World Liberty Financial — a cryptocurrency venture closely associated with former U.S. President Donald J. Trump and his family — has submitted an application to the U.S. Office of the Comptroller of the Currency (OCC) to establish a national trust bank charter that would allow it to issue, custody, and redeem its flagship stablecoin, USD1. The move represents a major step in bringing a high-profile crypto project into the regulated U.S. banking system, while also igniting political debate and regulatory scrutiny.
What is World Liberty Financial and USD1?
World Liberty Financial (often abbreviated WLFI) is a decentralized finance (DeFi) company that launched in 2024 and quickly rose to prominence in the stablecoin market. The platform was co-founded by members of the Trump family — with Donald Trump listed as co-founder emeritus on the company’s website — alongside business partner Steve Witkoff and others. Its primary product, USD1, is a stablecoin pegged 1:1 to the U.S. dollar and backed by U.S. dollar deposits and short-term U.S. Treasury assets.
Since its launch, USD1 has grown rapidly, with an estimated circulating supply exceeding $3.3 billion, making it one of the larger stablecoins in the world by market value. That growth has been driven not only by trading demand, but also by a series of integrations with exchanges and blockchain networks.
The Bank Charter Application: What It Means
On January 7, 2026, WLFI’s affiliate — WLTC Holdings LLC — filed a “de novo” application with the OCC to form a national trust bank, provisionally named World Liberty Trust Company, National Association. If approved, the charter would permit WLTC to issue and redeem USD1, hold custody of stablecoin reserves, and provide related digital asset services under federal supervision — rather than relying on third-party custodians or state licenses.
Unlike a full commercial bank that can take deposits and make loans, a national trust bank has a narrower scope: it can provide custodial and fiduciary services, settlement, and asset management functions — including stablecoin operations. This model is increasingly attractive to crypto firms seeking regulatory certainty while staying within the U.S. banking framework.
World Liberty Financial asserts that the charter would allow USD1 to be issued and redeemed directly by its trust bank — offering fee-free conversion between U.S. dollars and USD1 — and provide institutional customers with custodial solutions and stablecoin conversion services.
Why This Matters for Stablecoins and Crypto Regulation
The push to secure a federal bank charter comes amid a broader evolution in how the U.S. treats stablecoins. After years of regulatory ambiguity, Congress passed the GENIUS Act in 2025, which established a national framework for regulating stablecoins and clarified certain compliance obligations. World Liberty has said it intends to operate in accordance with that law, including anti-money-laundering and sanctions-screening requirements.
The OCC has recently signaled a willingness to bring regulated crypto firms into the banking system. Conditional approvals for national trust charters have been granted to firms such as Circle, BitGo, Ripple, Paxos, and Fidelity Digital Assets — but only Anchorage Digital has received final bank charter approval so far. World Liberty’s application places it among a growing group seeking to blur the lines between crypto and traditional banking.
For crypto markets, a federally chartered stablecoin issuer offers potential benefits, including reduced counterparty risk and clearer compliance expectations. Institutional investors and financial institutions have historically cited regulatory uncertainty as a barrier to greater adoption of crypto assets; a trust bank could provide a pathway to mainstream engagement.
The Political Angle: Ties to Trump and Controversy
Unlike Circle’s USDC or Tether’s USDT, USD1’s issuer is politically connected. World Liberty Financial prominently features Trump-family involvement, which has fueled debate about conflicts of interest in stablecoin regulation and enforcement.
Critics point to Trump’s dual roles as a political leader and a figure with ongoing financial interests tied to World Liberty — including potential revenue from USD1 fees and interest income — as raising ethical concerns. A 2025 letter from U.S. Senate Democrats (including Elizabeth Warren) sought documentation of communications between World Liberty and federal agencies, highlighting anxiety about whether political influence could affect oversight and enforcement.
The political dimension intensified when USD1 was used in a high-profile transaction — a reported $2 billion investment in Binance by the Abu Dhabi-backed fund MGX, settled in USD1. Such activity has drawn attention in Washington and among regulators worldwide.
Supporters of WLFI argue that its federal charter pursuit is a legitimate strategy to bring stablecoins fully onshore and bolster the U.S. role in digital finance. They contend that clearer regulation and federal supervision will enhance safety, compliance, and competitiveness. Detractors, however, worry that Washington policy could be influenced by personal financial interests, blurring the line between public duties and private benefit.
Market and Industry Implications
Should the OCC approve World Liberty’s bank charter, the stability and legitimacy of USD1 could increase significantly. A federal charter could reduce reliance on third-party custodian relationships — which expose stablecoin holders to additional counterparty risk — and enable direct oversight of reserve management and redemption processes. This would make USD1 more attractive to institutional adopters and large financial firms seeking compliant dollar-pegged instruments.
For the broader crypto industry, a successful charter could set a precedent. Other stablecoin issuers or crypto firms may follow suit, pursuing national trust charters to embed their operations within traditional finance infrastructure. That trend could accelerate the integration of digital assets into banking systems — but it also raises questions about how regulators balance innovation with safety and systemic risk.
Challenges and Regulatory Hurdles
Despite potential upsides, hurdles remain. The OCC has not yet publicly commented on the application, and the timeline for approval — if it comes — is uncertain. National bank charters undergo rigorous review, including assessments of financial soundness, risk management, compliance systems, and governance structures.
Stablecoin regulation itself is still evolving. While the GENIUS Act provides a baseline, ongoing debates in Congress and among regulators about issues like stablecoin backing standards, yield-bearing tokens, and consumer protections could influence how charters are granted and supervised. The Federal Reserve, Securities and Exchange Commission (SEC), and Treasury all play roles in shaping the rules that govern digital assets, which means World Liberty’s application will be scrutinized from multiple angles.
Moreover, political opposition may intensify as World Liberty’s charter bid progresses. Opponents may argue that a politically tied stablecoin issuer should not gain federal banking privileges, pointing to the need for impartial oversight free from perceived conflicts. Any actual or perceived ethical lapses could spark legislative action or delay approvals.
Competition and the Stablecoin Landscape
USD1 enters a crowded but rapidly evolving market dominated by stablecoins like USDC, USDT, and others. Those incumbents have larger market capitalizations and deeper liquidity networks, partly due to years of exchange integrations and institutional adoption.
World Liberty has been actively expanding USD1’s footprint. In late 2025, major exchange Binance expanded support for USD1, adding new trading pairs and zero-fee incentives to bolster liquidity — a move that strengthened the token’s presence in global markets. Other integrations, such as cross-chain support via oracle networks like Chainlink and partnerships with blockchains like BNB Chain, have helped broaden USD1’s access across decentralized finance environments.
Yet adoption remains uneven, and institutional players may be cautious until there is regulatory clarity. A federal charter could tip the balance by giving institutional custodians — including banks, asset managers, and traditional financial intermediaries — greater comfort in holding and transacting with USD1.
Looking Ahead: Impact on Traditional Finance
If World Liberty’s charter is approved, the implications extend beyond crypto. It would highlight how digital assets are reshaping financial services infrastructure, forcing traditional banks and regulators to reckon with new forms of money and settlement systems. Stablecoins that operate within the regulated banking system — backed by secure reserves and subject to federal oversight — could increasingly serve as bridges between decentralized networks and legacy finance.
This shift could prompt legacy financial institutions to accelerate their own digital asset strategies, whether through partnerships, custodial services, or issuance of bank-backed digital currencies. It might also influence central bank discussions around central bank digital currencies (CBDCs) as policymakers consider how private stablecoins coexist with national digital currencies.
Conclusion
World Liberty Financial’s push for a U.S. national trust bank charter to issue and custody its USD1 stablecoin is a watershed moment at the intersection of crypto, finance, and politics. With a market value in the billions and backing from high-profile figures, USD1’s path to federal banking status could transform how stablecoins operate under U.S. law — for better or worse.
While proponents argue that a charter brings regulatory certainty and institutional credibility, critics remain wary of political entanglements and ethical tensions. As the OCC evaluates the application and lawmakers continue debating digital asset policy, the outcome will reverberate across markets and regulatory halls alike — shaping the future of stablecoins and the role of digital assets in global finance.