Summary
- Erebor has made history as the first cryptocurrency bank to obtain a conditional federal charter during the Trump administration, and it is only the second bank ever to do so, following Anchorage Digital.
- With backing from Palmer Luckey and the companies of Joe Lonsdale and Peter Thiel, Erebor is expected to gain similar advantages as Anchorage regarding stablecoin issuance in light of the newly enacted GENIUS Act.
- Other significant cryptocurrency entities, including Coinbase, Stripe, and Circle, have also submitted applications for their banking charters in recent months.
A major agency within the Treasury Department approved a conditional bank charter for a cryptocurrency-centric bank for the first time during the Trump administration, a move that may shake up the rapidly expanding stablecoin market.
The Office of the Comptroller of the Currency granted this conditional approval to Erebor, a crypto-focused bank intimately connected to prominent players in Silicon Valley, as well as the Trump administration.
Named after the “Lonely Mountain” from The Lord of the Rings series, Erebor has backing from weapons manufacturer Palmer Luckey along with co-founders of Palantir, Joe Lonsdale and Peter Thiel. Luckey and Lonsdale actively supported Trump in the 2024 campaign, while Thiel has consistently backed Vice President J.D. Vance.
Erebor must meet specific auditing and security protocols in the upcoming months before it can officially commence operations and serve customers.
This conditional approval marks a significant milestone, positioning Erebor as the only crypto bank besides Anchorage Digital to hold a federal charter.
A federal bank charter provides a bank with the ability to operate nationwide, accept deposits, and issue loans, among other privileges. Following the passage of the GENIUS Act, which focuses on stablecoins, this could provide Erebor a crucial advantage in stablecoin issuance, as noted by Anchorage’s CEO, Nathan McCauley.
