Erebor Bank Opens as First Trump-Era Charter, Targets Crypto and AI Startups Left by SVB Collapse

A new federally chartered bank opened for business last Sunday with an explicit mission to serve the high-risk sectors that traditional banks have increasingly avoided—and it carries the fingerprints of some of Donald Trump's closest allies.

Erebor, named after the fictional mountain fortress in "The Lord of the Rings," received approval from the Office of the Comptroller of the Currency after submitting its charter application in June 2025. The bank officially began operations on February 8th, making it the first de novo bank approved during Trump's second term and arriving at a moment when finance chiefs at crypto firms, AI startups, and defense contractors have struggled to maintain basic banking relationships.

The timing is hardly coincidental. Erebor's business model centers on filling the void left by Silicon Valley Bank's spectacular failure in March 2023, which left thousands of startups and venture-backed companies scrambling for banking partners. But where SVB focused broadly on the innovation economy, Erebor is making a more pointed bet: it will serve high-net-worth individuals, businesses, and startups specifically in AI, manufacturing, defense, and crypto, along with payment service providers, investment funds, and trading firms.

The bank's connections to the current administration are notable. Palmer Luckey, founder of defense technology contractor Anduril Industries and a prominent Trump supporter, is among those with ties to the institution, according to Fintech Business Weekly, which first reported the bank's opening. (The publication noted "numerous links to well-connected people in the administration's orbit" but did not detail the full extent of those relationships.)

For CFOs in the crypto and fintech sectors, Erebor's launch comes during a week of whiplash. Just days before the bank opened, a service called UnCash—which had operated crypto debit cards with minimal know-your-customer requirements—abruptly shut down after what it described as coordinated termination by its card issuers. UnCash blamed Mastercard directly, saying in a statement that "90% of our cards ran on the Mastercard network" and calling the shutdown "a clean, corporate guillotine" and "a death sentence."

The contrast is striking: as one player in crypto banking collapses under regulatory pressure, another opens with explicit federal approval to serve many of the same customers. UnCash had promised users refunds and the ability to withdraw funds to external crypto wallets, but its sudden closure underscores the persistent compliance challenges facing crypto-adjacent financial services.

The question for finance leaders is whether Erebor represents a genuine regulatory shift or simply a better-capitalized attempt to serve sectors that remain fundamentally difficult to bank. The OCC's willingness to approve a de novo charter with this specific focus suggests at least some appetite within the current administration to provide regulated banking infrastructure for industries that have operated in a gray zone.

What remains unclear is how Erebor will balance the compliance requirements that sank UnCash with the "move fast" expectations of its target clientele. The bank's literary namesake—a fortress reclaimed from a dragon—may prove more apt than intended. The real test will be whether Erebor can hold the mountain, or whether it faces the same regulatory siege that has claimed so many others.