Justice Department Shifts Focus from Cryptocurrency Investigations Under Trump Administration
Published On 8 Apr 2025
The United States Department of Justice (DOJ) has announced a significant shift in its approach to cryptocurrency investigations, moving away from fraud probes and redirecting resources toward issues such as immigration enforcement, terrorism, and drug trafficking. This decision aligns with President Donald Trump’s commitment to reducing regulatory scrutiny of the cryptocurrency industry.
Change in Enforcement Strategy
In a memo released late Monday, Deputy Attorney General Todd Blanche outlined the new direction, emphasizing that the DOJ would no longer consider digital assets a primary focus for enforcement actions. Blanche cited President Trump’s policy to "end the regulatory weaponization" of cryptocurrencies, indicating a substantial departure from previous regulatory approaches.
“The Department of Justice is not a digital assets regulator,” Blanche stated in the memo. He further underlined that the DOJ would dismantle its National Cryptocurrency Enforcement Team (NCET), which had been established in February 2022 to address cases of fraud and illicit financial schemes.
Background and Previous Activities of NCET
Since its inception, NCET accomplished notable legal actions, including its first conviction in a cryptocurrency market manipulation case involving Avraham Eisenberg, who was found guilty of fraud after manipulating cryptocurrency prices to amass roughly $110 million. The enforcement team was also engaged in high-profile investigations targeting companies such as Binance and Tornado Cash, the latter facing accusations of facilitating money laundering for North Korea.
In his memo, Blanche criticized the previous administration’s approach, describing it as "a reckless strategy of regulation by prosecution." As Trump seeks to distance himself from the Biden administration’s cryptocurrency policies, the new direction signals a broader intention to promote digital currencies.
Executive Actions and Future Directions
Following his return to the White House for a second term, Trump wasted no time in rolling out Executive Order 14178, titled “Strengthening American leadership in digital finance technology.” This order revoked Biden-era directives aimed at regulating the cryptocurrency sector and instead proposed the development of a national digital asset stockpile.
Recently, Trump announced a national strategic reserve for cryptocurrency, designating five major currencies—XRP, Cardano, Solana, Bitcoin, and Ethereum—as part of this reserve, which led to a brief surge in their market values.
Trump’s advocacy for cryptocurrency has further solidified his self-proclaimed title as the "crypto president," as he continues to engage with industry leaders and advocate for a more favorable regulatory environment. Notably, a meeting at the White House on March 7, called the “first-ever White House Digital Assets Summit,” showcased Trump’s commitment to positioning the U.S. as a leader in the global cryptocurrency landscape.
Narrowing of Focus on Illicit Activities
While the DOJ plans to largely step back from most cryptocurrency-related enforcement, Blanche noted that some investigations would remain a priority, specifically those linked to illegal activities that inflict financial harm on investors and empower criminal enterprises, such as cartels and human trafficking operations that are increasingly utilizing digital currencies.
"Cartels and human trafficking and smuggling rings have increasingly turned to digital assets to fund their operations and launder the proceeds of their illicit businesses," Blanche noted. However, he clarified that criminal investigations would not target the platforms used by these organizations to facilitate their illegal activities.
This shift marks a pivotal moment in U.S. cryptocurrency regulation under Trump’s leadership, indicating a potential for increased growth and entrepreneurial activity in the digital currency sector, while maintaining a focus on addressing serious criminal uses of these technologies.
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