The United States Justice Department has announced the disbandment of its National Cryptocurrency Enforcement Team (NCET), a unit previously tasked with investigating fraud linked to digital currencies. Deputy Attorney General Todd Blanche communicated this decision in a memo to department employees, highlighting a shift in oversight towards the cryptocurrency sector amid Donald Trump’s presidency, which is steering towards decreased regulatory measures concerning digital assets.
In the memo, Blanche emphasised the importance of the digital assets industry for the nation’s economic growth and innovation, asserting that the Justice Department does not serve as a regulator for cryptocurrencies. He critiqued the regulatory approach adopted by the previous Biden administration, branding it as a harmful “regulation by prosecution.”
The Justice Department will transition its focus away from regulatory enforcement actions affecting the digital currency sector, as outlined by an executive order established by Trump at the beginning of his second term. This order advocates for the facilitation of lawful blockchain use by individuals and private entities without government persecution.
Going forward, the Justice Department will concentrate on prosecuting individuals who exploit digital asset investors or use cryptocurrencies to engage in serious criminal activities such as terrorism, drug trafficking, and hacking. Ongoing investigations that do not align with this approach are expected to be terminated.
The NCET was created during the Biden administration, designed to combat the misuse of digital currencies. Comprised of specialists in cryptocurrency and cybercrime, the team handled a number of high-profile cases related to crypto fraud.
Trump’s administration has openly embraced the cryptocurrency market, promoting the notion of making the U.S. the “crypto capital of the planet” and advocating for more lenient regulations within the digital asset domain. His campaign for the presidency last year relied on financial support from cryptocurrency companies, and he and his family are reportedly engaged in launching a new crypto venture called World Liberty Financial.
Recent measures taken by Trump, including establishing a strategic cryptocurrency reserve for the United States and hosting discussions with cryptocurrency industry leaders at the White House, further underline his administration’s commitment to supporting the digital asset landscape.
In summary, the Justice Department is stepping back from active regulation of cryptocurrencies, instead directing efforts toward prosecuting fraudulent activities and serious crimes associated with digital assets, as part of a broader push to foster innovation in this burgeoning industry under Trump’s leadership.