World Liberty Seeks National Trust Bank Charter for $3.3B Stablecoin Amid GENIUS Act Regulation

World Liberty Financial’s charter application is a milestone in its strategy to shift key stablecoin functions—issuance, redemption, custody, conversion—into a regulated banking entity. Rather than operate in a patchwork of state laws, a national trust bank charter would place USD1 squarely under federal rules, including those of the OCC and the GENIUS Act. This would strengthen legal certainty and likely broaden institutional adoption.

Financially, having more than $3.3–$3.4 billion in USD1 circulation within its first year gives WLF both leverage and risk. It must now satisfy rigorous auditing, reserve management, and governance standards. The GENIUS Act requires one-to-one reserve backing with low-risk assets—U.S. dollars and short-term Treasurys—which WLF claims to meet. Fulfilling operationally intensive requirements like segregated reserve accounts and frequent exams will be critical to regulatory approval.

The landscape of crypto firms securing trust charters under the Trump administration—Paxos, Circle, Ripple, BitGo, Fidelity—indicates a permissive momentum at OCC for stablecoin-related banking licenses. This sets a precedent and possibly lowers the political funding and regulatory thresholds for WLF, but also sharpens scrutiny over consistency and fairness.

Politically and ethically, WLF’s structure—with Donald Trump listed as “co-founder emeritus” and his three sons as active co-founders—raises concerns over conflicts of interest. Critics like Senator Warren argue that a regulatory agency with ties to the President reviewing a venture from which his family profits could erode trust in financial policy and oversight. Transparency around ownership, voting control, reserve audits, and regulatory safeguards will be crucial.

Strategic implications: If approved, WLF’s trust bank will compete with other stablecoin issuers who have or are acquiring trust charters, potentially consolidating USD1’s position among top stablecoins. It could also reshape how stablecoins interface with banking rails. Investors and traditional banks may consider partnerships or risks from regulatory arbitrage where entities—not full-service banks—offer bank-adjacent services under trust charters.

Open questions remain: What will the OCC conditions be? Can WLF maintain rigorous compliance, especially given high public exposure? How will pricing, fee structures, and accessibility compare across trust-chartered entrants? And politically, will Congress or watchdogs extract additional oversight or reform, particularly relating to conflicts of interest?