World Liberty wins OCC bank charter for $4B USD1 stablecoin

The OCC granted World Liberty Financial conditional approval Aug. 14 to establish a national trust bank issuing the USD1 stablecoin, bringing the Trump family-backed venture's $4 billion operation under federal oversight.

"President Trump is now the first President in history to approve, operate, and supervise his own bank," Sen. Elizabeth Warren, D-Mass., said, calling it "the most brazen act of self-dealing our financial system has ever seen." Warren said she and colleagues would introduce legislation to prevent presidents and senior government officials from owning or controlling banks.

The conditional charter for World Liberty Trust Co. requires $20 million in Tier 1 capital, with at least $10 million held in eligible liquid assets such as cash or short-term Treasuries, plus 180 days of operating expenses in reserve. The OCC's review took 221 days — nearly double the 120-day period Comptroller Jonathan Gould had advertised for charter applications. The Trump family owns 38 percent of World Liberty Financial, while a UAE investment firm holds nearly 49 percent, according to Reuters and The Wall Street Journal.

The approval lets World Liberty take direct control of USD1 custody from BitGo Bank and Trust, where the stablecoin is currently held. USD1, a dollar-pegged token, has reached $4 billion in circulation, making it the fourth-largest stablecoin globally. The decision follows the OCC's December 2025 conditional approvals for Circle, Ripple, Paxos, BitGo, and Fidelity Digital Assets — with Circle receiving final approval in July 2026 — as stablecoin issuers increasingly pursue federal banking charters under the GENIUS Act framework.

$20M capital floor and the GENIUS Act framework

The regulatory framework derives from the GENIUS Act, signed into law in July 2025, which established federal standards for payment stablecoin issuers. Under the act, issuers must maintain reserves backed dollar-for-dollar by high-quality liquid assets such as cash or short-term US Treasuries. Large issuers with $25 billion or more in outstanding issuance must maintain at least 0.5 percent of reserve assets in bank or credit union deposits on each business day.

The five-member board governing World Liberty Trust includes Zach Witkoff, co-founder and CEO of World Liberty Financial and son of Trump's Middle East negotiator Steven Witkoff, as chairman. Other directors include Scott Alper, president and chief investment officer of Witkoff Group; Robert Witkoff, former co-chief investment officer of Chubb; Jeffrey Weiner, former CEO of Marcum; and Erin Baskett, a member of FINRA's board of governors.

Warren, Blumenthal, Reed lead Democratic attack

The approval has drawn sharp criticism from Democratic lawmakers and consumer advocates. Sen. Richard Blumenthal, D-Conn., said the approval "puts our banking system in danger," while Sen. Jack Reed, D-R.I., accused the Trump family of "gaming the system to enrich itself at the expense of ordinary taxpayers."

Americans for Financial Reform Education Fund opposed the conditional approval, citing World Liberty's business relationships with foreign investors and concerns about stablecoin volatility and fraud risks. The OCC defended the process, stating that approvals are made under authority delegated by the Comptroller to career staff, who reviewed the application in accordance with established policies and procedures.

World Liberty CEO Zach Witkoff defended the approval in a Wall Street Journal op-ed, noting that five competitors received conditional approvals nine months before World Liberty. He also pointed to passivity commitments that DT Marks, the Trump family holding company, entered into with the OCC to ensure it wouldn't exercise control over World Liberty.

The charter does not extend to depository services, and World Liberty Trust will not issue, custody, or deal in World Liberty tokens. The bank's digital asset custody services will operate primarily for USD1 customers and other institutional clients, with conversion services allowing custody customers to exchange approved stablecoins for USD1.

USD1's $4 billion market cap compares with roughly $183 billion for Tether and over $70 billion for Circle's USDC. The stablecoin's relatively small footprint has led some analysts to question the commercial rationale for the charter, with Georgetown University professor James Angel suggesting the primary motivation for depositors would be "to curry favor with the Trump administration."

This article is for informational purposes only and does not constitute investment advice.