Author: BitpushNews
The collapse of Silicon Valley Bank (SVB) in 2023 brought significant shock to the tech finance industry and left a service gap that urgently needs to be filled. Now, a new battle to reshape the financial landscape is quietly beginning.
According to the latest news from the Financial Times, a new 'crypto bank' named Erebor is being prepared under the joint promotion of Joe Lonsdale, a staunch ally of President Trump and a tech billionaire, along with Palmer Luckey, the founder of Oculus VR, and Peter Thiel, co-founder of PayPal.
Peter Thiel (right), Palmer Luckey (middle), and Joe Lonsdale (left)
The name Erebor comes from the 'Lonely Mountain' in The Hobbit, which is rich in treasures, symbolizing the bank's grand goal: to seek 'treasure-like' financial services for emerging technology in the 'desert' of traditional finance.
It is reported that Erebor not only aims at the service gap left by SVB for technology companies, but also takes stablecoins as its core strategy. Its goal is to become the 'most regulated entity for conducting and promoting stablecoin transactions,' indicating that the integration of traditional finance and cryptocurrency will enter a new stage.
The 'unhealed pain' of SVB's collapse: high-tech companies urgently seeking new 'support'.
Silicon Valley Bank (SVB) was once the 'go-to bank' for American tech startups and the venture capital world, providing services to countless startups that were considered 'high-risk' by traditional large banks. From deposits, loans to investment banking services, it covered almost every stage of technology company growth. It was deeply tied to Silicon Valley's startup ecosystem, becoming an important financial partner for many innovative companies from incubation to listing.
However, excessive focus on technology industry clients, significant unrealized losses due to misjudgment of the Federal Reserve's interest rate hike cycle, and the speed and scale of bank runs in the social media era ultimately triggered a liquidity crisis in March 2023.
Although the US government quickly intervened afterwards, protecting depositors through emergency measures, traditional large banks have generally maintained a cautious attitude towards technology, especially high-risk startups in the cryptocurrency and AI sectors, following the collapse of SVB. This has led to a noticeable financial services 'vacuum,' making it urgent to find a new 'pillar' that understands and supports their development.
'Lonely Mountain' Bank Erebor: The ambitions of the giants.
Erebor may therefore come into being, with a list of founders that is truly luxurious:
Palmer Luckey: The legendary founder of virtual reality (VR) headset company Oculus VR, he sold Oculus VR to Facebook (now Meta) for a high price of $2 billion, becoming a pioneer in the VR field. Palmer Luckey later transitioned to defense technology and co-founded Anduril Industries in 2017, a company focused on providing advanced AI-driven unmanned systems, sensors, and surveillance technology to the US and its allies. Anduril quickly rose to prominence in the defense tech field with its rapid iteration and disruption of traditional military industrial giants.
Peter Thiel: A legendary figure in Silicon Valley, wearing multiple hats: co-founder of PayPal, spiritual leader of the 'PayPal Mafia,' co-founder of big data company Palantir, early investor in Facebook, and leader of the well-known venture capital firm Founders Fund.
Peter Thiel is known for his unique libertarian and contrarian thinking. He has invested in many world-changing companies, such as SpaceX and Airbnb, and has an unusual obsession with 'disruptive innovation,' also being a supporter of cryptocurrency.
Joe Lonsdale: Co-founder of Palantir and political activist. Joe Lonsdale is a protégé of Peter Thiel and one of the co-founders of Palantir. After leaving Palantir, he founded another well-known venture capital firm, 8VC, and invested in many emerging tech companies. Like Thiel, Lonsdale is also politically active and is one of the major donors to former President Trump's 2024 campaign.
This special political background undoubtedly adds strategic imagination for the future of Erebor. During Trump's second term, the regulatory environment in the US has embraced cryptocurrency, and Erebor's high-profile entry at this time may be precisely targeting this 'policy dividend window,' attempting to seize opportunities under the new regulatory framework.
Aiming to be the 'most regulated' stablecoin bank
According to its national banking license application, Erebor Bank will be headquartered in Columbus, Ohio, and will establish a secondary office in New York, adopting a digital-first operating model. It explicitly states that it will serve emerging technology companies in areas such as artificial intelligence, cryptocurrency, defense, and manufacturing, as well as investors and employees in these fields. This vertical segmentation and highly specialized market positioning is the key to Erebor's distinction from traditional banks.
Erebor's core strategy also lies in its deep embrace of stablecoins and its vision for compliance.
It is reported that Erebor plans to incorporate stablecoins into its balance sheet. Stablecoins, as a type of cryptocurrency pegged to fiat currencies like the US dollar, are increasingly becoming a key tool for accelerating cross-border payments, simplifying settlements, and expanding the accessibility of digital financial services due to their stability, high transaction efficiency, and low costs. Previously, fintech companies and traditional financial institutions had begun to experiment with stablecoins for cross-border settlements, while Erebor has elevated this to a strategic height of core banking operations.
One of Erebor's co-CEOs, Jacob Hirshman, previously served as an advisor to the well-known stablecoin company Circle. As the main issuer of the US dollar stablecoin USDC, Circle's compliance framework has always been an important channel for traditional financial institutions to enter the crypto world. Hirshman will replicate a similar path at Erebor, building it into 'the most regulated entity for stablecoin transaction execution and promotion.'
Through this strategy, Erebor not only hopes to become the 'new money bags' in Silicon Valley and the emerging tech field but also aims to be the 'official bridge' connecting the US dollar and digital dollar. It could change the traditional ways companies conduct cross-border transactions and manage digital assets, allowing stablecoins to truly enter mainstream finance. Previously, the SEC's corporate finance division released new guidelines for crypto ETP disclosures, which indirectly confirmed that regulators are actively preparing for the integration of digital assets into the traditional financial system, aligning with Erebor's compliance path.
The ambition of Silicon Valley's new 'money bags': who will benefit and who will be under pressure?
The entry of Erebor Bank is bound to create ripples in the tech finance field, and its impact will be multidimensional:
For emerging tech companies, the emergence of Erebor comes at the right time. In innovative fields like AI and cryptocurrency, many startups have long faced 'cold treatment' from traditional banks. The customized financial services offered by Erebor precisely address these companies' pain points in financing, operations, and compliance, allowing them to focus more on technological innovation. This is undoubtedly good news for Web3 companies, as such a financial service provider focused on blockchain technology is a positive development.
For the entire crypto industry, Erebor may become an important compliance benchmark. If it can successfully operate stablecoin business under a strict regulatory framework, it will greatly advance the process of digital assets being accepted by mainstream markets. This may attract more traditional institutional capital into the crypto field.
For traditional banking, the emergence of Erebor is a signal worth paying attention to. This emerging digital bank, with precise positioning and professional background, is competing for the most promising technology customer base. In the face of such competitors, traditional banks may need to accelerate their pace of innovation and reassess their attitudes towards emerging technologies. In the future, we are likely to see more traditional banks begin to transform or choose to collaborate with professional digital financial service providers.
In summary, competition in the crypto world increasingly resembles a game of giants—Silicon Valley capital and Wall Street old money are entering the fray, and now Erebor has joined the competition. Whether this company named 'Lonely Mountain' can find its own 'Arkenstone' may become one of the most noteworthy stories in the coming years.
(The above content is excerpted and reprinted with the authorization of partner PANews, original link | Source: Bitpush)
"The new battle to reshape the financial landscape: Silicon Valley tycoons join forces to create the crypto bank 'Erebor'". This article was first published on (Block客).
