World Liberty Financial Applies for Banking Charter for USD1 Stablecoin

TLDR

• World Liberty Financial’s subsidiary WLTC Holdings filed for a national trust banking charter with the Office of the Comptroller of the Currency
• The charter would allow World Liberty to issue, custody and redeem its USD1 stablecoin in-house instead of using third-party providers
• The trust bank would offer fee-free minting and redemption of USD1 and enable conversion between US dollars and the stablecoin
• President Donald Trump is listed as co-founder emeritus with his three sons as co-founders, though the trust company would operate separately
• The OCC previously granted banking charters to Circle, Ripple, Fidelity Digital Assets, BitGo and Paxos in December

World Liberty Financial applied for a national trust banking charter this week to expand its USD1 stablecoin operations. The application was filed by WLTC Holdings, a subsidiary of World Liberty Financial, with the Office of the Comptroller of the Currency.

The charter would allow World Liberty to handle the full lifecycle of its USD1 stablecoin internally. Currently, the company relies on third-party providers like BitGo for these services.

World Liberty CEO Zach Witkoff said institutions are already using USD1 for cross-border payments, settlement and treasury operations. He stated the national trust charter would let them bring issuance, custody and conversion together under one regulated entity.

The proposed trust bank would offer several services to institutional customers. These include cryptocurrency exchanges, market makers and investment firms.

Fee-Free Stablecoin Operations

Customers would be able to mint and redeem USD1 without fees under the new structure. The trust company would also provide conversion services between US dollars and USD1.

The bank would custody USD1 and other stablecoins for clients. This represents a shift from the current model where external providers handle these functions.

World Liberty Financial has connections to President Donald Trump. The company’s website lists Trump as co-founder emeritus.

Trump’s three sons – Eric, Barron and Donald Trump Jr. – are named as co-founders. The company is partly owned by DT Marks DEFI LLC, which is controlled by Trump and his family.

Separate Operating Structure

A World Liberty Financial spokesperson clarified the relationship between the entities. They stated World Liberty Financial did not apply for the charter directly.

Instead, World Liberty Trust Company, a proposed separate entity, submitted the application. The spokesperson said the companies share branding and names but have different ownership and operating structures.

Witkoff would serve as president and chairman of the trust company if approved. He emphasized that the structure was designed to avoid conflicts of interest.

The Trump family would not serve as executives or exercise day-to-day control of the trust company business. This separation aims to address concerns about potential conflicts given Trump’s position as president.

The OCC has shown increased openness to crypto banking charters. In December, the regulator granted conditional approvals to five crypto firms.

Circle, Ripple, Fidelity Digital Assets, BitGo and Paxos all received charters to operate trust banks. This marked a shift from the more cautious stance during the previous administration.

Jonathan Gould, the current Comptroller of the Currency, said new entrants provide access to new products and services. He stated they help ensure a dynamic and competitive banking system.

Stablecoins in the US are now governed under the GENIUS Act. Trump signed the legislation into law last year.

Federal agencies including the Treasury Department are still working out specific regulatory provisions. Lawmakers are set to vote on crypto market structure bills next Thursday.

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