Erebor, the Peter Thiel-Backed Digital Bank, Secures $350M with a $4.35B Valuation

Erebor, a digital bank co-founded by Palmer Luckey and backed by Peter Thiel, has successfully raised $350 million, achieving a valuation of $4.35 billion. The investment round saw participation from Lux Capital and other notable investors such as Founders Fund, 8VC, and Haun Ventures. This funding comes at a pivotal time as Erebor moves closer to accepting deposits in a landscape shaped by recent banking crises.

Key Takeaways

Erebor has raised $350M, reaching a $4.35B valuation.
The investment round was led by Lux Capital and included several prominent investors.
Erebor has received preliminary approval for a national bank charter from regulators.
The bank focuses on digital assets and stablecoins, attracting investor interest.
Expected launch is in 2026, pending final regulatory approvals.

Erebor

Erebor Advances Toward Launch with Regulatory Support

On October 15, the Office of the Comptroller of the Currency granted Erebor preliminary conditional approval for its national bank charter, which is a crucial step for banks looking to engage in digital asset-related activities safely. Comptroller Jonathan V. Gould noted that this decision indicates the OCC does not place overarching restrictions on banks wishing to participate in the digital asset sector.

In December, the Federal Deposit Insurance Corporation (FDIC) approved Erebor’s application for deposit insurance under specific conditions. This includes capital requirements and limitations on management and ownership changes before the bank can officially open. The FDIC requires Erebor to maintain at least $276 million in initial capital and achieve a tier 1 leverage ratio of no less than 12% for its first three years.

Growing Investor Interest in Stablecoins

Erebor has branded itself as a technology and digital asset-driven bank. Its FDIC approval included a capital call agreement, allowing investors to contribute additional funds based on specific financial triggers. Axios highlighted that there is considerable investor interest in the bank's focus on stablecoin operations. The substantial increase in Erebor's valuation indicates that investors believe in the potential for a regulated banking institution that can cater to clients involved in crypto and emerging technologies, particularly given the limited number of current options.

While Erebor has not announced an official launch date, industry reports suggest that the bank could open its doors in 2026, provided it meets the necessary regulatory approvals and requirements leading up to its opening.