- David Sacks, Trump’s crypto advisor, has divested from personal crypto holdings amid controversy over potential conflicts of interest with Trump’s strategic crypto reserve plans.
- Craft Ventures, Sacks’ firm, reportedly exited its position in Bitwise prior to Trump’s second administration, addressing concerns about indirect benefit from the government’s crypto purchases.
- Trump’s proposed strategic crypto reserve of Bitcoin, Ethereum, XRP, Cardano, and Solana has divided the crypto community, with some questioning government involvement in digital assets.
Controversy erupted this week after President Donald Trump‘s crypto and AI czar David Sacks faced allegations of potential financial gain from the administration’s newly announced strategic cryptocurrency reserve. The scrutiny intensified following Trump’s Sunday declaration that the government would hold reserves of Bitcoin, Ethereum, XRP, Cardano, and Solana.
The venture capitalist found himself at the center of the debate as critics questioned whether his prior investments in cryptocurrency assets might create a conflict of interest with his advisory role. Sacks took to X (formerly Twitter) throughout Monday to defend himself against these accusations.
“The accusation that people who are already very successful in business go into government to make more money is a lazy and stupid narrative,” Sacks wrote on the platform. “As I’ve learned, serving in government involves substantial disruption and divestiture of one’s business interests.”
Sacks affirmed he had divested from all personal crypto-related holdings before joining Trump’s administration, including his stake in Multicoin Capital, a crypto-focused investment firm. However, questions remained about whether Craft Ventures, Sacks’ venture capital firm, still maintained investments in Bitwise, a crypto index fund manager that Sacks helped finance in 2017.
The concern centered on Bitwise’s investment products, which include an ETF containing all the digital assets named in Trump’s strategic reserve announcement. This connection raised questions about whether Craft Ventures could indirectly benefit from government purchases of these cryptocurrencies.
On Tuesday, these concerns appeared to be addressed when a source close to Craft Ventures confirmed to CoinDesk that the fund had exited its Bitwise position before the start of Trump’s second term. The Craft Ventures website was subsequently updated to indicate the Bitwise investment had been terminated in January 2025.
According to the source, Craft Ventures has maintained public silence on the matter to avoid disrupting Sacks’ ongoing government clearance process. Neither Craft Ventures, Bitwise, nor Sacks have issued official statements regarding the reported exit.
The debate around Trump’s proposed crypto reserve continues to divide industry stakeholders. Some of the president’s crypto supporters argue for a Bitcoin-only reserve, while others question whether government involvement in digital asset holdings contradicts cryptocurrency’s foundational principle of decentralization.
The controversy extends to Trump himself, as the president maintains connections to World Liberty Financial, a Trump-backed crypto startup holding approximately $500 million in digital assets, including some listed in his Sunday reserve announcement.
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