by Scott Emick
4/8/25
In a significant policy shift, the U.S. Department of Justice (DOJ) has disbanded its National Cryptocurrency Enforcement Team (NCET) following an executive order from President Donald Trump. This move reflects the administration’s intent to reduce regulatory oversight in the digital assets sector and reposition the United States as a leader in the cryptocurrency industry.
Formation and Objectives of the NCET
Established in 2021 under the Biden administration, the NCET was tasked with investigating and prosecuting complex criminal activities involving cryptocurrencies. The unit focused on cases related to crypto exchanges, mixing services, and money laundering infrastructures. Notably, the NCET played a pivotal role in actions against entities like Binance, the crypto mixer Tornado Cash, and individuals such as Sam Bankman-Fried of FTX. The team’s efforts were instrumental in addressing the illicit use of digital assets and ensuring compliance within the rapidly evolving crypto landscape.
Policy Shift Under the Trump Administration
In January 2025, President Trump issued an executive order emphasizing the need for regulatory clarity in the digital assets sector. Deputy Attorney General Todd Blanche, in a memo obtained by Fortune, stated that the DOJ is “not a digital assets regulator” and criticized the previous administration’s approach as a “reckless strategy of regulation by prosecution.” Consequently, the NCET was disbanded “effective immediately” to align with the new directive.
Blanche instructed DOJ employees to shift their focus towards prosecuting individuals who defraud or exploit digital asset investors, rather than pursuing cases against cryptocurrency exchanges, mixers, and offline wallets. This realignment signifies a move towards addressing fraudulent activities directly impacting investors, while easing enforcement actions on crypto platforms.
Implications and Reactions
The dissolution of the NCET has elicited varied reactions. Proponents of the move argue that it fosters innovation and positions the U.S. as a more crypto-friendly environment. Critics, however, express concerns that reducing oversight may embolden illicit actors and compromise investor protection.
This policy shift is part of a broader trend under the Trump administration to ease regulatory pressures on the cryptocurrency industry. Notably, several regulatory lawsuits initiated under the previous administration have been dropped, benefiting companies like Coinbase, Kraken, OpenSea, and Robinhood. These actions underscore the administration’s commitment to reshaping federal oversight in favor of a more laissez-faire approach to digital assets.
Cases of Alleged Unjust Persecution
While the NCET was instrumental in tackling significant crypto-related crimes, there have been instances where its actions were perceived as overreaching. For example, the enforcement actions against certain crypto mixers and exchanges were criticized for potentially stifling innovation and penalizing platforms that were still navigating the nascent regulatory environment. However, specific cases of individuals being unjustly persecuted by the NCET are not well-documented in the available sources.
Conclusion
The DOJ’s decision to disband the NCET marks a pivotal change in the U.S. government’s approach to cryptocurrency regulation. By shifting focus from platform-centric enforcement to targeting individual fraudulent actors, the administration aims to balance fostering innovation with protecting investors. The long-term impact of this policy shift on the cryptocurrency landscape remains to be seen, as stakeholders continue to navigate the evolving regulatory terrain.
