Todd Blanche, the man who as deputy attorney general drafted the Justice Department's memo scaling back federal crypto enforcement, is now running the DOJ as interim attorney general. President Trump made the appointment after Pam Bondi's departure, and the crypto industry is paying close attention to what happens next.
Blanche is not a random pick. Before joining the Trump administration, he was Trump's personal defense attorney. His rise from deputy AG to acting AG at this particular moment - with crypto regulation still evolving and major cases still in play - makes this appointment more than just a routine reshuffle.
The Memo That Changed Things
Earlier in his tenure as deputy AG, Blanche sent a memo to federal prosecutors that directed them to back away from cases centered on regulatory disagreements in the crypto space. The basic message: don't waste resources on cases where a company is disputing how a law applies to it. Focus on actual fraud, actual theft, actual harm. Leave the regulatory gray-zone fights to the agencies whose job that is.
The practical effects showed up quickly. The case against Tornado Cash developer Roman Storm saw certain charges dropped, then later reinstated - a signal of how messy the transition has been. More broadly, crypto companies accused of securities violations found a DOJ less eager to pile on while SEC cases were already in motion.
For the industry, this shift was welcome. For oversight advocates, it was alarming. The debate over where the line sits between "regulatory dispute" and "actual crime" in the crypto space is not a clean one, and Blanche's memo pushed that line in a direction favorable to the industry.
The Ethics Questions Aren't Going Away
What complicates Blanche's new role is his personal financial position. According to a ProPublica investigation, Blanche held between $159,000 and $485,000 in digital assets around the time he sent that enforcement memo. His holdings reportedly included Bitcoin, Ethereum, Solana, several smaller altcoins, and equity in Coinbase - the same Coinbase that just received a major federal bank charter.
Blanche has said he transferred these assets to family members, but questions remain about the timing of that transfer relative to when he was making decisions that affected the crypto industry. Federal ethics rules require officials to recuse themselves from matters that affect their financial interests, or to divest before taking those decisions. Whether Blanche's alleged actions satisfied those requirements is still being scrutinized by oversight bodies.
The optics are genuinely awkward. The man now running the Justice Department wrote a policy that benefited an industry he was personally invested in, and is now in an even more powerful position to shape how that policy plays out.
What I'm Watching..
The short-term read is probably positive. A DOJ led by someone with a demonstrated preference for pulling back from aggressive crypto enforcement means less immediate threat of headline-driven enforcement actions. Institutional investors who have been sitting on the sidelines partly because of legal uncertainty may see the environment as incrementally safer.
The longer-term read is more complicated. An enforcement environment that leans heavily on the industry to self-regulate is only as good as the industry's willingness to self-regulate. It also creates policy uncertainty - Blanche's position is "interim," meaning a Senate-confirmed replacement eventually takes over, and that person may bring a completely different philosophy.
The US government's relationship with crypto is clearly in a period of active reconfiguration. Blanche's appointment is one more data point in that process - meaningful, consequential, and still far from settled.
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Author: Jules Laurent
Euro Newsroom | Breaking Crypto News
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