Erebor: A New Bank for Stablecoins, AI, and Defense That Smells Like a Centralized Trap

EDITOR'S NOTES

Here’s the play-by-play: a gaggle of billionaire technocrats—Palmer Luckey, Joe Lonsdale, and Peter Thiel—are conjuring up Erebor, a shiny new “digital bank” to pick up the wreckage of SVB. They say they’re here to save the “innovation economy,” but look closer, and you’ll see the same old scheme: centralized control, regulatory capture, and the pretense of free markets masking cartel power. From the Austrian economics lens, this reeks of interventionism, moral hazard, and the creeping fusion of state and capital. They’re luring you in with promises of stablecoins and frictionless finance—but watch carefully. This is the same technocratic hubris that built the surveillance leviathan of Palantir. Don’t take the bait.

Derek Wolfe Jul 3, 25

A Fortress Built on the Ashes of SVB

A fresh front has opened in the war for control over your money and your data. Peter Thiel—yes, that Peter Thiel—and fellow defense-industrial oligarchs Palmer Luckey and Joe Lonsdale have unveiled their latest contrivance: a national bank called Erebor, named after Tolkien’s mountain of hoarded treasure. Fitting, isn’t it? A fortress of capital guarded by a small elite, now vying to become the de facto gatekeepers of everything from stablecoins to defense technology.

This ambitious gambit was sparked by the engineered implosion of Silicon Valley Bank back in 2023—an event that rattled startups and conveniently paved the way for consolidation by bigger players. Let’s not pretend this was the free market correcting itself. It was the predictable consequence of a fiat-fueled credit bubble, propped up by the Fed’s cheap money and moral hazard, then gutted when reality finally caught up.

A Digital Bank for Surveillance Finance

Enter Erebor, which has formally applied for a national banking charter—another sign that even self-proclaimed libertarian tech moguls can’t resist sucking at the regulatory teat when it suits them. Their pitch is that traditional banks are too timid to bankroll “risky” sectors like AI, blockchain, defense, and advanced manufacturing. Translation: they’re positioning themselves as the central node through which all this venture-backed capital must now flow.

Erebor’s blueprint reads like a technocrat’s wet dream:

A fully digital-only bank—so every transaction, every login, every data point is in their cloud.
“The most regulated entity conducting stablecoin transactions.” This should set off klaxons for any Austrian economist. When you merge regulatory capture with fiat-collateralized digital tokens, you’re not decentralizing anything—you’re just building a shinier, more invasive banking cartel.
A pipeline to military contractors. With Luckey’s Anduril and Lonsdale’s Palantir pedigree, you can bet that “serving defense innovation” really means intertwining finance and the surveillance state more tightly than ever.

Cronyism Disguised as Disruption

Their leadership lineup is a revolving door of crypto compliance operatives and legacy bankers. Jacob Hirshman, ex-Circle adviser; Owen Rapaport, who built a business around making digital assets palatable to regulators; Mike Hagedorn, a banking dinosaur. What unites them isn’t entrepreneurship—it’s proximity to power.

While Erebor masquerades as a savior of startups, notice what they’re keeping in the shadows. Major portions of their application—equity structure, business plans, shareholder identities—are conveniently filed under wraps. For a bank that claims to champion transparency and disruption, that’s rich.

Meanwhile, the entire project reeks of the same interventionist fallacies that Austrian economists have warned about for over a century:

Artificial credit expansion to prop up politically connected sectors.
Regulatory moats to crush true competition.
Moral hazard baked in by the implicit guarantee that, if Erebor stumbles, the state or their crony networks will bail them out—just like SVB.

The Marriage of Big Tech and Big Finance

In a sane system of hard money and free banking, such a scheme would be impossible to sustain. But in our fiat dystopia, the marriage of Big Tech and Big Finance has every incentive to deepen its stranglehold. They want to be your universal bank, your crypto custodian, your defense contractor, and your data broker—all behind a glossy app on your phone.

They call it Erebor. I call it the Technocrat’s Trojan Horse.

Call to Action:
Before you hand over your capital—and your sovereignty—to this shiny new citadel of centralized power, arm yourself with knowledge. Download Seven Steps to Protect Yourself from Bank Failure by Bill Brocius and inoculate yourself against the next engineered collapse:
👉 Download Here