Banking and Finance Law Daily Wrap Up, BANKING OPERATIONS—Trump-affiliated crypto bank charter approved amid concern as Democrats pursue legislative response, (Aug 17, 2026)
Organizations Mentioned:Nautilus Minerals, Inc. | Wlit, Inc.
By Joe Cox, J.D.
The OCC approved World Liberty’s trust company application amid statements of concern and a new bill introduced by Democratic Senators.
The Office of the Comptroller of the Currency (OCC) has approved the application of World Liberty Trust Company, National Association (World Liberty) to establish a new national trust bank. The Bank’s proposed activities, per the letter of approval, include dollar-backed stablecoin issuance and redemption and reserve maintenance in a nonfiduciary capacity; digital asset custody services as a fiduciary; and conversion services for custody customers in connection with their custodied assets. World Liberty plans to issue USD1, a fiat currency-backed stablecoin, and will allow customers to exchange approved stablecoins for USD1.
The approval letter notes the receipts of several comment letters, many of which raised concerns about conflicts of interest regarding President Trump and/or members of his family. The Trump family’s connections with World Liberty are well-documented and were brushed aside by the OCC in its letter of approval, with the letter noting, “The Comptroller and staff acted consistently with their statutory duties and ethical obligations with respect to the Application.”
The approval of World Liberty is noted as conditional, as it is incumbent on the company meeting certain financial requirements, such as maintaining a minimum of $20 million in tier 1 capital of which the greater of at least 50 percent of its tier 1 capital or $10 million must be held in Eligible Liquid Assets.
Criticism of Approval. The approval generated immediate response, with Americans for Financial Reform (AFR) condemning the decision in a press release. AFR noted, “The rush to bestow the special powers of bank charters on crypto firms dangerously blurs the congressionally mandated barrier between banking and commerce, posing considerable risks to customers and the stability of the financial system that could lead to public bailouts of foundering crypto banks.”
AFR termed the approval as “perilous” and argued that “[t]he Trump family will capture the benefits of a bank charter but leave customers, the economy, and the public bearing all of the risks.” Aside from the issues with conflicts of interest, AFR noted the bank approval as “another example of the crypto industry’s demand to access all of the benefits of the mainstream financial system without complying with the statutory obligations or requirements for banks.”
Legislative Response. In response to the OCC’s decision, a group of nine Democratic Senators plus Independent Senator Bernie Sanders (I-Vt.) introduced the Ending Presidential Corruption in Banking Act in the U.S. Senate. In an accompanying press release, Senator Elizabeth Warren (D-Mass.), Ranking Member of the Senate Banking, Housing, and Urban Affairs Committee stated, “President Trump is now the first President in history to approve, operate, and supervise his own bank. This is the most brazen act of self-dealing our financial system has ever seen—and Congress cannot allow it to stand. The Ending Presidential Corruption in Banking Act will close the door on this kind of unprecedented corruption.”
The central tenants of the proposed legislation are that it would:
prohibit the Federal Reserve Board, Office of the Comptroller of the Currency, and Federal Deposit Insurance Corporation from approving a range of banking applications, including charters, deposit insurance, and master accounts if the applicant is owned or controlled by the President, Vice President, a spouse or child of the President or Vice President, a Member of Congress, a presidentially appointed executive branch official, or a special government employee.
require the agencies, no later than 60 days after enactment, to review all banking applications granted after January 20, 2025, and terminate those that were approved while a covered person owned or controlled the applicant.
prohibit the President, Vice President, and a child or spouse of the President or Vice President from owning or controlling a bank.
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