Crypto Enters New Era of Deregulation: Positive Shift for Growth, But Not Without Risks AllinCrypto April 9, 2025
The US Justice Department has disbanded its National Cryptocurrency Enforcement Team and requested that prosecutors focus on cartels and drug smuggling over crypto companies.
According to Deputy Attorney General Todd Blanche, “The Department of Justice is not a digital assets regulator.” and spoke of Biden’s “reckless” strategy of regulation by prosecuting crypto companies.
With the department being disbanded, crypto in the US is effectively becoming more deregulated after years of tough, strict actions taken against crypto firms. For the future of crypto, this is great news, but it may come with risks.
US Justice Department deregulates crypto further by disbanding enforcement team
The US Justice Department has closed its National Cryptocurrency Enforcement Team, deciding that more resources should be placed on more pressing crimes instead of targeting registered companies, according to Deputy Attorney General Todd Blanche.
Balance further stated that prosecutors will instead focus on “Individuals who victimize digital asset investors, or those who use digital assets in furtherance of criminal offenses such as terrorism, narcotics and human trafficking, organized crime, hacking, and cartel and gang financing.”
President Trump’s pro-crypto administration has gradually become more openly pro-crypto since January 2025, enacting administrative orders for crypto strategic reserves and pushing stablecoin bills.
Deregulation of the cryptocurrency industry in the US will open doors wide for the approval of altcoin ETFs, clear paths for banks to adopt crypto, and aid growth for the industry.
The goal of deregulation is also on the mind of SEC Crypto Task Force head Hester Peirce who aims to foster an environment in the US where digital asset companies and projects are able to experiment and innovate without strict regulations holding them back.
During Gary Gensler’s SEC chairmanship, crypto leaders such a Ripple and exchanges were hit with investigations and sued for activities deemed unfavorable.
Many firms threatened to leave the US and enter other markets internationally which had fewer restrictions on their operations.
With Trump in office, those companies have decided to stay, with Gemini exchange founders, sued and investigated by the SEC in a lengthy process, demanding compensation for the troubles that the SEC put them through.
With the SEC wrapping up their appeal against Ripple, a new era of crypto in the US is here with deregulation and freedom of experimentation at the forefront. Those same rules may apply to decentralized protocols where experimentation is key.
Should DeFi investors be concerned about deregulation?
All cryptocurrency traders are aware of crypto crimes such as rug pulls, fake projects, and crypto scams. For the SEC, deregulation will focus on fostering growth and not ignoring brazen criminal activity.
In response, Hester Peirce of the Crypto Task Force mentioned that some events that happen in DeFi may be out of the SEC’s range when it comes to enforcement.
While controversial platforms like Pumpfun on Solana are openly operating in the US, in the UK such platforms are outright banned with the UK’s FCA warning traders to stay well clear of such entities.
Once DeFi resurges from the current market slump, we may see if the SEC’s hands-off approach to DeFi could bite back.
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