U.S. Senators are pushing Deputy Attorney General Todd Blanche to reverse its decision of closing the crypto enforcement unit in the Department of Justice’s (DOJ) decision to change the mind.
There have been concerns among the senators after it was reported that Blanche had large sums of cryptocurrency at the time of making the decision, which might bring conflicts of interest.
Senators attack the decision of Blanch
U.S. Senators strongly condemned the decisions by the DOJ to eliminate the National Cryptocurrency Enforcement Team in a letter to Blanche dated January 28, 2026.
According to the senators, this move was unsound and would allow the criminals to evade punishment and carry on with their illegal activities.
They cited the illicit crypto activity that has risen by 162% in 2025, much of which is primarily due to the participation of licensed enterprises and organized crime.
The senators were interested in the when aspect of the decision taken by Blanche, and it was known that he owned considerable holdings in Bitcoin and Ethereum, with a range of between $158,000 and 470,000 of it.
Blanche agreed to sell these assets by February 2025, although the move to reduce crypto enforcement coincided with his own change of heart.
This has given rise to more suspicions regarding his motives.
Cryptocurrency fraud on the increase
The issue of illicit crypto activity has been exacerbated by a report by TRM Labs published on January 28, indicating that the amount of illicit crypto transactions is at an all-time high of 158 billion in 2025.
This is a growth of 145% compared to the last year.
Although the percentage of total crypto volume that is related to crime has declined slightly, the raw numbers show that illicit use has increased substantially.
The report notes that China has emerged as a significant force in the field, with crypto-related illegal business increasing by a factor of five, with escrow service companies and hidden banking systems in Chinese languages skyrocketing their businesses by over $103 billion in 2025 (as compared to 123 million in 2020).
The Senate has reiterated the importance of the crypto enforcement team served by the DOJ in addressing crimes such as child sexual exploitation, drug trafficking, and money laundering.
The move to carry out an abolishment of this unit, they reasoned, simplifies the abuse of the crypto market by criminals.
Blanche undergoes legal inspection
Senators noted that the decision to decrease the enforcement of crypto made by Blanche breaches the regulatory provision of 18 U.S.C. 208(a), which forbids any executive branch worker from engaging in the decision-making process when he/she has a monetary attachment to the results of such a decision.
The senators have actually complained to the Office of the Inspector General at the DOJ, urging the office to investigate the actions of Blanche.
According to them, the move to dissolve the unit and his personal financial involvement in cryptocurrency deserve serious legal investigations.
The future of crypto enforcement is still unclear as lawmakers keep examining the move taken by the DOJ.
As the issues regarding the illicit presence in the crypto space escalate, the question of the role of the DOJ in addressing financial crimes is to be further discussed.
The request of the Senate to reverse the decision indicates the extended worries regarding the increase in the power of criminal groups in the digital currency market.
