In a landmark shift, the U.S. Justice Department is disbanding its National Cryptocurrency Enforcement Team (NCET). The decision aligns with President Trump’s executive order that directs federal agencies to foster open blockchain networks and cease aggressive regulatory actions against crypto firms.

Key Developments:

• Memo from Leadership:Deputy Attorney General Todd Blanche issued a memo instructing prosecutors to narrow the focus of crypto-related investigations strictly to:

  • Terrorism financing

  • Drug cartels and human trafficking networks

  • Organized crime and gang financing

  • Hacking activities and direct victimization of digital asset investors

    
    

• Wider Crypto-Friendly Agenda:Blanche, notably a former criminal defense attorney for Trump himself, emphasized ending what he called the Biden administration’s "reckless strategy of regulation by prosecution."

  • Trump’s administration views crypto as an engine for innovation rather than a threat.

  • The new policy directs prosecutors to close any ongoing investigations that don’t align with this narrowed scope.

    
    

Impact on Crypto Regulation:

• Federal regulators are pulling back across multiple fronts:

  • The Securities and Exchange Commission (SEC) is scaling down its crypto enforcement activities and has even paused some high-profile cases that once appeared to be heading toward resolution.

  • U.S. banking regulators have relaxed restrictions, now permitting some crypto activities.

    
    

• Enforcement will no longer target:

  • Exchanges

  • Offline wallets

  • Mixers and tumblers (privacy tools) ...unless there is clear, willful violation of laws or the end-users are committing explicit criminal acts.

    
    

Trump’s Personal Stake:

• Trump and his family now have financial interests in crypto:

  • The Trump family holds a claim on 75% of net revenues from token sales by World Liberty Financial, their crypto venture.

  • They have also launched "meme coins" like $TRUMP and $MELANIA, which are described not as investments, but as expressions of support.

• This policy reversal underlines Trump’s commitment to making the U.S. the “crypto capital of the planet.”

  
  

The disbanding of the NCET represents a monumental policy shift. The Justice Department’s realignment moving away from aggressive prosecutions toward a focus on violent crimes and explicit fraud — signals a more favorable environment for crypto businesses. Markets have responded positively, anticipating further pro-crypto developments. However, critics warn that reduced oversight could embolden bad actors.