U.S. Justice Department Shuts Down Key Crypto Team Under Trump

In a shift for the crypto industry, the U.S. Justice Department has decided to shut down its National Cryptocurrency Enforcement Team (NCET). This move marks a turning point in how the government handles digital assets. The memo, seen by Reuters, shows a significant change in direction from the Biden-era policy, especially under the new Trump administration.

Focus Shifts to Crime, Not Regulation

Deputy Attorney General Todd Blanche sent a memo of new guidelines on crypto investigations to federal prosecutors. Instead of slamming the crypto industry for every single mistake, he told them to concentrate on serious crimes like terrorism, drug dealings, human trafficking, etc. 

The Justice Department wants to target cases of individuals who utilize digital assets to commit offenses or directly harm investors.

Blanche, who was confirmed recently as the No. 2 official in the department, stated that any investigations not aligned with this new policy “should be closed.” This change suggests the administration is less interested in going after crypto companies for regulatory technicalities and more focused on criminals misusing digital currencies.

Ending Regulation by Prosecution

The NCET was created in 2022 under the Biden administration to fight crypto-related fraud and illegal finance. It was involved in high-profile investigations, including the case against Binance and its founder, Changpeng Zhao. Zhao later pleaded guilty to money laundering law violations.

But Blanche, a former criminal defense attorney for Trump, criticized the previous administration’s approach as a “reckless strategy of regulation by prosecution.” His memo signals a clear departure from that strategy. Instead, he wants to ensure companies or individuals are only charged when there’s proof of willful violations of licensing or registration rules.

Protecting Blockchain Freedom

Blanche cited one of Trump’s executive orders as a foundation for this new direction. That order supports open access to blockchain networks without fear of punishment. It aligns with Trump’s campaign promises in 2024, where he spoke about making the U.S. the “crypto capital of the planet.”

Since Trump took office, regulators have already begun pulling back from strict crypto oversight. For example, the Securities and Exchange Commission has paused some of its well-known cases. A banking regulator has also given banks more freedom to take part in crypto activities.

Blanche’s memo adds that the Justice Department will no longer target crypto exchanges, mixers, offline wallets, or tumblers simply because of how their users behave or due to accidental regulatory breaches.

Trump’s Personal Crypto Ties

Trump’s growing interest in crypto isn’t just political—it’s personal. Reuters reported that the Trump family holds a 75% claim on net revenues from token sales by World Liberty Financial, a crypto company. Before his inauguration, Trump even launched his own crypto tokens, such as $TRUMP and $MELANIA. The creators of these “meme coins” say they are not investments or securities but simply a way for people to show their support.

As this new crypto-friendly policy unfolds, it’s clear that the digital asset world is entering a new chapter under the Trump administration.