Trump-linked crypto firm receives conditional bank charter amid ethics concerns
Regulators appointed by President Trump have granted World Liberty Financial a preliminary conditional approval to become a trust bank, prompting criticism from lawmakers and ethics watchdogs over potential conflicts of interest.
World Liberty Financial, a cryptocurrency venture launched by President Donald Trump and his sons in 2024, announced it received a preliminary conditional approval from banking regulators to operate as a trust bank. The charter, which does not permit the firm to take deposits or make loans, would allow it to issue its dollar-backed stablecoin, USD1, without relying on third-party intermediaries.
The approval was issued by the Office of the Comptroller of the Currency, with final approval contingent on meeting a series of conditions. The firm’s spokesperson, David Wachsman, said the charter would provide "robust and permanent" regulatory supervision that would extend beyond the current administration.
Critics argue the decision creates significant conflicts of interest. Former ethics lawyer Richard Painter warned that having the president and his family heavily invested in a regulated industry while overseeing regulators is "quite precarious." Senate Banking Committee ranking member Elizabeth Warren called the move "the most brazen act of self-dealing" in the financial system and said Democrats will introduce legislation to bar federal regulators from approving banks owned or controlled by senior officials.
The White House responded that all of President Trump’s investment holdings are managed in fully discretionary accounts by independent third parties, and dismissed the criticism as a recurring narrative.
World Liberty’s bank charter includes an agreement in which DT Marks SC LLC, a Trump family entity, will act as a passive investor, pledging not to influence the bank’s operations or hold an officer position. Nonetheless, the Trump family stands to benefit financially from the firm’s expanded role.
Financial disclosures show Trump earned more than $526 million from the sale of tokens tied to World Liberty last year and about $263 million from an equity sale to investors led by a United Arab Emirates royal.
Industry observers note that the charter could delay congressional action on the Clarity Act, legislation intended to provide a comprehensive regulatory framework for cryptocurrencies.