Nikolas Sargeant
TL;DR
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The Office of the Comptroller of the Currency has conditionally approved World Liberty Financial’s application to establish a national trust bank.
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The proposed bank would support the issuance and redemption of World Liberty Financial’s USD1 stablecoin alongside custody, conversion, and payment services.
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USD1 has a market capitalization of approximately $4 billion, making it the fourth-largest stablecoin.
World Liberty Financial, the cryptocurrency company backed by US President Donald Trump and his family, has secured preliminary approval to establish a national trust bank.
The Office of the Comptroller of the Currency (OCC) issued conditional approval to World Liberty Trust Company, National Association on Friday.
The decision moves the company closer to obtaining a federal banking charter but does not authorize it to begin operations immediately.
In its approval letter, the OCC said World Liberty Financial’s proposal had met certain regulatory and policy requirements. The company must now fulfil the regulator’s remaining conditions before it can receive final authorization.
The OCC retains the power to withdraw its preliminary approval if World Liberty Financial fails to meet those requirements.
Proposed Bank Would Support the USD1 Stablecoin
World Liberty Financial established a new trust company earlier this year as part of its effort to obtain an OCC charter.
The company said the license would allow it to bring more of its stablecoin infrastructure onshore and provide issuance, redemption, custody and conversion services. It also intends to operate fiat-to-crypto on-ramps and crypto-to-fiat off-ramps.
World Liberty Financial issues USD1, a dollar-pegged stablecoin with a market capitalization of approximately $4 billion. The token ranks as the fourth-largest stablecoin, behind leading products including Tether’s USDT and Circle’s USDC.
The company plans to serve institutional customers such as cryptocurrency exchanges, investment firms and market makers.
World Liberty Financial CEO Zack Witkoff said the company’s ambition is to develop a widely used and trusted digital dollar while reinforcing the US currency’s position in the global economy.
Witkoff is the son of Steve Witkoff, Trump’s special envoy to the Middle East.
OCC Opens Banking Pathway for Crypto Companies
World Liberty Financial joins several cryptocurrency businesses that have received conditional approval for national trust bank charters over the past year.
Coinbase, Paxos, BitGo, Ripple and Circle have also secured preliminary approvals as the OCC adopts a more accommodating approach to companies dealing with digital assets.
Comptroller of the Currency Jonathan Gould has argued that businesses using cryptocurrency and other emerging technologies should have a pathway to become federally regulated financial institutions.
Gould previously served as the chief legal officer of cryptocurrency infrastructure company Bitfury.
World Liberty Financial’s ties to the Trump family have attracted scrutiny from Democratic lawmakers, who argue that the administration could influence regulations affecting the company’s profitability.
In January, Senator Elizabeth Warren urged Gould to suspend the OCC’s examination of World Liberty Financial’s application until Trump divested from the business and eliminated potential conflicts involving himself and his family.
Financial disclosures released in June showed that Trump had received millions of dollars in income connected to World Liberty Financial.
Warren warned that approving the charter would leave the OCC responsible for creating rules affecting the president’s company while simultaneously supervising it, enforcing financial laws against it and regulating its competitors.
Despite securing conditional approval, World Liberty Financial must complete the OCC’s organizational and regulatory requirements before its proposed national trust bank can begin operating.
