Bank Approved

US regulators approved the launch of Erebor – a new bank backed by a group of tech billionaires with close ties to President Trump.

Context

Erebor was founded in 2025 by Palmer Luckey and Joe Lonsdale following the 2023 collapse of Silicon Valley Bank, which had served as a primary institution for tech start-ups and venture capital firms. The new bank aims to serve businesses involved in cryptocurrency, artificial intelligence, defense, and related sectors. The name “Erebor” references a location in JRR Tolkien’s The Hobbit.

Approval Granted

On Wednesday, the Office of the Comptroller of the Currency (OCC) gave Erebor “preliminary and conditional” approval to operate as a national bank – the first new bank to receive such approval under the current OCC leadership.

OCC Chief Jonathan Gould stated the decision demonstrates that the agency “does not impose blanket barriers” to banks engaging in digital asset activities, as long as they are conducted safely and legally.

Planned Services

Erebor will offer traditional and digital banking services, targeting tech firms and high-net-worth individuals active in virtual currency. The bank plans to operate entirely online, marketing through a mobile app and website, with offices in Columbus, Ohio, and New York. Its leadership team includes former executives from traditional banking and crypto sectors. Founders Luckey and Lonsdale will not be involved in daily operations.

Reactions and Political Ties

Erebor’s founders and early investors include Peter Thiel’s venture firm, Founders Fund, along with prominent donors to Trump’s 2024 presidential campaign. A fundraising memo previously claimed political connections would help secure regulatory approval, though Erebor has denied using those connections in the process.

Senator Elizabeth Warren (D-MA) criticized the approval, calling Erebor a “risky venture” and warning it could lead to taxpayer-funded bailouts. Erebor must meet additional regulatory conditions before launching full operations, expected later this year.