World Liberty wins preliminary OCC approval to form national trust bank, aiming to take over USD1 issuance and custody World Liberty Financial has secured conditional, preliminary approval from the Office of the Comptroller of the Currency (OCC) to organize a national trust bank that would issue the dollar-backed stablecoin USD1, manage its reserves, and provide digital-asset custody across the United States. What the approval means—and what it doesn’t The OCC’s Aug. 14 decision clears the way for World Liberty Trust Company, National Association—a proposed wholly owned subsidiary of Delaware-registered WLTC Holdings LLC based in Bay Harbor Islands, Florida—to be organized. But preliminary approval only permits the company to form the bank; it does not authorize the bank to begin operations. Final OCC authorization is required after World Liberty completes preopening conditions. Conditions the bank must meet before opening include applying for stock in a Federal Reserve Bank, maintaining at least $20 million in eligible capital, and receiving the OCC’s written confirmation that all opening requirements are satisfied. The OCC also warned it could modify, suspend, or withdraw the conditional approval if new information raises concerns. What the bank would do Under its proposed charter, World Liberty Trust would not be a traditional commercial bank—its activities would be limited to trust, custody, reserve management, and related payment services. The bank plans to: - Issue and redeem the USD1 stablecoin for institutional clients nationwide. - Hold and manage the reserves backing USD1. - Provide custody services and allow custody clients to convert approved stablecoins into USD1 using assets already held at the institution. Legal and regulatory basis In its decision, the OCC cited the National Bank Act and the GENIUS Act as statutory authority for national trust banks to provide digital-asset custody and issue payment stablecoins. The agency noted that uninsured national trust banks it supervises had $7.2 trillion in assets under administration as of March 31, including $1.7 trillion in custody and safekeeping accounts. Planned takeover of USD1 issuance and safeguards World Liberty Trust intends to replace BitGo Bank & Trust as the exclusive issuer and custodian of USD1, acquiring the token’s reserve assets and assuming related liabilities. BitGo will remain responsible for USD1 issuance and custody until World Liberty completes the OCC’s conditions. The OCC approved an exemption from certain limits and collateral rules under Regulation W to enable the planned transfer, though federal rules governing bank-affiliate transactions and potential bank-merger requirements could still apply depending on the final transfer structure. Industry context World Liberty joins a string of crypto firms seeking federal trust bank charters. The OCC issued conditional approvals for several applicants—including Circle, Ripple, BitGo, Fidelity Digital Assets, and Paxos in December 2025—and later approved Coinbase, Crypto.com, and Bridge (owned by Stripe). Circle has already completed preopening steps and obtained final authorization in July, underscoring that conditional approval is only an initial step. Political scrutiny and conflict-of-interest concerns The application has attracted intense political scrutiny because of ties to former President Donald Trump and his family. World Liberty’s website indicates a Trump family-linked entity controls about 38% of its equity interests. Critics raised potential conflicts after Trump nominated Comptroller Jonathan Gould in 2025; Senator Elizabeth Warren and others asked the OCC to pause its review until Trump divested his financial interest. Gould faced questioning during a Senate Banking Committee hearing; the OCC stated that career staff reviewed the application and that the Comptroller and staff acted consistently with statutory duties and ethical obligations. The OCC said it received seven public comments from four commenters, including objections that the proposed activities exceeded a national trust bank’s powers and that the public lacked sufficient information. The agency rejected those objections, finding that World Liberty submitted required materials on time and that the comment period complied with federal rules. Legislative response Shortly after the OCC’s decision, Senator Warren and nine other senators introduced the Ending Presidential Corruption in Banking Act. The bill would bar the president, vice president, their spouses, and their children from owning or controlling a bank and would require federal agencies to review approvals issued since Jan. 20, 2025. “This is the most brazen act of self-dealing our financial system has ever seen — and Congress cannot allow it to stand,” Warren said. Foreign investment and national-security questions Congressional scrutiny has also focused on World Liberty’s foreign investors. Reports say an Abu Dhabi-backed entity tied to UAE National Security Adviser Sheikh Tahnoon bin Zayed Al Nahyan purchased a 49% interest in World Liberty for $500 million under a January 2025 agreement. Five Democratic senators asked for hearings into whether that investment influenced later U.S. decisions related to UAE arms sales or access to advanced AI chips. The OCC reviewed these concerns and concluded those foreign investors were not principal shareholders of the proposed bank. Several investors—StringZ Holdings, DT Marks SC, and AMGUS—signed commitments in July promising not to control or influence bank operations (no board seats, hiring control, or access to material nonpublic information). Eric Trump signed one of those commitments for DT Marks on behalf of the Trump family-linked entity. The OCC also restricted how voting rights above certain thresholds could be exercised. Wider market implications and remaining questions Other ties to the UAE have intersected with USD1’s broader circulation. MGX, another Abu Dhabi entity chaired by Sheikh Tahnoon, used $2 billion in USD1 to invest in Binance in May 2025, a transaction that helped swell the token’s supply. A February report citing Arkham Intelligence indicated Binance-controlled wallets and customer accounts held roughly $4.7 billion of USD1—about 87% of a $5.4 billion supply at that time. Binance and World Liberty have denied any improper relationship; Binance noted exchanges routinely custody large amounts of listed assets. Next steps World Liberty must complete the OCC’s preopening requirements and obtain final federal authorization before taking over USD1 issuance and custody. If additional federal merger or affiliate-transaction rules are triggered by the reserve transfer, the bank will need further regulatory clearance. Meanwhile, political and congressional scrutiny, ongoing public debate over foreign investment, and proposed legislation could shape the firm’s path to full authorization. World Liberty’s chairman and president Zach Witkoff framed the plan as concentrating USD1 issuance, custody, and reserve management under one federal regulator: “A national trust bank brings USD1 issuance, custody, and reserve management together under OCC supervision, examined on the same standards that have governed banks for generations,” he said, adding the firm welcomed continuous federal scrutiny. Read more AI-generated news on: undefined/news