OCC Gives Preliminary Approval to World Liberty Trust Bank Charter, Paving Way for USD1 Issuance

The Office of the Comptroller of the Currency has conditionally granted preliminary approval for the creation of a trust bank by World Liberty Financial, the cryptocurrency company backed by US President Donald Trump’s family.

Reuters reported on August 15 that the OCC approved World Liberty Trust Company’s application for a national trust bank charter, which the firm filed in January. If the charter receives final approval, World Liberty would be able to issue its USD1 stablecoin directly and hold the reserve assets itself.

With a final charter, the newly established trust bank would be able to custody and manage client assets and process payments. It would not be permitted to accept deposits or make loans like a conventional bank.

The approval would also allow World Liberty to directly issue USD1 and custody the dollar reserves now handled by its business partner, BitGo.

Zach Witkoff, chairman and president of World Liberty Trust, called the preliminary approval an "important milestone." He said a national trust bank would let the firm bring USD1 issuance, custody and reserve management together under OCC supervision.

The approval also carries additional conditions. World Liberty must notify the OCC of any major changes to its business plan, maintain at least $20 million in capital and hire qualified personnel to oversee internal audits.

USD1, a dollar-pegged stablecoin launched in March last year, now has a market capitalization of about $4 billion. Reuters reported that it has become the world's fourth-largest stablecoin.

The approval has also drawn conflict-of-interest scrutiny. Some Democratic lawmakers have raised concerns about regulators appointed by Trump reviewing a bank charter application for a company tied to the president’s family. The OCC said the review was conducted by career staff and handled in accordance with relevant legal and ethical obligations.