U.S. regulators gave conditional approval to a new bank that has ties to Silicon Valley allies of President Donald Trump.
The Office of the Comptroller of the Currency granted the conditional approval for the bank’s charter to Erebor Bank on Wednesday. The bank’s founders are well-connected in the tech world and will target businesses in the “innovation economy,” such as firms involved in cryptocurrency.
Palmer Luckey, the founder of Oculus VR and defense technology company Anduril Industries, and Joe Lonsdale, a venture capitalist and cofounder of Palantir Technologies, submitted a charter application for Erebor Bank in June.
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Comptroller of the Currency Jonathan Gould pointed out in a statement that Erebor is the first de novo bank to be granted conditional approval since he arrived at the OCC and said that the decision is the first step in a commitment to a “dynamic and diverse federal banking system.”
“Today’s decision is also proof that the OCC under my leadership does not impose blanket barriers to banks that want to engage in digital asset activities,” Gould said. “Permissible digital asset activities, like any other legally permissible banking activity, have a place in the federal banking system if conducted in a safe and sound manner.”
Both Luckey and Lonsdale donated to Trump in 2024. A source close to the bank told the Financial Times that there was “no special treatment” in the approval process for Erebor and that Luckey didn’t involve his contacts in government in the process.
Early backers of the bank include Peter Thiel’s venture firm Founders Fund and venture capital firm Haun Ventures.
“The target market for the bank comprises businesses that are part of the innovation economy,” the charter application reads. That includes tech companies focused on digital assets, artificial intelligence, defense, manufacturing, and more, according to the application.
The bank was already facing pushback from Sen. Elizabeth Warren (D-MA), the ranking member of the Senate Banking Committee. She asserted that the bank would “cater to the financial whims of Silicon Valley billionaires.”
“In a free market, credit flows fairly to businesses because they can use the money productively, not to the president’s cronies because of their political connections,” Warren said. “Trump’s financial regulators just fast-tracked an approval of this risky venture that could set up another bailout funded by American taxpayers and destabilize our banking system.”
Final approval and authorization for the new national bank to open won’t be granted until certain pre-opening requirements are met.
