Federal regulators have granted preliminary approval to Erebor Bank, the crypto- and tech-focused financial outfit cofounded by Palmer Luckey and backed by Peter Thiel and Joe Lonsdale.
“I am committed to a dynamic and diverse federal banking system, and our decision today is a first but important step in living up to that commitment,” Jonathan Gould, the Comptroller of the Currency, said on Wednesday.
The green light is a necessary step toward opening. Erebor is the first bank to receive such approval since Gould was sworn in in July.
Luckey, who also co-founded autonomous weapons manufacturer Anduril Industries, helped start Erebor earlier this year. Thiel’s Founders Fund and Lonsdale’s 8VC have invested in the startup, valuing it at at least $2 billion, Business Insider reported in July.
A lawyer for Erebor didn’t immediately respond to a request for comment.
Before it can open, Erebor needs approval from the Federal Deposit Insurance Corporation; it applied for that in July. The median processing time for those applications is about nine and a half months. After that, the Office of the Comptroller of the Currency may grant final approval.
A fundraising memo for Erebor circulated earlier this year to prospective investors said the bank anticipated federal banking regulators would grant final approval for its plans “less than six months” after it submitted its application in June — a speedy timeline the bank said was possible because of Luckey’s political ins, Business Insider previously reported.
“Palmer’s political network will get this done,” the memo said. The memo also advertised an Erebor cofounder’s “unique connectivity to banking regulators” including Gould.
Adam Cohen, a lawyer for the firm Skadden who worked with Erebor on its OCC application, left the firm in August and joined the OCC as Gould’s chief counsel.
Luckey contributed over $1 million to politicians and political committees in 2024, mostly Republican-linked, according to federal records.
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Erebor has told prospective investors that it plans to make money by lending against crypto and other assets that other banks might struggle to value, like graphics processing units that are key for training artificial intelligence models.
“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’s statement said. “The OCC will continue to provide a path for innovative approaches to financial services to ensure a strong, diverse financial system that remains relevant over time.”
Gould was previously a senior official in the OCC during President Donald Trump’s first administration and briefly worked as chief legal officer at Bitfury, a bitcoin mining company.
The conditional approval letter lists several bank executives and directors whose names Business Insider reported in July.
It also included new names. Diogo Mónica, a cofounder of the crypto financial institution Anchorage Digital, and Michael Mosier, a tech-industry lawyer and former prosecutor, are listed as independent directors. Neither responded to a request for comment.
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