Palmer Luckey, founder of Anduril, is launching a crypto-focused digital bank called Erebor. According to a fundraising memo, he expects to obtain regulatory approval within six months of his June application. However, experts doubt such a quick process. He has also applied for deposit insurance with the FDIC.
Mission: to fill the gap left by the collapse of Silicon Valley Bank in 2023 by offering financial services to startups in crypto, AI, defense, and manufacturing.
Will operate exclusively online, with a main office in Columbus, Ohio, and a location in New York.
Innovation in crypto assets
Plans to hold stablecoins on its balance sheet, positioning itself as the most regulated entity in stablecoin transactions, which distinguishes it within the traditional banking system.
Management team
Co-CEOs: Owen Rapaport (former Aer Compliance) and Jacob Hirshman (former advisor at Circle).
Presided over by Mike Hagedorn, a veteran of traditional banking. It also has a team of executives in finance, risk, and credit, all with experience in banking, fintech, and regulation.
Funding and valuation
Is raising at least USD 225 million, with a projected valuation close to USD 2 billion, backed by Founders Fund and 8VC.
Regulation and timeline
According to a fundraising memo, they expect to obtain the banking charter from the OCC within 6 months after their application in June, thanks to the political network close to Luckey and allies like Jonathan Gould. However, experts estimate that full approval could take between 9 months to over a year. They also applied for deposit insurance with the FDIC on July 28, a process that typically takes about 10 months.
Strategic implications
Erebor seeks to offer credit and financial services to businesses that traditional banking systems tend to avoid. This includes access to stablecoins and agile credit for innovative crypto startups.
Its digital-first model, focus on digital assets, and strong regulatory backing could make it a key bridge between traditional finance and the crypto sector.
