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US Senators Slam DOJ Over Crypto Crime Unit Shutdown Amid Personal Holdings Conflict

Six US senators have challenged Deputy Attorney General Todd Blanche’s determination to order the closure of the DOJ-specific unit coping with crypto enforcement in April on the time he personally possessed substantial cryptocurrency holdings.

Senators Mazie Hirono, Elizabeth Warren, Richard Durbin, Sheldon Whitehouse, Christopher Coons, and Richard Blumenthal criticized Blanche in a letter dated Jan. 28, 2026, concerning his April 2025 announcement that he was disbanding the National Cryptocurrency Enforcement Team, or NCET.

Source: Mazie Ok. Hirono

The senators mentioned the choice got here at a time when Blanche had a direct monetary curiosity in cryptocurrencies, elevating considerations about conflicts of curiosity and potential violations of federal ethics regulation.

Did Crypto Conflicts Kill DOJ Enforcement? Lawmakers Demand Answers

In 2022, beneath the administration of President Biden, the NCET was established to steer the difficult cryptocurrency crime investigations within the Justice Department.

The unit was on the heart of plenty of high-profile circumstances, together with the investigation of Binance and its founder, Changpeng “CZ” Zhao, who in 2023 admitted to breaking anti-money-laundering legal guidelines within the United States.

In April 2025, a number of months after Donald Trump was inaugurated, Blanche ordered the unit disbanded, and his marketing campaign included an insistence on backing the digital asset business.

The senators famous that Blanche disclosed crypto holdings valued between $158,000 and $470,000 in January 2025, largely in Bitcoin and Ethereum, simply days earlier than Trump’s inauguration.

On Feb. 10, he agreed to divest these belongings “as quickly as practicable.” However, the lawmakers famous that Blanche was confirmed as deputy lawyer basic on March 5 and issued the sweeping coverage memo on April 7 scaling again crypto enforcement.

They added that he didn’t start disposing of his crypto holdings till late May, with gross sales or transfers accomplished between May 31 and June 3.

The senators reported of their letter that Blanche might have breached the 18 U.S.C. 208(a) provision that typically prohibits government authorities of the manager department officers from participating in making choices that affect their very own monetary acquire.

According to them, the problem is now beneath a criticism to the Office of the Inspector General of the DOJ, and so they requested Blanche hold the paperwork and provides a complete account of how the problem was reported, responded to, and in the end cleared by the ethics officers.

Senators had earlier raised considerations over Blanche’s choices

The April 7 memo, titled “Ending Regulation by Prosecution,” marked a big shift in how the Justice Department approaches digital belongings.

Blanche argued that the DOJ will not be a monetary regulator and mentioned prior enforcement efforts amounted to “regulation by prosecution.”

The new coverage instructed the prosecutors to pursue people who straight victimize crypto traders or use digital belongings in crimes (together with terrorism, narcotics, organized crime, and human trafficking) and keep away from pursuing circumstances involving exchanges, mixers, and different boards as their customers could perpetrate crimes.

The memo additionally instructed that investigations that weren’t in keeping with the brand new priorities be shut down and NCET be formally dissolved.

Lawmakers mentioned they warned Blanche final yr that scaling again enforcement would have severe penalties. In their newest letter, they pointed to information displaying illicit cryptocurrency exercise surged in 2025, with TRM Labs estimating $158 billion in illegal transactions, up almost 145% from the earlier yr.

They mentioned the rise was pushed partially by sanctioned entities however famous that the majority classes of crypto crime rose, together with violent crime and human trafficking. Criminals stole an estimated $2.87 billion by way of almost 150 hacks throughout the yr.

The publish US Senators Slam DOJ Over Crypto Crime Unit Shutdown Amid Personal Holdings Conflict appeared first on Cryptonews.

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