Senators question OCC and FED on Trump's WLFI stablecoin oversight
Senators raise alarms over Trump-linked stablecoin
A group of five U.S. Senate Democrats, led by Senator Elizabeth Warren, is urging top financial regulators to scrutinize World Liberty Financial (WLFI) and its newly launched stablecoin, USD1, over concerns about conflicts of interest stemming from direct involvement by President Donald J. Trump and his family.
Key Takeaways
- U.S. senators urged regulators to examine risks from Trump’s involvement in WLFI and USD1. - Trump and his family control 60% of WLFI, raising conflict of interest concerns.
- WLFI has raised $550M and launched USD1 on Ethereum and BNB Chain.
- The GENIUS Act could impact how WLFI and other stablecoins are regulated.
In a letter dated March 28, lawmakers asked Federal Reserve Board Governor Michelle Bowman and Acting Comptroller of the Currency Rodney Hood to explain how their agencies plan to regulate WLFI. The letter warns that Trump’s influence over the project — combined with his February executive order mandating coordination between federal agencies and the White House — poses “unprecedented risks” to the U.S. financial system.
“The launch of a stablecoin directly tied to a sitting President who stands to benefit financially from the stablecoin’s success presents unprecedented risks to our financial system,” the senators wrote.
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Regulatory and legislative backdrop
The request comes amid ongoing debate in Congress over the GENIUS Act, legislation aimed at creating a federal framework for stablecoin oversight. If passed, the bill would grant supervisory powers to both the Federal Reserve and the Office of the Comptroller of the Currency, including over firms like WLFI.
Since its September 2024 launch, WLFI has drawn scrutiny for its opaque operations and the fact that Trump and his family reportedly control 60% of the firm’s equity. The company has already raised $550 million across two token sales and recently debuted USD1 on Ethereum and BNB Chain. Trump’s son, Donald Trump Jr., promoted the stablecoin at the DC Blockchain Summit alongside WLFI’s co-founders.
WLFI portfolio. Source: Arkham.
Concerns over regulatory independence
Lawmakers fear that Trump’s involvement could compromise the independence of financial regulators. The letter explicitly links his dual role as president and beneficiary of WLFI to broader concerns about fairness and integrity in rulemaking, especially as the stablecoin sector awaits clear federal oversight.
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