David Sacks Quietly Divested From Crypto Company at Center of Conflict of Interest Controversy

David Sacks, who currently serves as President Donald Trump’s crypto and artificial intelligence czar, has recently faced significant scrutiny regarding potential conflicts of interest tied to Trump’s announcement of a U.S. strategic crypto reserve. This initiative, revealed by Trump, proposes that the government maintains a reserve of various digital assets, including notable cryptocurrencies such as Bitcoin (BTC), Ethereum (ETH), XRP, Cardano (ADA), and Solana (SOL). Critics have raised alarms, suggesting that members of the administration with financial ties to these cryptocurrencies could unduly benefit from the government’s foray into crypto asset management.

In the eye of the storm, Sacks, a venture capitalist with a history of investments in the crypto space, fervently denied claims of any financial motivation behind the initiative. Over the past weekend, Sacks took to X (formerly Twitter) to assert that he had completely divested from his personal crypto holdings, including a stake in Multicoin Capital, a prominent crypto investment firm, prior to assuming his role in the administration.

Despite these assertions, questions persisted regarding the status of Craft Ventures, the venture capital firm founded by Sacks. Specifically, there were uncertainties around whether Craft Ventures had maintained its investment in Bitwise, a crypto index fund manager that Sacks supported back in 2017. This concern was heightened by the fact that Bitwise offers investment products that include an ETF encompassing all cryptocurrencies outlined in Trump’s reserve plan, thereby implying potential benefits from government acquisitions.

On March 3, a source close to Craft Ventures disclosed to CoinDesk that the firm had exited its position in Bitwise prior to the commencement of Trump’s second administration. This development was backed by an update on the Craft Ventures website, confirming the exit from Bitwise investments in January 2025.

As of now, neither Craft Ventures, Bitwise, nor Sacks have made any public comments regarding this apparent exit. The lack of commentary is attributed to a desire not to interfere with Sacks’ ongoing government clearance process.

In a bid to counter the accusations, Sacks labeled the surrounding narrative as “lazy and stupid.” In a tweet, he expressed, “The accusation that people who are already very successful in business go into government to make more money is a lazy and stupid narrative. As I’ve learned, serving in government involves substantial disruption and divestiture of one’s business interests.”

Debate continues to swirl within the crypto community regarding Trump’s proposed reserve. Some supporters advocate for a Bitcoin-only reserve, while others contend that the government’s involvement in digital assets contradicts the core decentralized principles of the crypto industry. Additionally, questions concerning conflicts of interest surrounding Trump himself persist. The president’s involvement with World Liberty Financial, a crypto startup that reportedly holds around $500 million in cryptocurrency assets—including those mentioned in his reserve announcement—adds another layer of complexity to the situation.

This controversy highlights the intricate relationship between government, business interests, and the burgeoning world of cryptocurrencies, an intersection fraught with both opportunity and ethical dilemmas.