Democrats Blast DOJ's Crypto Crackdown U-Turn: "A Free Pass for Money Launderers!"

Senators Warren and Six Others Demand Reversal of "Nonsensical" Decision

Hold onto your hats, crypto fans! Democratic lawmakers are absolutely fuming over the Department of Justice's shocking move to dismantle their National Cryptocurrency Enforcement Team. They're calling it "nonsensical" and a total gift to the bad guys out there.

Led by the fiery Senator Elizabeth Warren, seven Senate Democrats fired off a no-holds-barred letter to Deputy Attorney General Todd Blanche on April 10. They're demanding the DOJ reverse this dangerous and flat-out misguided shift in how they're tackling crypto enforcement.

This all kicked off after Blanche dropped a bombshell memo on April 7, officially pulling the plug on the DOJ's National Cryptocurrency Enforcement Team. Can you believe it?

Blanche tried to defend his wild decision, claiming the DOJ isn't some kind of digital assets regulator. He even threw shade at the previous administration, calling their approach a "reckless strategy of regulation by prosecution." Ouch!

But that's not all. Blanche is also telling DOJ staff to back off from cases involving crypto exchanges, mixers, and offline wallets. Instead, they're supposed to go after individuals directly victimizing digital asset investors. Talk about a major pivot!

The lawmakers are absolutely livid, arguing that this pullback is like rolling out the red carpet for sanctions evasion, drug trafficking, scams, and even child exploitation. They're warning that much of this shady business is fueled by crypto mixing services designed to hide the origins of dirty money.

Let's not forget, the National Cryptocurrency Enforcement Team was tackling some of the biggest crypto cases in the U.S., like the money laundering case against the notorious Tornado Cash mixing platform.

The Senators are calling Blanche's memo a straight-up "free pass to cryptocurrency money launderers." They're not holding back!

And get this: the DOJ is also throwing in the towel on prosecuting violations of the Bank Secrecy Act. The lawmakers are warning this move is a total abdication of the DOJ's responsibility to enforce federal criminal law in the digital asset world.

They're arguing that this is tearing down existing anti-money laundering protections and creating a "systemic vulnerability" that drug traffickers, terrorists, and fraudsters are going to exploit on a massive scale. It's like leaving the door wide open for these criminals!

The letter goes on to highlight just how successful the NCET has been since it was formed back in 2021. They've racked up multiple high-profile convictions, seized millions in assets, and supported state and local agencies left and right. Dismantling the team is a huge blow to law enforcement's ability to handle these complex crypto cases.

But wait, there's more! The lawmakers are also throwing some serious shade, questioning whether President Donald Trump's own crypto ventures might have influenced the DOJ's decision. Talk about a political angle!

Trump family-backed projects have been under fire lately, especially World Liberty Financial. They launched their own cryptocurrency last year and are planning to introduce a stablecoin. But people are raising eyebrows over the Trump family's tight control and potential conflicts of interest.

"Why would you dismantle a team that's such a crucial player in fighting cryptocurrency-based crime? Your decisions are raising some serious red flags that President Trump's interest in selling his cryptocurrency might be the reason for easing up on law enforcement scrutiny," the lawmakers wrote. They're not pulling any punches!

"We urge you to reconsider these decisions," the Senators demanded, requesting a staff-level briefing by May 1 to explain the rationale behind the DOJ's move and its potential impact on crypto-related criminal enforcement. They want answers, and they want them now!

And let's not forget, Senator Warren has been on a warpath against cryptocurrencies lately. She's been going after several Republicans over their crypto ties, including Trump's AI and crypto czar David Sacks and Commerce Secretary nominee Howard Lutnick. This woman means business!