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The Office of the Comptroller of the Currency granted preliminary conditional approval on Friday, August 14, 2026 to World Liberty Trust Company, National Association, clearing a path for the firm to issue and redeem the USD1 stablecoin under direct federal banking supervision. The charter application was submitted in January.
The approval would let World Liberty take over functions currently performed by BitGo Bank & Trust, the exclusive issuer and custodian for USD1. Under the plan, the Bay Harbor Islands, Florida entity would issue USD1 to institutional clients nationwide, hold the reserves backing it, and provide digital asset custody as a fiduciary.
The decision drew objections before it was issued. World Liberty Financial states on its website that it is 38% owned by an entity affiliated with Donald J. Trump and certain family members, and Democratic lawmakers questioned whether regulators appointed by the president could review the application impartially.
"What makes a stablecoin trustworthy is the strength of the reserve behind it, and who stands accountable for it. We welcome continuous scrutiny from Federal regulators for many years to come." - Zach Witkoff, President and Chairman of World Liberty Trust Company
Key Takeaways
- The OCC granted preliminary conditional approval on August 14, 2026, following a January application.
- World Liberty would take USD1 issuance in house, assuming functions currently handled by BitGo Bank & Trust.
- Conditions include $20 million in capital, with at least half held in liquid assets.
- USD1 is the fourth-largest stablecoin at roughly $4 billion, launched in March 2025.
- The OCC says career staff conducted the review, responding to conflict-of-interest objections.
What the Charter Permits
A national trust charter is narrower than a commercial bank charter. It does not permit deposit-taking or conventional lending, and instead provides a single federal framework for custody, asset servicing, and settlement.
For a stablecoin issuer that structure covers the essential functions. World Liberty Trust would issue and redeem USD1, hold and manage the reserve assets, and safeguard digital assets for institutional customers such as exchanges and investment firms.
The OCC set specific preconditions before operations can begin. The bank must maintain at least $20 million in capital with a minimum of half in liquid assets, satisfy the conditions listed in the approval letter, and complete pre-opening requirements, and the agency retains authority to modify, suspend, or rescind the approval.
Governance arrangements were disclosed alongside the announcement. A five-member board pairs World Liberty Financial founders with independent directors drawn from accounting, regulatory, and financial backgrounds, with Mack McCain as Chief Trust Officer and former Hidden Road CFO Daniel Dietzel as Chief Financial Officer.
The Conflict-of-Interest Objections
Democratic lawmakers raised concerns after the January application, centring on the fact that the president appoints the officials heading the agency reviewing an application from a company partly owned by his family. Advocacy group Americans for Financial Reform has alleged the process was rushed.
The OCC addressed the question directly in its response. The agency said career employees conducted the review and that Comptroller Jonathan Gould and agency staff acted consistently with their statutory and ethical obligations.
The regulator also grounded the decision in statute. It said the proposed activities are permitted under federal banking law and noted that Congress expressly recognised the authority of uninsured national banks to issue stablecoins when it enacted the GENIUS Act.
Scrutiny of the OCC's charter programme predates this application. Senator Elizabeth Warren has pressed the agency on its crypto bank approvals more broadly, a campaign we covered in our Warren OCC oversight analysis, arguing the charters raise consumer protection and supervisory questions.
Why This Matters for Stablecoins
The charter would move a $4 billion stablecoin from third-party issuance into a federally supervised entity, which is the structural direction the GENIUS Act was written to encourage. It also captures economics that currently flow to BitGo, since reserve management and custody fees would move in-house.
The approval extends a pattern rather than breaking one. Circle received final OCC approval for a national trust bank earlier this year, detailed in our Circle OCC approval coverage, and Ripple and others have pursued the same route.
What distinguishes this case is not the charter type but the ownership. This is the first time a company in which a sitting president's family holds a disclosed stake has received a federal banking charter to issue and manage a stablecoin, and that fact is what has drawn congressional attention rather than any novelty in the application itself.
The regulatory backdrop remains unsettled. Charters are being granted while the rules governing permitted payment stablecoin issuers are still being written, which leaves newly chartered institutions building toward requirements that have not been finalised.
USD1's Position in the Market
USD1 launched in March 2025 and reached roughly $4 billion in market capitalisation, making it the fourth-largest stablecoin behind USDT, USDC, and USDe. Growth came largely through exchange distribution rather than retail adoption.
The token is backed by US dollars on deposit at financial institutions, US government money market funds, and cash equivalents. That composition aligns with GENIUS Act reserve requirements, though the framework's implementing rules remain incomplete, a delay we tracked in our GENIUS Act rulemaking analysis.
Distribution is broad across centralised venues. USD1 trades on Binance, Coinbase, Kraken, Bybit, OKX, Bitget, Gate, KuCoin, Crypto.com, and MEXC, alongside decentralised exchanges including Uniswap and PancakeSwap.
The institutional focus is deliberate. World Liberty has said the trust bank would serve exchanges, investment firms, and other institutional customers rather than retail users, which fits the trust charter's custody and settlement orientation.
Conclusion
The approval advances USD1 from third-party issuance toward direct federal supervision, which is a meaningful step for a token that has grown to fourth place in the stablecoin market in under eighteen months. Several conditions remain before the bank can open.
The political dimension will not resolve alongside the regulatory one. The OCC has stated that career staff handled the review under standard obligations, and critics have argued the ownership structure warrants closer examination, and both positions will persist through the remaining approval steps.
The wider pattern is what will matter longest. The OCC is chartering stablecoin issuers at a steady pace while Congress has not finished writing the rules those issuers will operate under, and that sequencing is likely to shape the debate well beyond this particular application.
FAQ:
1. What did the OCC approve for World Liberty?
The Office of the Comptroller of the Currency granted preliminary conditional approval on August 14, 2026 for World Liberty Trust Company, National Association, to operate as a national trust bank. The charter would allow it to issue and redeem the USD1 stablecoin, hold the reserves backing it, and provide digital asset custody to institutional clients.
2. Is the approval final?
No. World Liberty Trust must satisfy conditions in the approval letter and complete pre-opening requirements before beginning operations, including maintaining at least $20 million in capital with a minimum of half in liquid assets. The OCC retains authority to modify, suspend, or rescind the approval if circumstances change.
3. What changes for USD1?
USD1 is currently issued and custodied by BitGo Bank & Trust, National Association, the exclusive issuer for the token. Under the approved plan, World Liberty Trust would assume issuance, redemption, reserve management, and custody, bringing those functions under direct OCC supervision and in house rather than through a third party.
4. Why has the approval been criticised?
World Liberty Financial states on its website that it is 38% owned by an entity affiliated with Donald J. Trump and certain family members, and Democratic lawmakers questioned whether an agency headed by presidential appointees could review the application without a conflict of interest. The OCC responded that career employees conducted the review and that Comptroller Jonathan Gould and staff acted consistently with their statutory and ethical obligations.
5. How large is USD1?
USD1 has a market capitalisation of roughly $4 billion, making it the fourth-largest stablecoin, having launched in March 2025. It is backed by US dollars on deposit at financial institutions, US government money market funds, and cash equivalents, and trades on major centralised exchanges including Binance, Coinbase, and Kraken as well as decentralised venues.
Disclaimer:
This content is provided for informational and educational purposes only and does not constitute financial, investment, legal, or tax advice; no material herein should be interpreted as a recommendation, endorsement, or solicitation to buy or sell any financial instrument, and readers should conduct their own independent research or consult a qualified professional.
