The Justice Department (DoJ) began dismantling the unit investigating crypto-related fraud, saying it is not its job to regulate the industry. 

The crypto community celebrated the news as the digital asset market rebounded 7% after weeks of steep price drops.

Disbanding the DoJ’s crypto enforcement unit was one of many promises U.S. President Donald Trump made during his election campaign to ease oversight of the digital asset sector.

“The Department of Justice is not a digital assets regulator,” said Deputy Attorney General Todd Blanche in a four-page memo he sent to prosecutors this week. “The National Cryptocurrency Enforcement Team (NCET) shall be disbanded effective immediately.”

“The digital assets industry is critical to the nation’s economic development and innovation,” said Blanche, who represented Trump in the 2024 criminal trial that led to the president’s conviction on 34 felony charges of falsifying business records

The measure is a Trump administration objective to bolster the cryptocurrency sector by reversing Joe Biden’s crackdown on the industry´s alleged criminals and positioning the US as the leading crypto hub worldwide. 

Trump’s crypto-promises also led to the Securities and Exchange Commission’s (SEC) suspension of its high-profile lawsuit against the world’s largest crypto exchange, Binance, two months ago. 

The Biden-era SEC landed a significant blow against Binance last year, charging it with mishandling user funds and violating securities laws, which saw the exchange’s CEO, Zhao Changpeng, behind bars for four months until last September.

A reckless regulatory strategy

Blanche accused the Biden administration of using the DoJ to “pursue a reckless strategy of regulation by prosecution, which was ill-conceived and poorly executed.” 

The attorney general said the DoJ will still target individuals and organisations that defraud cryptocurrency investors or use crypto to fund criminal activities such as terrorism, human trafficking, or other criminal activities, but never to stifle the sector’s growth and innovation.

The crypto and blockchain community, which donated millions of dollars to help Trump win the presidency, long complained that the Biden government unfairly pursued innocent people with criminal or civil enforcement actions.

Praising Blanche’s memo on X, Coin Center advocacy group executive director, Peter Van Valkenburgh, said, “We should be going after bad guys. Not the developers of good tools that bad guys happen to use.”

However, Tim Miller, an MSNBC analyst and declared Trump dissident, tweeted on X about the memo suggesting the DoJ’s measure is a scheme by the president, who he says “is running a crypto scam where he can receive millions of dollars anonymously.” 

He added: “Truly no corruption scheme like this in our history, at least out of the White House.”

Crypto Markets Remain Bearish

On Trump’s first day in office, 20 January, 108 days ago, the king of cryptos, Bitcoin, saw an all-time high of $109,000, causing hype and buzz across the cryptocurrency industry. However, since that record price, BTC has dropped to as low as $75,000 just days ago and rose on Wednesday, apparently driven by the DoJ’s news.

The second largest cryptocurrency by market cap, Ethereum (ETH),, fell by nearly 22% to lows in the $1400s in the last seven days due to global economic fears across the crypto market. Still, according to CoinMarketCap (CMC), it has since recovered by over 10% to over $1,600. 

The CMC website reports that since Donald Trump took office on January 20, 2025, the crypto market’s total capitalisation had dropped by over $1.2 trillion yesterday to $2.45 trillion. It has since recovered 6.56% of its value, at $2.6 trillion.

Potentially more  volatility ahead

However, according to the crypto sector’s most prominent website, Coindesk, “The bitcoin (BTC) price is likely to become more volatile after dipping below $75,000 twice in the past week, as it might still drop driven by the economic uncertainty Trump’s global trade war is causing.

Investing.com suggests Bitcoin’s sharp decline, ”mostly wiping out a recent rebound as U.S. President Donald Trump’s steep trade tariffs took effect, sparking widespread losses in financial markets.”

The news outlet said investors fear a trade war, which would decimate their risk appetite and lead to widespread losses across traditional and crypto markets.

Whether Trump’s crypto-related campaign promises will benefit the digital asset industry or become another of his personal business ploys to further his interests remains to be seen. However, the cryptocurrency market has not responded as most of the sector’s experts had expected.