The Department of Justice has officially pulled the plug on its crypto enforcement unit. This is a major shift in how the U.S. government will handle digital asset cases under President Trump. The move, confirmed in a Monday night memo obtained by CoinDesk, disbands the National Cryptocurrency Enforcement Team (NCET) with immediate effect—and sends a clear message: the DOJ is no longer in the business of regulating crypto.
Memo Orders End to “Regulation by Prosecution”
In a four-page memo titled “Ending Regulation by Prosecution”, U.S. Deputy Attorney General Todd Blanche told staff the DOJ would no longer pursue regulatory-style cases against crypto exchanges, wallet providers, or other platforms unless clear criminal intent is involved. “The Department of Justice is not a digital assets regulator,” Blanche wrote, slamming the previous administration’s enforcement-led approach as “ill conceived and poorly executed.”
Staff were instructed to focus solely on cases involving investor harm, fraud, terrorism financing, or other criminal activity. Blanche added that any ongoing investigations inconsistent with the new policy should be shut down, and that his office will work with DOJ’s criminal division to review open cases for alignment.
Trump’s Team Widens Effort to Dismantle Crypto Watchdogs
This is just the latest rollback under Trump’s second term. Following his January executive order promising “regulatory clarity,” both the DOJ and the CFTC have trimmed or dismantled crypto-specific task forces. Acting CFTC Chair Caroline Pham recently consolidated enforcement into two units, aiming to boost efficiency and reduce what she called “regulation by enforcement.”
The NCET played a key role in major crypto crackdowns over the past few years, including cases against Tornado Cash developers and Mango Markets exploiter Avi Eisenberg—who faces sentencing this week.
What This Means for Investors
For crypto investors, this shift could mean fewer surprise prosecutions—but also more uncertainty. Regulatory clarity may come, but not from the DOJ. Enforcement will now hinge on whether fraud or criminal intent is involved.
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