On October 15, 2025, the U.S. banking landscape was shaken by a decision that has already sparked fierce debate on Capitol Hill and in Silicon Valley alike. The Office of the Comptroller of the Currency (OCC) granted conditional approval for Erebor, a brand-new bank founded by a constellation of tech billionaires and political donors with close ties to former President Donald Trump. The move marks a significant moment in the ongoing intersection of technology, finance, and politics in America.
Erebor, based in Columbus, Ohio, is the brainchild of Palmer Luckey—best known for founding Oculus VR and the defense tech powerhouse Anduril Industries—and Joe Lonsdale, venture capitalist and co-founder of the data analytics giant Palantir Technologies. According to Bloomberg and the Financial Times, both Luckey and Lonsdale played prominent roles in the 2024 presidential campaign as major contributors to Trump, a fact that has not gone unnoticed by critics and supporters alike.
The bank’s mission is clear: serve the so-called “innovation economy,” targeting emerging technology firms in high-growth sectors such as cryptocurrency, digital assets, artificial intelligence, defense, and advanced manufacturing. In its charter application, Erebor’s founders stated, “The target market for the bank comprises businesses that are part of the innovation economy.” The application further outlined ambitions to provide specialized banking services to companies that have often struggled to find traditional financial partners willing to engage with their sometimes controversial or experimental business models.
Backing Erebor are some of the most influential names in venture capital, including Peter Thiel’s Founders Fund and Haun Ventures. Thiel, a billionaire entrepreneur and political donor, is widely known for his support of disruptive technologies—and for his close alliance with the Trump administration during its tenure. According to Reuters, the involvement of such high-profile investors has only heightened the scrutiny surrounding the OCC’s decision.
Comptroller of the Currency Jonathan Gould, who leads the OCC, was quick to defend the agency’s move. In a statement, he emphasized that Erebor is the first de novo bank to receive conditional approval since he took office. “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 said. “Permissible digital asset activities, like any other legally permissible banking activity, have a place in the federal banking system if conducted in a safe and sound manner.”
This stance reflects a broader shift in regulatory attitudes toward digital assets and financial innovation. In recent years, the OCC has faced mounting pressure from both industry and lawmakers to clarify its position on cryptocurrencies and related technologies. Gould’s comments suggest a willingness to embrace change—at least within certain guardrails. He also made clear that Erebor’s approval is only conditional; final authorization will not be granted until the bank meets a series of pre-opening requirements designed to ensure financial stability and regulatory compliance.
Yet for some, the OCC’s move smacks of favoritism and political expediency. Senator Elizabeth Warren, the influential Massachusetts Democrat and ranking member of the Senate Committee on Banking, Housing, and Urban Affairs, released a blistering statement in response to the news. “President Trump’s billionaire buddies Peter Thiel and Palmer Luckey just received approval from the OCC to launch a new bank that will cater to the financial whims of Silicon Valley billionaires,” Warren said. “In a free market, credit flows fairly to businesses because they can use the money productively, not to the President’s cronies because of their political connections. Trump’s financial regulators just fast-tracked an approval of this risky venture that could set up another bailout funded by American taxpayers and destabilize our banking system.”
Warren’s concerns echo longstanding anxieties about the cozy relationship between political power and financial privilege in Washington. The senator’s warning that Erebor could “set up another bailout funded by American taxpayers and destabilize our banking system” taps into memories of the 2008 financial crisis, during which risky banking practices led to massive government interventions and public outrage. By framing Erebor’s approval as a potential repeat of past mistakes, Warren is positioning herself—and her party—as guardians of financial stability and fairness.
But Erebor’s supporters insist that the process was aboveboard and that the new bank’s focus on innovation is both timely and necessary. A source close to the bank told the Financial Times that there was “no special treatment” in the approval process for Erebor and that Luckey did not involve his contacts in government in the application. For many in the tech sector, the creation of Erebor represents a long-overdue recognition that the needs of high-growth, high-risk industries are not being met by traditional financial institutions, which often shy away from digital asset firms and defense startups due to regulatory uncertainty or reputational risk.
Indeed, the conditional approval comes at a time when the U.S. is vying to maintain its leadership in global technology and finance. As more startups and established players move into the realms of artificial intelligence, blockchain, and advanced manufacturing, access to tailored banking services is becoming a critical competitive advantage. Erebor’s promise to fill that gap—if it can successfully navigate the final regulatory hurdles—could reshape the financial services landscape for the innovation economy.
Still, the optics of the approval are hard to ignore. With both Luckey and Lonsdale having donated to Trump’s 2024 campaign, and with Peter Thiel’s Founders Fund providing early backing, critics worry about the appearance of a revolving door between political influence and financial opportunity. The fact that Erebor is the first de novo bank to gain conditional approval under Comptroller Gould only adds fuel to the fire for those who see the move as part of a broader trend toward deregulation and cronyism.
While Erebor’s founders and backers are bullish about the bank’s prospects, the road ahead is far from certain. The OCC’s conditional approval means that Erebor must still meet stringent pre-opening requirements, and any missteps could delay or derail its launch. Meanwhile, lawmakers like Senator Warren appear poised to keep the pressure on regulators, ensuring that Erebor’s every move is subject to intense public scrutiny.
For now, Erebor stands as both a symbol of the promise and peril of financial innovation in the 21st century. Whether it will usher in a new era of banking for the tech economy—or become a cautionary tale of political favoritism—remains to be seen. But one thing is clear: the intersection of money, technology, and politics is as contentious as ever, and the story of Erebor is only just beginning.
