United States (Brussels Morning Newspaper) – US regulators have conditionally approved the launch of Erebor Bank, backed by billionaire tech entrepreneurs Palmer Luckey, Peter Thiel, and Joe Lonsdale, all known supporters of President Donald Trump. Erebor Bank aims to specialise in cryptocurrency and tech financial products under the newly enacted GENI Act regulatory framework.
Conditional approval for Erebor Bank signals innovation in US banking
The Office of the Comptroller of the Currency (OCC), an independent bureau within the US Treasury Department, announced on October 15, 2025, its conditional approval of Erebor Bank’s national charter application. The Columbus, Ohio-based bank will operate nationwide once fully authorised.
Erebor Bank was co-founded by Palmer Luckey, known for co-founding defense technology company Anduril Industries and as a major donor to Donald Trump’s presidential campaigns. Other prominent backers include venture capitalist Joe Lonsdale, CEO of 8VC and co-founder of data analytics giant Palantir Technologies, and billionaire Peter Thiel, an early Trump supporter and influential tech investor.
Erebor Bank’s Focus and Services
According to the bank’s charter application, Erebor Bank intends to offer financial services tailored to technology companies and individuals involved in stablecoins, cryptocurrencies, and tokenized financial products. Services include credit issuance, treasury management, payment processing, and credit card issuance, with strong regulatory compliance commitment.
The bank’s mission statement declares a goal to be “the most regulated participant in stablecoin transactions,” integrating digital assets fully into federally supervised banking frameworks.
Regulatory Context: The GENI Act
The bank’s approval follows the landmark “GENI Act” (General and National Innovation in U.S Stablecoins), signed by President Trump in July 2025. The law establishes the first major federal regulatory regime for stablecoins and crypto assets linked to the US dollar, requiring issuers to be federally chartered banks with high reserve requirements, robust audit mandates, and compliance with anti-money laundering laws.
Erebor Bank is the first new bank to receive preliminary conditional approval since the OCC’s current leadership took office, reflecting the agency’s commitment to facilitating innovative banking ventures while maintaining a strong regulatory perimeter around digital assets.
Political Ties and Controversy
Newsweek reporter Anna Mitchell noted Senator Elizabeth Warren’s sharp criticism of the approval, cautioning that the bank primarily serves “the financial whims of Silicon Valley billionaires” closely aligned with President Trump. Warren accused the OCC of fast-tracking approval for Trump’s allies at the potential risk of taxpayer bailouts and destabilising traditional banking.
Warren stated:
“In a free market, credit flows fairly to those able to use money productively, not to the president’s cronies because of political connections. This rushed approval could lead us to another financial crisis”.
The Role of Key Founders
Palmer Luckey, director and principal shareholder of Erebor Bank, provides the connection to defence and technology sectors as well as Trump’s fundraising base. Luckey’s backing of Trump’s 2024 campaign deepened their ties. Venture capitalist Joe Lonsdale brings expertise in AI and big data, while Peter Thiel’s involvement is seen as a strategic asset given his political influence and investments across multiple sectors.
Financial Innovation and Market Impact
Erebor Bank aims to carve out a niche as the federally regulated bank of choice for fast-growing tech firms focused on crypto and artificial intelligence applications. By operating within new federal regulatory standards for stablecoins, Erebor could push digital currencies closer to mainstream financial systems.
OCC Comptroller Michael Alt remarked:
“This decision marks a significant milestone in supporting dynamic, innovative banking. Legitimate digital asset activities have a place in the federal banking system when conducted responsibly”.
