Crypto
Home›Crypto›Regulation›World Liberty Financial gets OCC approval to charter t…
World Liberty Financial gets OCC approval to charter trust bank
The OCC’s preliminary conditional approval would place USD1 issuance and reserve custody under federal oversight, after earlier WLFI token leverage concerns tied to Dolomite.
The Office of the Comptroller of the Currency has granted World Liberty Financial, a DeFi venture linked to President Donald Trump, preliminary conditional approval to charter a national trust bank through its World Liberty Trust Company, with the entity planned to support USD1 issuance and reserve custody directly.
According to CryptoSlate, final approval depends on conditions still in place, but the steps would move USD1 issuance and reserves under federal supervision if the bank clears requirements. The filing also arrives months after fallout from a World Liberty leverage scare centered on its WLFI token, which the company says it resolved.
In April, World Liberty pledged 5 billion WLFI tokens, about 5% of total supply at the time, as collateral on the Dolomite lending protocol and borrowed about $75 million in stablecoins, draining the USD1 lending pool to full utilization and leaving some depositors unable to withdraw normally.
CryptoSlate reports that more than $40 million of the borrowed funds moved to Coinbase Prime, and World Liberty repaid $15 million on April 9 and another $10 million two days later for $25 million total. WLFI later traded around $0.058, down about 35% from its April level near $0.089, which would raise the loan to value ratio back toward roughly 17.2% if the remaining $50 million debt stays paired with the same 5 billion-token collateral block.