David Sacks, President Trump's crypto and AI czar, faced scrutiny after Trump's announcement of a U.S. strategic crypto reserve featuring cryptocurrencies linked to companies in which Sacks had investments. Critics alleged Sacks stood to benefit financially from the policy.
Sacks responded by denying any conflict of interest. He stated that he had divested from all personal crypto-related holdings before joining the administration, including his stake in Multicoin Capital. The question remained about whether his venture capital firm, Craft Ventures, had retained its investment in Bitwise, a crypto index fund manager linked to assets in the reserve plan.
A source close to Craft Ventures later confirmed that the firm exited its Bitwise position prior to the start of the administration, with their website updated to reflect the exit in January 2025. Craft Ventures, Bitwise, and Sacks have not publicly commented on the exit, citing ongoing government clearance processes.
Sacks dismissed the controversy on social media, calling the idea that successful businesspeople join government to make more money a "lazy and stupid narrative," emphasizing that government service involves significant disruption and divestiture of business interests.
Despite Sacks' reassurances, conflict of interest concerns remain in the crypto community, especially given Trump's own crypto holdings linked to the reserve. On top of this, White House memos revealed that Sacks and Craft Ventures divested over $200 million in crypto-related investments, including Bitcoin, Ethereum, Solana, Coinbase, Robinhood, and several crypto-focused venture funds, before he took office. A waiver was granted acknowledging the extensive divestment and confirming that residual holdings were minimal.
This divestment move was aimed at preventing conflicts of interest as Sacks helped guide crypto policy, including the creation of a legal framework for the crypto industry and overseeing the new Strategic Bitcoin Reserve funded through confiscated assets, not taxpayer money.
