The U.S. Department of Justice (DOJ) has announced plans to disband its National Cryptocurrency Enforcement Team (NCET), a specialized unit launched to investigate and prosecute criminal activity involving digital assets. The move, confirmed in an internal memo from Deputy Attorney General Todd Blanche, has triggered widespread concern among regulators, lawmakers, and investor protection advocates who fear it signals a retreat from serious oversight of the crypto industry.
The NCET was established in 2021 to combat illicit use of cryptocurrencies in crimes such as money laundering, ransomware, market manipulation, and sanctions evasion. The unit played a critical role in several high-profile cases, including the takedown of darknet marketplaces, the prosecution of fraudulent token issuers, and the seizure of billions of dollars in stolen crypto.
According to sources familiar with the matter, the DOJ’s decision stems from a broader reorganization strategy aimed at “streamlining enforcement priorities” across divisions. Some of the NCET’s functions will reportedly be absorbed by existing cybercrime and financial fraud teams, but critics argue this change represents a significant dilution of focus and expertise.
“This is a step backward,” said a former DOJ official who worked closely with the NCET. “Cryptocurrency crime is not just cybercrime. It involves complex financial systems, blockchain forensics, and global coordination. Disbanding this team sends the wrong message to bad actors.”
The announcement comes at a time when digital asset crime remains a persistent threat. Chainalysis and other blockchain analytics firms have reported billions in losses from hacks, rug pulls, and scams in the past year alone. With enforcement efforts already stretched thin, the loss of a dedicated crypto team raises questions about the government’s ability to keep pace with evolving threats.
Investor protection groups echoed these concerns, warning that without a centralized unit like NCET, the DOJ’s crypto-related cases may fall through the cracks. “This could create an enforcement vacuum,” said one consumer advocacy group. “And it will be the average investor who pays the price.”
On the other side of the debate, some industry insiders welcomed the move, claiming that the DOJ’s aggressive posture toward digital assets in recent years has created a climate of fear and uncertainty. “The U.S. crypto industry has been operating under regulatory siege,” said a prominent crypto venture capitalist. “We need clear rules, not more crackdowns.”
Still, the disbandment of the NCET comes as a surprise to many, especially as lawmakers and regulators are pushing for greater oversight of the crypto space. The Securities and Exchange Commission (SEC), Commodity Futures Trading Commission (CFTC), and state-level agencies have all ramped up enforcement in recent months, but without federal criminal prosecution capacity, their efforts may lack sufficient teeth.
As the DOJ transitions away from NCET, it remains unclear how it plans to maintain a strong crypto crime deterrent. For now, the move appears to be a significant shift in policy—one that could reshape the U.S. government’s approach to digital asset regulation and enforcement in the years ahead.
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