Erebor Bank targets US$8B valuation

• Erebor Bank is reportedly seeking a funding round that could value the digital lender at more than US$8 billion.
• Customer deposits have increased from US$1.1 billion to more than US$4 billion since March, supported by nearly 400 new customers.
• The bank said its crypto-focused strategy and national bank charter position it to expand services for technology and digital asset companies.

Erebor Bank is reportedly seeking a new funding round that could value the digital lender at more than US$8 billion after customer deposits increased from US$1.1 billion at the end of March to more than US$4 billion.

According to Bloomberg, the bank has added nearly 400 customers during the same period, with founder Palmer Luckey saying the deposit growth came from hundreds of new clients rather than companies he controls.

“The recent increase in deposits has come from hundreds of new customers,” said Erebor founder Palmer Luckey.

The bank focuses on cryptocurrency, artificial intelligence, defence technology and industrial companies, offering blockchain-enabled payments, crypto-backed lending and project financing, while the reported funding round remains under discussion with no final terms announced.

Erebor said its recent growth supports its expansion strategy, and following the report there was no direct market reaction.

The fundraising discussions follow the Office of the Comptroller of the Currency's preliminary conditional approval of Erebor's national bank charter, allowing the lender to expand under a federal banking framework and provide services to cryptocurrency and technology businesses.

Backed by investors including Andreessen Horowitz, Founders Fund and Lux Capital, Erebor has positioned itself to serve sectors that have faced reduced access to banking services since the collapse of Silicon Valley Bank.