The US Department of Justice (DOJ) has signaled a major shift in its approach to law enforcement in the crypto world.
Authorities now view digital assets not just as mere "crypto fraud," but as a key tool in modern industrial-scale fraud operations.
DOJ Transforms Crypto Assets into Fraud Infrastructure as AI Turns Scams into Industrial Operations
In the 2025 Year in Review report, the DOJ highlighted three high-profile cases that demonstrate how crypto has already been integrated into traditional crime, among others:
Medicare Fraud
Multi-million US$ investment schemes, and
Asset laundering.
According to the DOJ, prosecutors charged 265 defendants in 2025 with total losses exceeding US$16 billion. This amount is more than double that of the previous year.
The DOJ Fraud Division operates through specialized units, including the Health Care Fraud Unit, which seizes cryptocurrency assets along with cash, luxury vehicles, and other assets.
Medicare Fraud: Seniors Targeted in US$1 Billion Graft Fraud, Cryptocurrency Seized
One of the most striking cases involves Tyler Kontos, Joel “Max” Kupetz, and Jorge Kinds, who were indicted in a US$1 billion amniotic wound allograft fraud scheme.
This modus operandi targets elderly patients and patients with serious illnesses with unnecessary medical procedures, resulting in fraudulent Medicare payments exceeding US$600 million.
Authorities later managed to seize over US$7.2 million in various assets, including cryptocurrency.
CEO of Wolf Capital Sentenced in US$9.4 Million Cryptocurrency Investment Fraud Case
In another case, Travis Ford, former CEO of Wolf Capital, was sentenced to five years in prison for a US$9.4 million cryptocurrency investment fraud that promised returns of 547% per year to around 2,800 investors.
These various cases illustrate a broader strategy by the DOJ: cryptocurrencies are increasingly treated like traditional illegal assets such as cash, cars, or luxury goods, rather than merely speculative new assets.
Enforcement is now no longer focused on price manipulation or hype among retail, but on asset recovery and dismantling criminal infrastructure.
This aligns with the DOJ's recent move to charge Venezuelan nationals with US$1 billion in cryptocurrency laundering that spans the U.S. and high-risk jurisdictions.
AI Transforms Cryptocurrency Schemes into High-Speed Criminal Networks
The industrialization of this fraud aligns with broader U.S. policy priorities. The DOJ's "America First" enforcement stance also aligns with the newly introduced bipartisan SAFE Crypto Act, which will establish a federal task force within 180 days to coordinate cryptocurrency fraud eradication efforts.
"To form a task force to identify and prevent cryptocurrency fraud, as well as for other purposes," reads one of the texts in the proposed legislation.
On the other hand, Manhattan District Attorney Alvin Bragg urged the state to criminalize unlicensed cryptocurrency operations. He warned that a US$51 billion criminal economy is developing in regulatory gray areas.
The DOJ and other regulators will likely focus on AI-laden schemes, ranging from synthetic tokenization investments to fraud with AI-based trading narratives.
The direction of cryptocurrency regulation is now increasingly influenced by its role as financial system infrastructure, rather than just due to market volatility. This brings digital assets closer to compliance, oversight, and law enforcement standards that are already entrenched in the TradFi world.
As the DOJ views cryptocurrencies as a key infrastructure of modern fraud, regulatory and law enforcement attention will increasingly target the speed, scale, and sophistication of cryptocurrency-supported crime operations.