Trump-Backed World Liberty Financial Wins Bank Charter, Deepening Clarity Act's Conflict of Interest Fight
The Trump family's crypto venture just picked up a conditional bank charter from a federal regulator, and the timing lands right in the middle of Washington's stalled fight over crypto market structure.
A BANK CHARTER FOR THE FIRST FAMILY OF CRYPTO
A federal financial regulator has conditionally approved an application for a bank charter by an entity connected to World Liberty Financial, a crypto firm partially owned by President Donald Trump's family. The Office of the Comptroller of the Currency on Friday gave conditional approval to World Liberty Trust Co.'s application for a national trust bank. The trust company is sponsored by World Liberty Financial, which says on its website it is 38% owned by "an entity affiliated with Donald J. Trump and certain of his family members."
The bank will be led by Zach Witkoff, CEO and chairman, who founded World Liberty Financial alongside President Donald Trump's three sons Eric Trump, Donald Trump Jr. and Barron Trump.
WHAT THE CHARTER ACTUALLY ALLOWS
The banking charter will enable World Liberty to issue stablecoins, a type of cryptocurrency that is backed by safe reserve assets such as U.S. Treasurys and is convertible one-to-one into U.S. dollars. The approval is not final. The charter application process won't be fully complete until the company completes additional steps, including raising capital. Among the conditions, World Liberty Trust must maintain a minimum of $20 million in tier 1 capital, at least half of which or $10 million, whichever is greater, must be held in eligible liquid assets.
THE CLARITY ACT COLLISION
The Clarity Act, the market structure bill meant to give crypto firms clear federal rules, has been stuck for months over a specific objection. Some congressional Democrats have refused to support the Clarity Act, a bill to regulate the crypto industry, because it doesn't impose strict limits on the president's ability to profit from crypto ventures. A bank charter for a company nearly two-fifths owned by the president's own family hands that argument a fresh, concrete example right as Congress prepares to return from recess in September.
TREASURY MOVES ON STABLECOINS ANYWAY
While the Clarity Act sits stalled, Treasury Secretary Scott Bessent is pushing forward on the other half of the crypto framework. "President Trump and Congress delivered the GENIUS Act, establishing a landmark framework and clear rules of the road for payment stablecoins, and Treasury is moving quickly to implement that framework," Bessent said. "Treasury welcomes input from stakeholders as we work to provide the regulatory certainty businesses need to innovate and grow in America, cement the role of the U.S. dollar as the world's reserve currency, and keep America the crypto capital of the world."
The result is two tracks moving in opposite directions. Stablecoin rulemaking under the GENIUS Act is advancing. The broader Clarity Act, the bill that would settle whether digital assets fall under the SEC or the CFTC, is now carrying a live conflict of interest example attached to the president's own family. That is a harder problem for lawmakers to talk around than a policy dispute, and it is the one Congress will be facing first when it returns in September.
This story comes from the Simply Bitcoin Live show. Watch the full episode.
