Venture capitalist David Sacks—who serves as President Donald Trump’s AI and cryptocurrency czar—cautioned about potentially devastating outcomes should the U.S.-Israel conflict with Iran persist.
During a Friday episode of the All-In podcast, he stated, “We should likely find an exit strategy,” pointing out that Iran’s military has been severely damaged.
“Now is a good moment to claim victory and withdraw—and that’s clearly what the markets are hoping for,” Sacks further commented.
However, he noted that a group within the Republican Party and other circles is pushing to escalate the conflict, deploy ground forces, and pursue regime change in Iran.
In reality, Trump initially mentioned regime change when the war began two weeks ago but has since toned down that rhetoric. At the same time, he directed the U.S. military to strike Iran’s primary oil export hub, Kharg Island, and deploy 2,500 Marines from Asia to the Middle East.
The White House did not provide an immediate response to a request for comment.
Sacks raised concerns about a cycle of retaliatory escalation in the region that could result in both sides attacking each other’s oil and gas facilities.
At that stage, reopening the Strait of Hormuz— which Iran has essentially shut down—to restore energy supplies would be irrelevant, as restarting oil and gas production would not be feasible, he explained.
Sacks warned that an even more dire situation could occur if desalination plants— which supply most of the region’s fresh water and have already been attacked—are destroyed.
He elaborated, “If this kind of destruction keeps happening, you could actually make the Gulf nearly unlivable. Think about it—100 million people wouldn’t have enough water, and humans can’t survive long without it. That would be an absolutely catastrophic situation: we’d be ruining the Gulf states both economically and from a humanitarian standpoint.”
Although Israel is less susceptible, Sacks noted that the country has suffered significant damage from Iranian attacks, adding that “Israel could be completely destroyed or have huge swathes of its territory ruined” if the war continues for weeks or months.
If Israel finds itself under such a grave threat, it increases the risk of the country escalating the conflict further and possibly considering the use of nuclear weapons, he stated.
Sacks went on, “There are so many scenarios here—so many truly terrifying ones about where escalation could take us. Even though the U.S. is far more powerful than Iran, they basically hold a dead man’s switch over the Gulf states’ economic future, and possibly even beyond that.”
Considering the “terrifying paths” that further escalation could take, he argued that it’s time to explore de-escalation measures, such as a ceasefire deal or a negotiated resolution.
These remarks come at a time when reports indicate that some administration officials are also urging Trump to find an exit from the war, as the recent surge in oil prices creates political risks.
Sources told Reuters that economic advisers and officials have informed Trump that increasing gasoline prices could rapidly erode already fragile domestic support for the war. On the other hand, more hawkish figures are pressing Trump to continue the campaign to stop Iran from developing a nuclear weapon.
A Trump adviser told Reuters, “He’s letting the hawks think the campaign is ongoing, wants markets to believe the war could end soon, and his base to think escalation will be kept in check.”