The Justice Department’s move last year to shut a specialized crypto enforcement team is drawing fresh fire after six US senators pressed the deputy attorney general for answers about his personal stakes in digital assets.
The lawmakers say the timing and Deputy Attorney General Todd Blanche’s holdings raise real questions about conflicts that need clear records and a full explanation.
Senators Demand Answers
Reports say the letter, dated January 28, 2026, was sent by Senator Mazie Hirono and joined by Senators Elizabeth Warren, Richard Durbin, Sheldon Whitehouse, Chris Coons, and Richard Blumenthal.
They asked Blanche to provide documents and explain why the National Cryptocurrency Enforcement Team (NCET) was disbanded in April 2025 and whether his own finances played any role in that decision. The lawmakers pointed to federal conflict rules and asked for the timeline and approvals behind the memo.
The memo signed by Deputy Attorney General Todd Blanche. Source: DOJ
He agreed to divest, and some sales or transfers happened weeks to months after the memo. Critics say that sequence looks bad and could run afoul of conflict rules; supporters say the matters were cleared by ethics officials.
People On Both Sides Are Talking
Proponents of the policy change argued it would avoid “regulation by prosecution” and let regulators handle oversight instead of criminal cases.
Industry groups welcomed the move as a way to reduce legal uncertainty for exchanges and developers.
Opponents, including the senators, say scaling back a focused enforcement unit risks leaving gaps that bad actors can exploit, especially as illicit activity in crypto has shown sharp swings in recent years.
What Comes Next
Lawmakers are now pushing for documents and sworn answers. They want to see when Blanche learned of the holdings, how fast divestment happened, and who inside DOJ reviewed and approved the memo.
The senators pointed to federal law that bars an official from participating in a matter when they have a financial interest, and they requested a timeline and supporting records to judge whether that law was respected.
Featured image from Getty Images, chart from TradingView
