Erebor Bank in talks for $8 billion valuation

Erebor Bank, a digital lender focused on cryptocurrency and technology sectors, is in preliminary talks to raise a new funding round that could value the company at $8 billion or more. The potential valuation would nearly double the $4.35 billion the bank achieved in a funding round last December. The discussions, reported by Bloomberg, come as the bank has seen its customer deposits surge from $1.1 billion at the end of March to over $4 billion, adding nearly 400 new clients in that three-month period.

Founder Palmer Luckey, who created Oculus, emphasized that the recent deposit growth is organic, coming from hundreds of new customers independent of companies he controls. The bank projects it will reach profitability before the end of the year. Backed by prominent Silicon Valley investors including Andreessen Horowitz, Peter Thiel’s Founders Fund, and Lux Capital, Erebor has positioned itself to serve defense technology, artificial intelligence infrastructure, hard tech, and crypto firms. Its services include blockchain-enabled payments, crypto-backed lending, and financing for industrial projects.

A key factor in Erebor's rapid growth is its strengthened regulatory standing....