Recently, the Deputy Attorney General for the DOJ released a memo that outlined a new policy direction for the DOJ regarding the enforcement of laws related to digital assets. The memo emphasized ending the previous administration’s approach of “regulation by prosecution,” which it described as “ill conceived and poorly executed.” Instead, the DOJ will focus on prosecuting individuals who harm digital asset investors or used digital assets for criminal activities such as terrorism, narcotics trafficking, organized crime, and human trafficking. The Deputy Attorney General posited this policy was aligned with Executive Order 14178 (covered by InfoBytes here), which called for protecting the use of blockchain networks and promoting U.S. leadership in digital assets. The memo rescinded with immediate effect any previous policies or directives inconsistent with the approach it outlined.
The memo also raised concerns around investor losses that have resulted from fraud and theft in connection with collapses of digital asset companies. Additionally, the memo set forth an intent to shift resources away from cryptocurrency enforcement, disbanding the National Cryptocurrency Enforcement Team and redirecting efforts towards other priorities, such as immigration and procurement frauds. Finally, the memo stated the DOJ will participate in President Trump’s Working Group on Digital Asset Markets to recommend regulatory and legislative changes that affect the digital asset sector.
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