Democrats investigate Sacks' impact on crypto and AI as ethical debate over term limits intensifies

Elizabeth Warren, joined by several Democratic colleagues, has initiated a probe into possible ethical breaches by David Sacks, who serves as President Donald Trump’s Special Advisor for AI and Crypto. The investigation centers on allegations that Sacks has surpassed the 130-day service cap set for Special Government Employees (SGEs). Senators Richard Blumenthal, Bernie Sanders, and Representatives Betty McCollum and Rashida Tlaib contend that Sacks’ ongoing role in shaping AI and crypto regulations, while retaining substantial financial interests in these sectors, presents significant conflicts of interest. Sacks, a venture capitalist and the founder of Craft Ventures, received ethics waivers from the Trump administration, allowing him to keep his investments in AI and crypto firms, which would normally be restricted for SGEs.

The 130-day SGE limit is a crucial aspect of federal ethics guidelines, intended to prevent private sector professionals from holding extended government positions that might lead to conflicts. Sacks, who was appointed in December 2024 and began his duties on January 20, 2025, is under scrutiny regarding whether he has exceeded this threshold. According to the lawmakers, if Sacks worked every weekday since the inauguration, he would have reached the 130-day mark by late July 2025. Sacks’ office asserts that he spaces out his SGE workdays to comply with the rules, but lawmakers highlight the lack of clear records tracking his schedule. The inquiry also points to Sacks’ ongoing position as General Partner at Craft Ventures, which invests in numerous AI and crypto startups, potentially giving him the ability to shape policies that could benefit his own investments.

The letter from the lawmakers stresses the wider significance of Sacks’ possible violation, especially as the Trump administration advances new crypto laws and regulatory measures. They cite Sacks’ recent support for a U.S. Strategic

Reserve, a proposal that could offer considerable advantages to his associated businesses. The lawmakers’ investigation is linked to their previously proposed SGE Ethics Enforcement & Reform (SEER) Act, which would require the Office of Government Ethics (OGE) to approve SGE waivers, impose stricter recusal requirements for Sacks, and make his financial disclosures public. The legislation also aims to limit Sacks’ interactions with agencies that regulate Craft Ventures, further highlighting concerns about his sway over policy decisions.

Sacks has responded by stating that he sold $200 million worth of crypto assets, including Bitcoin,

, and , before taking on his government role to avoid any conflicts. Nevertheless, lawmakers point out that Sacks remains heavily involved in AI and crypto through Craft Ventures, which still holds interests in companies that align with his policy initiatives. A spokesperson for Sacks reaffirmed his intention to follow SGE regulations, but critics argue that the repeated granting of ethics waivers by the Trump administration undermines the purpose of the SGE role. The investigation also examines Sacks’ previous involvement in organizing a Trump fundraiser that brought in $12 million, intensifying claims of partisan favoritism in his advisory position.

This investigation is part of a broader scrutiny of the Trump administration’s approach to ethics in senior appointments. Sacks’ situation highlights the administration’s pattern of appointing private sector leaders with significant stakes in the industries they help regulate. The lawmakers’ emphasis on the 130-day rule reflects ongoing concerns about the balance between Sacks’ temporary SGE status and his extended influence over policy, with the risk that regulatory choices could directly benefit his financial interests. The outcome of this inquiry could set new standards for enforcing SGE ethics in future administrations.

Source: [1] U.S. Senator Elizabeth Warren | Warren, Stansbury, Member... [2] Elizabeth Warren Wants To Probe Trump's Crypto Czar And How … [3] Democrats launch ethics investigation into AI and … [4] Sen. Warren presses Trump AI czar David Sacks on overstaying … [5] Crypto Tsar David Sacks Claims He Has Not Exceeded … [6] David Sacks sold $200 million in crypto holdings before taking [7] David Sacks Clarifies Crypto Sale, Says He Divested—Not Dumped [8] David Sacks Sold His Crypto Holdings Before Trump …