New Bank to Serve Crypto, AI Startups Post-SVB Collapse

A group of prominent Silicon Valley investors, including Palmer Luckey (Anduril) and Joe Lonsdale (Palantir, 8VC), is backing a new bank called Erebor. Adam Willems reports in Wired that the bank aims to serve high-risk, high-tech startups in crypto, AI, and defense.

Erebor is being positioned as a successor to fill the financing void for frontier tech industries following the collapse of Silicon Valley Bank in 2023.

Erebor has filed a national charter application with the Office of the Comptroller of the Currency (OCC). It plans to raise over $250 million and target wealthy clients in emerging tech and foreign banks handling dollar transactions, as well as startups.

The formation of Erebor comes amid a regulatory shift under the Trump administration that has relaxed constraints on stablecoins and is accelerating bank charter approvals.

The OCC has signaled openness to new applicants, including crypto-focused firms, and recent reversals of Biden-era restrictions have made the landscape more favorable for banks aiming to integrate stablecoin technologies.

Erebor plans to capitalize on this climate by becoming the most regulated stablecoin facilitator and enabling crypto-backed loans, in line with the political and regulatory leanings of its backers.

Erebor’s leadership includes veterans from the crypto, banking, and regulatory spheres. Although its major investors are not listed in regulatory filings, their influence is seen in Erebor’s strategic ambitions.

Erebor’s ability to scale will depend on gaining client trust, managing risk across volatile sectors, and navigating increased regulatory scrutiny, particularly given its concentrated client base.

For attorneys, Erebor offers a case study on how political alignment and regulatory changes foster aggressive experimentation in fintech. Be alert for potential legal challenges to the bank’s charter, including those based on client concentration, investor influence, and compliance with the Bank Holding Company Act.

How Erebor fares will help define the boundaries of crypto-integrated banking under deregulated conditions.