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A group of tech billionaires led by Palmer Luckey, co-founder of military contractor Anduril, are launching a U.S. bank named Erebor to serve startups, including Bitcoin and other crypto businesses, according to a Financial Times report.

The bank would be backed by tech investors including the Founder of Venture Capital Firm 8VC Joe Lonsdale, and the co-founder of Defence Group Palantir Peter Thiel’s, according to people familiar with the matter.

Erebor will be run by the CEO of Aer Compliance Owen Rapaport and co-CEOs Jacob Hirshman, who previously worked as an adviser at Circle, and the co-founder. The senior executive vice-president at New Jersey-based Valley National Bank Mike Hagedorn will serve as president.

“The bank will be a national bank… providing traditional banking products, as well as virtual currency-related products and services, for businesses and individuals,” according to the report.

Erebor’s target market would be companies in the U.S. innovation economy, such as those in digital currencies, artificial intelligence (AI), defence and manufacturing. It will also serve individuals who work for or invest in those companies, and non-U.S. businesses seeking access to the U.S. banking system.

The bank founders aim to cover the gap that Silicon Valley Bank (SVB) left serving crypto businesses after it failed in March, 2023. Since then, many Bitcoin and crypto startups have struggled to get the same access to capital from traditional banks.

Erebor said in the filing it would “differentiate itself” by working with customers that “are not well served by traditional or disruptive financial institutions, in particular with respect to insufficient access to credit.”

The bank will also be focused on stablecoins, digital assets pegged to real-life assets like the U.S. dollar, according to the report. Erebor aims to become “the most regulated entity conducting and facilitating stablecoin transactions.” 

Erebor will be headquartered in Columbus, Ohio, with an additional office in New York City. Erebor plans to offer all of its services through digital-only customer service.

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