Todd Blanche's confirmation hearing exposed deep divisions over the Justice Department's crypto enforcement strategy, with Democrats accusing the acting attorney general of dismantling the agency's crypto unit and enabling President Trump's $1.4 billion in digital asset profits.
Acting Attorney General Todd Blanche faced sharp criticism from Senate Democrats on Wednesday over his decision to disband the Justice Department's crypto enforcement unit and President Donald Trump's pardon of former Binance CEO Changpeng Zhao, as Blanche's confirmation hearing exposed the administration's shifting approach to digital asset prosecution.
"Every smarmy, suspect deal in this administration has cryptocurrency behind the curtain," Senator Dick Durbin, the Illinois Democrat and ranking member of the Senate Judiciary Committee, said during the hearing. Durbin accused Blanche of "dismantling DoJ's enforcement team and shutting down ongoing criminal investigations of the crypto industry" in April 2025, when Blanche as deputy attorney general ordered the disbanding of the department's crypto enforcement unit, according to a Fortune report at the time.
The Illinois lawmaker alleged that the move enabled Trump to earn $1.4 billion from his ties to the crypto industry, including through his family's business World Liberty Financial. Durbin also accused Zhao of having "brokered a deal to channel $2 billion" into World Liberty, which he said led to the presidential pardon. Zhao, who stepped down as Binance CEO in 2023 after pleading guilty to one felony charge related to anti-money laundering failures at the exchange, received a pardon from Trump earlier this year.
Republican Senator Thom Tillis of North Carolina said he was "concerned that the Binance CEO got pardoned." Blanche responded that he would review the pardon process if confirmed as attorney general.
Blanche has signaled a sharp departure from the Biden administration's approach to crypto enforcement. Speaking at the Bitcoin 2026 conference, he said developers who write code would not face prosecution if they are not knowingly facilitating illicit activity. "If you are developing software, if you are a coder, if you are part of that process and you are not the third-party user, and you are not helping and knowing the third party is using what you developed to commit crimes, you are not going to be investigated and not going to be charged," Blanche said.
The department still has active cases against developers behind platforms allegedly used for illegal activities. Federal prosecutors are expected to retry Tornado Cash co-founder Roman Storm later this year after a jury failed to reach a verdict on two charges in 2025.
Blanche held at least $159,000 worth of digital asset-related investments before divesting them to his children and grandchildren, according to financial disclosures. He has served as acting attorney general since April, when Trump fired predecessor Pam Bondi.
The nomination now hinges on whether Blanche can secure all 11 Republican votes on the Judiciary Committee, where the party holds a narrow 52-47 Senate majority. If confirmed, Blanche's "code is not a crime" doctrine would represent the most significant shift in federal crypto enforcement since the industry's emergence, potentially reshaping the legal landscape for blockchain developers and decentralized finance protocols operating in the US.
This article is for informational purposes only and does not constitute investment advice.
