The Trump family's crypto empire is getting a bank. But not the kind you think

A crypto firm backed by President Trump's family just got preliminary approval for a bank - just not the type where you make an ATM withdrawal.

Why it matters: The move expands Trump's grip on the world of cryptocurrency, which delivered the president a $1 billion windfall last year alone.

- It would also mark an unprecedented arrangement: A sitting president's family would have a financial stake in a federally chartered bank.

Driving the news: The Office of the Comptroller of the Currency gave preliminary approval Friday for World Liberty Trust Company (WLTC) to obtain a national trust bank charter.

- WLTC is an affiliate of the Trump family-backed World Liberty Financial.
- DT Marks SC LLC, a corporate entity with ties to Trump's family, has an investment in the proposed bank, too. Eric Trump, son of Donald Trump, signed an agreement over that investment.

## Does this mean President Trump has a bank?

Not exactly. National trust bank charters, like the one conditionally awarded to WLTC, aren't your typical PNC or Bank of America - they don't allow firms to take deposits, offer checking or savings accounts or access FDIC insurance.

- WLTC won't even meet the technical definition of a "bank" as outlined by the Bank Holding Company Act.
- Instead, these banks can focus on digital assets and cryptocurrencies, and support services tied to those products such as custody, settlement, payments and asset management.

WLTC will specifically center around stablecoins, a form of crypto that holds a one-to-one value with the U.S. dollar.

## How this bank would make money

Zoom in: The OCC's conditional approval would allow Trump-backed WLTC to directly issue and redeem the stablecoin "USD1" to clients nationwide for U.S. dollars.

- Right now, the company BitGo handles key parts of USD1 for World Liberty. The new bank would bring several core services in-house.

How it works: WLTC could make money from the billions of dollars in reserves backing USD1.

- For example, if a company buys $1 billion worth of USD1, roughly $1 billion in reserve assets must back those tokens.
- Those reserves can earn interest while they remain in circulation - creating a financial incentive for WLTC to get more companies and investors using USD1.

## Trump's crypto empire expands

State of play: Trump and his family members have been planting a stake in the crypto game.

- Trump's financial disclosures showed more than $1 billion in crypto earnings last year, including $515 million in WLFI token sales and $65 million from equity sales tied to the venture's holding company.
- There was even noise of a crypto token tied to a Trump-branded Maldives resort, though that plan was delayed by the Iran war.
- Additionally, WLF's CEO, Zach Witkoff, is the son of Trump's Middle East negotiator, Steven Witkoff.

Friction point: That said, the OCC's approval has drawn criticism over conflict of interest concerns that Trump would have his own bank.

- "President Trump is now the first President in history to approve, operate, and supervise his own bank," Sen. Elizabeth Warren (D-Mass.) said after the OCC approval.
- "This is the most brazen act of self-dealing our financial system has ever seen - and Congress cannot allow it to stand," she said.

What they're saying: The OCC said career staff reviewed the application and generally supervise and enforce laws governing these chartered institutions.

What's next: WLTC must raise capital and other pre-opening requirements before receiving final approval.