What to know:
- World Liberty Financial says demand pushed USD1 circulation past the $4 billion mark.
- MGX used USD1 for its $2 billion Binance deal, boosting early institutional adoption.
- OCC approval and foreign ownership links keep World Liberty under political scrutiny.
World Liberty Financial has rejected claims that political connections drove USD1’s growth after its circulating supply passed $4 billion. CEO Zach Witkoff attributed the stablecoin’s rise to institutional demand as lawmakers continued examining the company’s ownership and foreign financial links.
CNBC reported on Aug. 25 that Witkoff presented USD1’s adoption as evidence of demand independent of favorable treatment from President Donald Trump’s administration. His comments followed preliminary federal approval for the company’s proposed national trust bank.
How Is World Liberty Financial Expanding USD1?
Launched in March 2025, USD1 ranks among the largest dollar-backed cryptocurrencies. World Liberty Financial says U.S. dollars held at financial institutions, government money market funds, and other cash equivalents back each token.
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Abu Dhabi-backed investment fund MGX contributed USD1 with an important institutional use case. The firm used the stablecoin for its $2 billion investment in Binance in May 2025.
The deal was announced by Witkoff at the TOKEN2049 event in Dubai as the “official stablecoin” of the transaction. MGX had revealed the investment in Binance back in March without specifying the settlement token.
While the transaction helped secure early adoption, Binance’s focus of USD1 became noticeable. According to a Forbes report in February based on Arkham Intelligence data, the wallets controlled by Binance and customers stored some $4.7 billion.
According to a report, the value constituted close to 87% of the total $5.4 billion supply of the stablecoin. USD1 circulation since then fell below that figure but continues to exceed $4 billion, according to World Liberty Financial. The stablecoin is traded on Coinbase, Kraken, Crypto.com, and various exchanges.
The Office of the Comptroller of the Currency granted preliminary conditional approval to World Liberty Trust Company on Aug. 14. WLTC Holdings LLC submitted the application in January.
According to the proposed model, the trust will have to issue and redeem USD1. It will have to deal with reserves and custody services. Currently, BitGo provides those services.
Retail deposits, checking services, and lending would not be provided by the trust bank. Its allowed operations are custody services, reserve management, settlement of stablecoins, and fiduciary services.
Why Is World Liberty Financial Facing Political Scrutiny?
According to Reuters, a firm associated with Trump controls 38% of World Liberty Financial’s holding company. Zach Witkoff is the son of Steve Witkoff, who is Trump’s envoy and an emeritus founder of the cryptocurrency company.
The White House has stated that Trump’s properties are in a trust controlled by his children. It has also stated that he is not managing World Liberty Financial during his presidency period.
Investigations became stronger because it was alleged that Aryam Investment 1 took a 49% interest in World Liberty Financial at $500 million. UAE National Security Adviser Sheikh Tahnoon bin Zayed Al Nahyan is the backer of the Abu Dhabi vehicle. Tahnoon also chairs MGX.
The Democratic senators in June called for hearings regarding the allegations. This was because they wanted to know whether the deal had any impact on America’s decision of selling arms or advanced AI chips to other nations.
The OCC had stated that foreign investors did not fit as the principle shareholders of the bank. Several investors had signed a document limiting their control over the bank’s affairs.
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