Compass Investments

Eric Trump has agreed to limit his influence over the planned trust bank, World Liberty Financial.

World Liberty has received preliminary approval while regulators review the companys ownership and governance structure.

The charter will allow World Liberty to issue the USD1 and manage its reserves independently.

Eric Trump has agreed not to participate in decision-making regarding the planned national trust bank, World Liberty Financial, while the cryptocurrency business seeks federal approval.

Eric, World Liberty co-founder Zach Folkman, and UAE investor Hamad Khalfan Ali Matar Alshamsi have entered into personal commitments through their affiliated firms. These agreements stipulate that all three investors will not participate in the banks management.

These commitments became public when World Liberty received preliminary approval late last week. They relate to the companys ties to the Trump family, as well as foreign financial flows, as the subsidiary seeks to obtain a federal banking license. LINE_BREAK Such documents are referred to as passivity covenants. According to World Liberty, the purpose of these agreements is to ensure that certain investors do not exercise control over the trust bank.

Lawyers noted that this case will be treated as exceptional, since, in addition to a foreign investor with certain ties to the Abu Dhabi royal family, it involves the son of the head of state, which sets this situation apart from others. This also applies to other parties involved in the financial transactions.

World Liberty spokesperson David Waxman stated that the company plans to remain under federal supervision for many years to come.

World Liberty is consciously moving toward regulation and ongoing oversight, rather than avoiding them. Until it receives full approvaland for years afterwardWorld Liberty Trust will fully cooperate with the OCC, the federal regulator, and comply with all other applicable laws and regulations, Waksman said. , detected_source_language : EN

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The proposed cryptobank has come under closer scrutiny than other similar projects due to the ownership structure of World Liberty. Shortly before Donald Trump took office as president, World Liberty signed an agreement to sell 49% of its shares to an organization associated with Sheikh Tahnoun bin Zayed, the brother of the UAE president.

Trump and his family also have financial interests in World Liberty. The company asserts that none of them hold any position as an executive, director, or employee. The White House denies claims that Trumps business interests lead to a conflict of interest or that he is using his presidential powers for personal gain.

The federal review of applications for banking licenses includes a detailed examination of the financial status of the organizers and members of the board of directors. World Libertys documents mention Zach Witkoff, the son of Presidential Envoy Steve Witkoff. Also listed are Scott Alper, head of the Witkoff Group, and Robert Witkoff, Steves brother.

The articles of incorporation will allow World Liberty to directly own the assets that back the USD1its stablecoin pegged to the U.S. dollar.

This structure will allow the company to maintain issuance and control over reserves within a single organization, without resorting to external mechanisms. According to CoinGecko, USD1s market capitalization is approaching $4 billion, placing it among the worlds largest stablecoins.

The filing also comes amid broad changes in federal policy regarding cryptocurrency banking. Jonathan Gould, the U.S. Comptroller of the Currency, stated after taking office that approving new bank charters would be a priority for him.

This differs from the Biden administrations approach, which was far less favorable toward charter applications from companies dealing in digital assets.

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