A group of US Democratic lawmakers, led by Senator Elizabeth Warren, has strongly criticized the Department of Justice (DOJ) for shutting down its National Cryptocurrency Enforcement Team (NCET). The NCET was disbanded on April 7, and the lawmakers expressed concern that this move undermines efforts to combat growing criminal activity tied to digital assets. The unit, which was formed to target criminal activity in the digital asset sector, led high-profile crackdowns against entities such as Tornado Cash and cybercriminals linked to North Korea. However, Deputy Attorney General Todd Blanche stated that the decision allows the DOJ to redirect its focus toward individual offenders rather than treating the entire crypto industry as a threat.
New guidance from the DOJ reportedly encourages less scrutiny on crypto exchanges, wallets, and mixers unless directly linked to criminal behavior. Despite these explanations, lawmakers argue that dismantling the NCET poses serious risks. They believe that the task force played a vital role in helping local and state authorities tackle complex crypto crimes, as many of them lack the resources or expertise to do so on their own. Without federal support, enforcement against threats like sanctions evasion, drug trafficking, and online scams could weaken significantly. The lawmakers stressed the importance of holding bad actors, including crypto ATM operators and other enablers of illicit finance, accountable.
The lawmakers’ letter to the DOJ also referenced FBI data showing that crypto fraud surged to $5.6 billion in 2023, marking a 45% increase from the previous year. This data reinforces the need for a specialized federal unit to address cryptocurrency-based crime. The lawmakers called on the DOJ to reverse its decision to disband the NCET, labeling it a misguided shift that undermines crime prevention efforts. They also requested a detailed staff briefing by May 1, 2025, to better understand the rationale behind the change. Additionally, they questioned whether political considerations, specifically President Donald Trump’s involvement with various crypto projects, played a role in the DOJ’s decision.
In conclusion, the Democratic lawmakers believe that dismantling the NCET is a mistake that could ultimately support sanctions evasion, drug trafficking, scams, and child sexual exploitation. They are concerned that the decision to disband the unit may be influenced by President Trump’s interest in cryptocurrency projects, potentially easing law enforcement scrutiny in that area. The lawmakers are urging the DOJ to reconsider its decision and reinstate the NCET to continue its critical role in fighting cryptocurrency-based crime. The future impact of this decision on efforts to combat criminal activity in the digital asset sector remains to be seen.
