The United States puts an end to this controversial anti-cryptocurrency group.

The U.S. Department of Justice has disbanded its National Cryptocurrency Enforcement Task Force, marking a significant shift in the regulation of these digital assets. 

The United States Department of Justice has made the decision to disband its National Cryptocurrency Enforcement Team, known as NCET, for its acronym in English. This specialized unit, created in 2021 during the Joe Biden administration, was responsible for investigating and prosecuting cryptocurrency-related crimes. 

However, the DOJ formalized the dissolution of this group through an internal memorandum effective immediately this week, ordering a strategic reorientation in how the federal government approaches the cryptoasset market, now considered one of the key sectors for U.S. innovation and global leadership. 

The NCET's creation was primarily aimed at stopping the illicit use of cryptocurrencies, protecting investors, and ensuring the integrity of the financial system. However, after an internal review, The DOJ determined that this group was more oriented toward implementing “a reckless strategy of regulation by persecution.” which was in line with the interests of the previous administration. Based on this, the Department decided to dissolve the group, stating that it is not a cryptocurrency regulatory agency.

Now, regarding these digital assets, the Department of Justice said it will focus solely on prosecuting individuals who use cryptocurrencies and digital assets to victimize or defraud users, rather than prosecuting or "going after" protocols or companies, like Tornado Cash, for the misuse of their products and services. 

Why was the National Cryptocurrency Control Team disbanded?

The dissolution of the NCET marks the end of an era of reckless federal oversight of the cryptocurrency industry, aligning with current US President Donald Trump's goals of global market dominance. 

As mentioned, this team had been involved in enforcement actions targeting platforms such as Tornado Cash, the Mango Markets protocol hack by Avraham Eisenberg, and money laundering by North Korean actors. However, the Trump administration deemed the group to prioritize actions against cryptocurrency platforms, such as exchanges, mixers, and wallets. instead of focusing on individuals who harm investors, according to him memo issued by the DOJ on Monday. 

The closure of the NCET is therefore part of Trump's stated goal of turning the United States into the "global Bitcoin superpower," promoting a less adversarial environment for the industry. The current administration is seeking to distance itself from what it describes as a overly punitive approach, oriented to criminalizing technological tools instead of prosecuting specific crimesHowever, critics argue that this measure could weaken authorities' ability to combat illicit activity in the crypto ecosystem.

Despite this, the DOJ's decision reflects a shift in strategy toward explicitly pro-crypto policies, which also include the creation of a Bitcoin strategic reserve and regulatory easing through agencies like the SEC and CFTC.

The political context: The Trump administration sees potential in cryptocurrencies

The dissolution of the NCET is part of a broader recalibration across federal agencies as the Trump administration seeks to create a more favorable environment for crypto innovation, prompting regulators such as the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) to review their cryptocurrency policies to align with the new administration's efforts.

The Trump administration has publicly expressed its support for cryptocurrencies on several occasions, raising expectations of more favorable regulation for the sector. This stance contrasts sharply with that of previous administrations, which have shown greater caution and even skepticism toward digital assets. However, their vision is clear: to make the United States the world leader in cryptocurrencies. This implies a regulatory approach that encourages innovation and investment in this emerging sector.

In conclusion, the dissolution of the National Cryptocurrency Enforcement Team (NCET) marks a turning point in the country's crypto regulation, prioritizing the creation of a more favorable environment for technological development and innovation. 

Investing in cryptoassets is not fully regulated, may not be suitable for retail investors due to high volatility and there is a risk of losing all invested amounts.