Judge Will Ban Crypto Units and Refuse Services Like Tornado Cash

The U.S. Department of Justice has disbanded its crypto-dedicated police staff and will no more pursue criminal cases in some important crypto-related areas as part of a significant shakeup of crypto regulation in the country, according to a letter released Monday night. &nbsp,

The letter, which Deputy Attorney General Todd Blanche sent to company employees last night, states that the DOJ’s National Cryptocurrency Enforcement Team (NCET ) will be disbanded quickly. &nbsp,

In addition, the DOJ will no longer bring charges against bitcoin markets, crypto combining services, or cool wallet owners for “acts of their end customers or inadvertent violations of regulations,” unless they involve crimes like embezzlement, scams, floor pulls, and hacks. &nbsp,

Amanda Tuminelli, senior chairman of DeFi Education Fund, a blockchain lobbying organization, posted a copy of the letter to X on Tuesday night. A knowledgeable person with knowledge of the situation confirmed its existence. The document’s details were second revealed by .

In a significant change in company policy, the DOJ stated in the memo that prosecutors will just follow the enemy group itself and” did not take actions against the platforms that these enterprises use to perform their unlawful activities.” This is a major change in agency policy.

Since being well-known among privacy advocates and also with criminal organizations looking to launder digital assets, crypto mixing services like Tornado Cash, which allow users to keep their crypto transactions private, have attracted government scrutiny for years.

Roman Storm, the site’s creator, was detained and charged with criminal money laundering in 2023, whose legal defense argued that Tornado Cash is a permissionless service that doesn’t purposefully aid criminal actors. &nbsp,

However, the case’s presiding judge in the fall rejected Storm’s free speech defense, and the case is scheduled to go to trial this summer. &nbsp,

Now, that could change. The U.S. Treasury Department lifted sanctions against Tornado Cash last month in accordance with a court order, and the Deputy Attorney General of Tornado Cash’s DOJ memo last night specifically stated that all disputes that are incompatible with the agency’s new crypto policies should be dismissed. &nbsp,

reached out to the DOJ and Roman Storm’s attorneys regarding any upcoming developments in the case, but it was not right to respond. &nbsp,

The DOJ claims that its hard pivot on crypto coincides with President Donald Trump’s executive order, which mandated that important federal agencies promote and protect access to public blockchains without fear of “persecution” in late January.

In a reference to the policies of former president Joe Biden and his administration, Deputy Attorney General Blanche wrote to DOJ staff last night that” the prior Administration used the Justice Department to pursue a reckless strategy of regulation by prosecution that was poorly conceived and poorly executed. &nbsp,

Therefore, the top prosecutor in America will no longer pursue what it thinks are” criminal matters based on regulatory violations resulting from diffuse decisions made at lower levels of digital asset companies.”