closed,” Blanche stated. His office will work with the DOJ’s criminal division to assess and review existing cases under the new policy.
The NCET is not the only task force affected by the Trump administration’s new stance. The U.S. Commodity Futures Trading Commission has also cut down its specialized enforcement teams, including those focused on crypto, to just two units. Acting Chair Caroline Pham said the goal is to boost efficiency and stop the practice of regulating by enforcement.