Trump Administration Reduces Cryptocurrency Enforcement Measures
April 8, 2025 — Washington, D.C.
In a significant shift of policy, the Trump administration has announced the disbandment of the National Cryptocurrency Enforcement Team (NCET), a unit previously dedicated to enforcing regulations within the cryptocurrency sector. This decision follows directives from Deputy Attorney General Todd Blanche, as reported by ABC News.
Changes in Enforcement Strategy
The new memo from the Justice Department instructs federal prosecutors to relax their approach towards prosecution related to cryptocurrencies. Prosecutors are now advised "no longer [to] target virtual currency exchanges, mixing and tumbling services, and offline wallets for the acts of their end users or unwitting violations of regulations." This marks a notable departure from the more aggressive tactics adopted under the previous administration.
According to the memo, the Justice Department clarified its position stating, "The Department of Justice is not a digital assets regulator." This change reflects a broader agenda to focus ongoing investigations on serious criminal cases that use digital assets to facilitate illegal activities, including terrorism, drug trafficking, and organized crime.
Criticism of Previous Administration’s Approach
Deputy Attorney General Blanche criticized the Biden administration’s enforcement strategy, claiming it was characterized by "reckless regulation by prosecution." He emphasized that future prosecutions under the Trump administration would primarily target individuals who defraud digital asset investors or those engaged in serious crimes using digital assets.
The memo also implies that several prominent crypto cases previously initiated—including investigations into Tornado Cash, which allegedly laundered over $1 billion, and the hacking case involving Avraham Eisenberg, convicted in 2024 for market manipulation—may be deprioritized as enforcement under the new guidelines evolves.
Reevaluation of Victim Compensation
Blanche also indicated a need to reevaluate how victims of cryptocurrency fraud are compensated. Citing the case of Sam Bankman-Fried, who was accused of orchestrating a large financial fraud, Blanche argued that many victims were only able to recover the value of their assets at the time of the fraudulent acts, which were at a lower market point. This situation leaves victims without the opportunity to benefit from any subsequent gains in the digital asset market, highlighting a significant issue in measuring investor losses.
In alignment with these new directives, Blanche called for a change in the prosecution’s approach to better account for victims’ interests, particularly in complex financial fraud cases.
Implications for the Cryptocurrency Industry
This policy change reflects President Trump’s pro-cryptocurrency stance, which has been evident since his presidency. The administration’s relaxed approach towards crypto regulations aligns with earlier orders to the Securities and Exchange Commission and the Commodity Futures Trading Commission to ease regulatory pressures on the industry.
As the cryptocurrency landscape continues to evolve, stakeholders within the sector will be observing how these changes affect regulatory practices and criminal prosecution in the coming months.
A spokesman for the U.S. Attorney’s Office in Manhattan declined to comment on the new directives, indicating a potentially quieter period of enforcement activity concerning cryptocurrency.
For ongoing updates and analysis on this evolving story, stay tuned to ABC News.
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