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Ruholamin Haqshanas
Author
Ruholamin Haqshanas
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Sen. Elizabeth Warren (D-Mass.) raised ethical concerns regarding the administration’s approach to cryptocurrency regulation as the White House holds its first Digital Assets Summit.
In a letter addressed to David Sacks, the administration’s crypto and AI czar, Warren questioned potential conflicts of interest and the ethical implications of the government’s involvement in the blockchain industry.
In the letter, Warren voiced concern regarding transparency and accountability in digital asset policymaking.
Ethical Concerns and Conflicts of Interest
Warren argues that as the federal government deepens its engagement with the blockchain sector, it inadvertently drives up valuations for existing cryptocurrency holders, raising concerns about conflicts of interest among officials shaping these policies.
Her letter to Sacks demands clarity on whether he and his colleagues stand to benefit from the decisions they make.
She also criticizes moves by President Donald Trump’s administration, claiming they cast doubt on the ethical integrity of its crypto-related decision-making processes.
Warren insists that Americans deserve leaders who prioritize the public interest over personal financial gain.
As a special government employee, Sacks benefits from certain exemptions under ethics regulations, including the ability to keep financial disclosure reports confidential.
This has fueled concerns over whether key policymakers are sufficiently transparent about their financial ties to the cryptocurrency industry.
Sacks has faced scrutiny since Trump hinted at a potential U.S. crypto reserve last weekend.
In response, he stated that he had liquidated all his cryptocurrency holdings before joining the administration.
However, Warren highlights that indirect exposure remains possible.
Before his government role, Sacks was a partner at Craft Ventures, an investment firm that backed several crypto-related companies, including Fold, Lightning Labs, and Bitwise.
Notably, Bitwise operates investment indices for cryptocurrencies, with its Bitwise 10 Index heavily weighted toward Bitcoin (BTC), Ether (ETH), Solana (SOL), XRP (XRP), and Cardano (ADA)—the same five assets Trump identified for a proposed crypto strategic reserve.
Sacks has since stated that he divested from the Bitwise index, and Craft Ventures confirmed it had exited its stake in the company.
Trump’s announcement of a potential crypto reserve triggered a $300 billion surge in global crypto markets, with the five identified assets experiencing significant gains.
However, on Thursday, the White House clarified that a newly signed executive order establishing a “Strategic Bitcoin Reserve” and a U.S. “Digital Asset Stockpile” would not involve direct government purchases but would instead rely on assets seized from criminal activities.
Following this clarification, the same assets saw sharp price declines.
Warren Presses for Transparency on Trump’s Crypto Reserve Picks
Warren’s letter seeks transparency on how Trump’s team selected the assets for the proposed reserve and whether any officials involved had financial conflicts of interest.
She also inquires whether any insiders made relevant trades before the announcement.
Additionally, Warren has requested that Sacks publicly disclose his financial ethics report and provide evidence that he has fully divested from the named cryptocurrencies.
