With OCC Approval, Billionaire-Backed Erebor Sets Sights on Tech Sector

U.S. regulators have granted preliminary and conditional approval for Erebor, a new national bank founded this year by technologists Palmer Luckey and Joe Lonsdale in a move pitched as filling the void left by Silicon Valley Bank’s 2023 collapse, the Financial Times reported.

The Office of the Comptroller of the Currency (OCC) cleared Erebor to proceed just four months after its June charter application. Comptroller Jonathan Gould said it is the first new bank to receive such approval since he took office and signaled the agency would not impose “blanket barriers” on institutions that plan to engage in digital-asset activities, the FT said.

The financial institution, which has been bankrolled in part by Peter Thiel’s Founders Fund and the crypto-focused Haun Ventures, must still satisfy further compliance, cybersecurity and operational checks before opening, a process expected to take several months, according to the news outlet.

Erebor, named after the treasure-laden mountain in The Hobbit, aims to serve companies in the US “innovation economy,” with an emphasis on cryptocurrency, artificial intelligence, defense, and manufacturing firms, as well as their founders, employees and investors, the newspaper said.

The startup plans a digital-only model with headquarters in Columbus, Ohio, and an office in New York. Stablecoins—crypto tokens tied to fiat currencies—are expected to be a significant product line after the Trump administration rolled back rules that had limited banks’ stablecoin activities.

A person close to Erebor who spoke with the FT emphasized it had adopted a conservative business plan and would not be “a wacky, techno crypto bank.”

The rapid approval drew political scrutiny given the founders’ support for Donald Trump in 2024 and the involvement of prominent MAGA allies, including Thiel. Adam Cohen, the Skadden partner who filed Erebor’s application, recently left the law firm to become chief counsel to U.S. Comptroller Jonathan Gould, the Financial Times said.

In a statement issued following the OCC announcement, Sen. Elizabeth Warren, the top Democrat on the Senate Banking Committee, condemned the approval as a “risky venture that could set up another bailout,” arguing credit should not flow because of “political connections.”