Justice Department advises crypto lawyers not to tip off clients about investigations

Quick Take

  • The Department of Justice looks to stop lawyers in crypto from tipping off clients about investigations. 

The Department of Justice doesn’t want lawyers tipping off their clients about investigations, a representative cautioned.

“We recommend that the private sector, when we are dealing with DeFi or really digital assets as a whole, to be cognizant, if the government sends you legal process when it comes to a subpoena or search warrant or of that nature to your customers, not to notify your customers because if the customer knows they’re being investigated — we call it an anti tip-off provision — perhaps they will move their assets or they will run,” said Sanjeev Bhasker, digital currency counsel with the DOJ.

Bhasker was speaking at an event held by the Blockchain Association in Washington, D.C. His comments referred to the DOJ’s responses to President Biden’s executive order on cryptocurrencies.

Bhasker said the recommendations ask, "what is DeFi, and is something truly decentralized. And if someone is labeling themselves as decentralized in nature, is that true? Are there centralized attributes?”


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That skepticism towards self-labeled “decentralized” entities extends across U.S. authorities, and Securities and Exchange Commission Chair Gary Gensler has noted it regularly.

The Commodity Futures Trading Commission’s ongoing case against Ooki DAO is similarly a challenge to the organization’s labeling as decentralized and autonomous.

© 2023 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

About Author

Kollen Post is a senior reporter at The Block, covering all things policy and geopolitics from Washington, DC. That includes legislation and regulation, securities law and money laundering, cyber warfare, corruption, CBDCs, and blockchain’s role in the developing world. He speaks Russian and Arabic. You can send him leads at [email protected].


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