DOJ Shuts Down Crypto Fraud Unit, Aligns with Trump’s Digital Asset Stance

America's Justice Department Shuts Down Its Cryptocurrency Fraud Unit

  • The Justice Department has disbanded its cryptocurrency fraud investigation unit, following new directives to align with President Trump’s pro-crypto agenda.
  • Resources will be redirected toward investigating transnational criminal organizations and terrorist groups using crypto for illegal activities.
  • The Trump administration has taken multiple pro-cryptocurrency actions, including creating a federal Strategic Bitcoin Reserve and easing regulations on crypto firms.

The U.S. Justice Department has eliminated its cryptocurrency fraud investigation unit with immediate effect, according to USA Today. Deputy Attorney General Todd Blanche issued a memo Monday night directing the closure of the National Cryptocurrency Enforcement Team, instructing prosecutors to redirect their focus toward transnational criminal groups and terrorist organizations using cryptocurrency for illegal transactions.

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The four-page memo explained that the change brings the Justice Department in alignment with President Trump’s Executive Order 14178, which emphasizes the importance of regulatory clarity to support innovation in digital assets. Blanche, who previously served as one of Trump’s defense attorneys, noted that the president has explicitly stated his intention to end “regulatory weaponization against digital assets.”

The DOJ’s Market Integrity and Major Frauds Unit will similarly cease cryptocurrency enforcement activities to focus on other administration priorities, including immigration and procurement fraud. Yesha Yadav, a Vanderbilt University law professor who specializes in cryptocurrency regulation, told The Washington Post: “It’s hard to underestimate the importance this task force has had… in pursuing some really huge crypto hacks and cases.”

Critics Raise National Security Concerns

Some experts have expressed alarm about potential security implications. Nate Sibley, an anti-corruption expert at the conservative Hudson Institute, stated on X: “Dangerous US adversaries rely on cryptocurrencies to launder money and evade sanctions. If this is accurate, hard to see how it squares with — for example — cracking down on cartel finances or maximum pressure sanctions on Iran.”

The policy shift comes amid scrutiny of Trump’s personal financial interests in cryptocurrency. The president’s “memecoin” surged from under $10 before his inauguration to as high as $74.59 shortly after, prompting ethics experts to raise conflict of interest concerns regarding his pro-crypto policies.

Broader Pro-Cryptocurrency Agenda

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This action represents just one component of the administration’s broader cryptocurrency support. Last month, Trump signed an order establishing a federal Strategic Bitcoin Reserve. The Securities and Exchange Commission has dropped more than a dozen cases against crypto firms since the White House’s first-ever crypto summit in March.

Meanwhile, executives from cryptocurrency exchange Binance recently met with Treasury Department officials seeking removal of a U.S. monitor overseeing their compliance with anti-money-laundering laws, according to The Wall Street Journal. The same report indicates that Binance is exploring a deal with the Trump family to list a new dollar-pegged stablecoin, potentially generating billions in profits for the family.

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