Anduril CEO Palmer Luckey's new digital banking startup set to be valued at $2 billion, sources say
Erebor, a digital bank aimed at startups and cryptocurrency companies, which might sound a little like the infamous Silicon Valley Bank, is raising at least $225 million at a $2 billion valuation, according to people familiar with the deal.
Founders Fund, the venture firm run by Palantir cofounder Peter Thiel, and 8VC, led by fellow Palantir cofounder Joe Lonsdale, are investing in the company, the people who weren't authorized to speak publicly on the matter said. The fundraise is ongoing, and details could still change.
8VC, Founders Fund and Palmer Luckey did not respond to requests for comment.
Erebor — like Luckey's Anduril as well as Lonsdale and Thiel's Palantir — takes its name from JRR Tolkien's "The Lord of the Rings." In the book, Erebor is the "Lonely Mountain," a kingdom known for its treasure.
The startup recently applied for a US bank charter that would let it operate as a regulated bank. It plans to provide services such as crypto-collateralized lending to startups and crypto clients, according to documents viewed by Business Insider.
Luckey founded Erebor. Jacob Hirshman, who previously worked at stablecoin issuer Circle, and Owen Rapaport, who cofounded now-acquired crypto-monitoring company Aer Compliance, will lead the bank as co-CEOs, the documents said. Mike Hagedorn, previously senior executive vice president and chief financial officer of Valley National Bank, will be the startup's president, according to his LinkedIn.
Hirshman declined to comment. Rapaport and Hagedorn did not respond to requests for comment.
Luckey is also the CEO of Anduril Industries, a defense tech giant he cofounded in 2017 that raised $2.5 billion at a $30.5 billion valuation in June. He also founded virtual reality company Oculus in 2012 at 19 years old and sold it to Facebook, now Meta Platforms, for $2 billion two years later.
In 2016, Luckey was fired from Meta after donating $10,000 to a pro-Donald Trump meme group. (Meta and CEO Mark Zuckerberg have denied that Luckey left over his politics, and the two teamed up again in May, announcing an Anduril-Meta US military partnership.)
Both Lonsdale and Thiel — who lead the venture firms backing Erebor — have supported President Trump. Thiel contributed over $1 million to pro-Trump super PACs and his 2016 campaign, according to the New York Times. Lonsdale has backed the America PAC, which supported Trump's 2024 reelection campaign, the Financial Times reported.
In the first few months of his second term, Trump made moves to support the crypto industry, like creating a strategic bitcoin reserve and appointing venture capitalist David Sacks as Crypto Czar. And Wall Street interest in crypto is on the rise after Circle's IPO in June. Shares in Circle are up over 113% since its public market debut as of the Wednesday close.
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Time Magazine
6 minutes ago
- Time Magazine
What to Know About ‘Transshipping' and U.S. Trade Deals
A U.S. and Vietnam trade deal has been reached that means Vietnam will avoid the most severe tariff rates—set to go back up next week—but there's a catch that could anger Vietnam's largest trading partner, China. The deal, announced Wednesday, will mean Vietnamese exports to the U.S. are tariffed at a 20% rate—lower than the initial 46% 'reciprocal' tariff announced in April, but double the 10% universal tariff. Goods that are deemed to be transshipped, however, will be tariffed at a 40% rate—a policy that seems aimed at China which has used the method to get around U.S. levies. Transshipping involves transferring cargo from one vessel to another while in transit to the destination country and is often done to disguise a product's country-of-origin in order to illegally skirt import levies. In return, Vietnam agreed to drop all tariffs on U.S. imports, President Donald Trump said. 'In other words, they will 'OPEN THEIR MARKET TO THE UNITED STATES,' meaning that, we will be able to sell our product into Vietnam at ZERO Tariff,' the President posted on Truth Social on Wednesday morning. At the heart of Trump's deal with Vietnam—and his talks with other major trading partners—has been an effort to counter what he sees as China's unfair trade practices. Trump's trade adviser Peter Navarro called Vietnam 'essentially a colony of communist China' in an April interview on Fox News while describing how nontariff barriers, including Chinese transshipments, contribute to U.S. trade deficits. 'Vietnam sells us $15 for every $1 that we sell them and about $5 of that is just Chinese product that comes into Vietnam, they slap a 'Made in Vietnam' label on it and they send it here to evade the tariffs,' he said. The higher tier of tariffs on transshipments will impact goods that have components originating in one country, such as China, but are routed through Vietnam then exported to the U.S. China supplies much of the components and raw materials to Vietnam and other Asian countries that are then used to make finished goods, but it also ships some finished goods through Vietnam or mostly finished goods that go through a minimal final assembly in Vietnam with their county-of-origin misrepresented as Vietnam, which is considered illegal. But restrictions on transshipments could tick off China, which is a larger trading partner for most Asian countries than the U.S. Here's what to know about what the deal means for Vietnam and China. What does the deal mean for Vietnam? Vietnam has been keen to be on Trump's good side since he announced his 'reciprocal' tariffs in April. Vietnam was the sixth-largest importer to the U.S. last year, supplying almost $137 billion worth of goods and fuelling a $124 billion trade surplus with the U.S.—the third largest trade gap with the U.S. after China and Mexico. The country's share of imports to the U.S. was bolstered during Trump's first term, when trade tensions with China pushed firms to move production to Southeast Asia. Vietnamese officials have been in talks with the Trump Administration for weeks and even signed deals to purchase more American goods ahead of Thursday's trade agreement. The country has promised to buy more aircraft, liquefied natural gas, and agricultural products from the U.S. Vietnamese officials have also backed the Trump Organization's plans for a $1.5 billion luxury resort and golf club development outside Hanoi. Vietnam's agreement, according to Trump, to remove all levies on U.S. imports is indicative of the country's push to maintain close trading ties with the U.S., even as Trump has retreated from the relationship in other areas, such as through the shuttering of USAID. Trump boasted that the zero tariffs will drive sales of American SUVs in Vietnam, although an American-made car, even with no duties, may still be more expensive than cars produced elsewhere, and it's not clear how much domestic demand there is for American cars. Vietnam also pledged to crack down on fraud and illegal transshipments even before the deal was cut. Thailand, South Korea and Taiwan have also implemented or stepped up similar measures since April. The U.S.-Vietnam deal, however, does not currently address industry-specific tariffs, including a 25% tariff on cars and auto parts and a 50% tariff on steel and aluminium, that are subject to pending Commerce Department investigations. It could also still dampen Vietnam's economy: Bloomberg Economics estimates that Vietnam could lose a quarter of its exports to the U.S. in the medium term under the deal, affecting more than 2% of its annual economic output. How does China use transshipments? The higher tariff on transshipments indirectly targets Chinese exports. China has routed its goods through other countries, including Vietnam, to bypass U.S. import levies, a practice that became more frequent during the U.S.-China trade war in Trump's first term. Earlier this year, ahead of Trump's tariffs in April, Chinese exports to Vietnam and Thailand rose sharply, which Brookings analysts suggest is unlikely to reflect a rise in domestic demand in those countries and is instead more likely to reflect transshipments to the U.S. Chinese shipments to Southeast Asian rerouting hubs like Vietnam, Malaysia, Indonesia and Thailand, also surged shortly before trade talks between China and the U.S. in May even as direct exports from China to the U.S. fell—suggesting that China was able to continue its flow of goods to the U.S. through transshipments even as countries touted crackdowns. It's too soon to tell how effective the transshipment clause and other measures will be in cracking down on fraud. 'While the exact criteria for defining transshipment remain unclear, it is evident that Vietnam's role as a potential connector for Chinese exports to the U.S. will diminish,' Su Yue, Principal China Economist at the Economist Intelligence Unit, told the South China Morning Post. But some experts say at least some businesses may be willing to take the gamble, especially if the benefit of manufacturing in China outweighs the risk of getting caught. 'The thing about trade is when there are huge arbitrage opportunities, people are going to find a way to take advantage of them, legally or illegally,' Caroline Freund, an expert on international trade at the University of California at San Diego, told the Washington Post in May. 'It's like a river. You can keep putting rocks in, but the water's going to keep flowing down.' Ash Monga, who runs China-based supply chain management company IMEX Sourcing Services, tells TIME that in the wake of Trump's tariffs, he noticed a rise in Chinese companies offering 'Delivered Duty Paid' fraud services to U.S. importers, which involves underpricing goods in order to pay a lower duty. Suppliers in China would set up shell companies that would act as the 'importer of record,' creating the perception among U.S. importers of lower risk. (Monga cautions that U.S. customs can still go after the U.S. businesses purchasing the goods from China and it can carry severe penalties.) 'They are doing it because people are looking for solutions to lower the tariff,' Monga says. 'Businesses were at risk of not surviving so they were desperate to find any solution' even if those solutions are fraudulent. China sees move as attack on interests 'The looming question now is how China will respond,' Bloomberg Economics analyst Rana Sajedi wrote in a research note. 'Beijing has made clear that it would respond to deals that came at the expense of Chinese interests and the decision to agree to a higher tariff on goods deemed to be 'transshipped' through Vietnam may fall in that category.' China vowed that it will retaliate if its interests are hurt by the U.S.-Vietnam trade deal. 'We are happy to see all parties resolve trade conflicts with the U.S. through equal negotiations but firmly oppose any party striking a deal at the expense of China's interests,' Chinese Commerce Ministry spokesperson He Yongqian said at a Thursday press conference, reiterating earlier comments warning countries against signing deals with the U.S. that shut out China. 'If such a situation arises, China will firmly strike back to protect its own legitimate rights and interests.' On top of that, China will likely view the relatively lower 20% tariff on Vietnamese goods as an effort to encourage firms to produce their goods in Vietnam over China. The U.S. and China said they reached a framework agreement in June that will set U.S. tariffs on Chinese imports at 55% and Chinese tariffs on U.S. imports at 10%, alongside other export controls. 'The 'China quotient' in U.S. negotiations with other Asian economies is arguably evident in the deal with Vietnam,' Vishnu Varathan, macro research head for Asia at Mizuho, wrote in a Thursday note. 'The U.S.'s intent is quite obviously to not disincentivize Vietnam's role as a substitute for China at a lower 20% tariff.' Vietnam may soon find itself caught in a balancing act between two economic superpowers. Varathan wrote: 'Other Asian economies will be particularly vulnerable to a two-sided geoeconomic squeeze given that their reliance on both China and U.S. are significant.' And some experts suggest that the U.S. wants to go beyond stopping illegal transshipments—it wants to shut China out of global supply chains entirely. The U.S. has also been in talks with India that could involve an agreement requiring a higher minimum amount of a product's value to be added locally in order to qualify as 'Made in India'—the U.S. is asking for that amount to be 60%, while India wants to bring it down to around 35%. The U.K. also signed a trade deal with the U.S. in June that included commitments around export controls that could encourage British firms to exclude Chinese products from their supply chains. China's foreign ministry criticized the move, telling the Financial Times: 'Co-operation between states should not be conducted against or to the detriment of the interests of third parties.' 'The United States seems to be arguing that anything that comes from China is by default transshipment, so you tar and feather every single product that comes from China,' Deborah Elms, the head of trade policy at Asia-based global trade research organization, the Hinrich Foundation, told the New York Times. 'Asian governments are being asked to redefine supply chains to something that might be decades in the making in exchange for what? It's a little unclear.'
Newsweek
6 minutes ago
- Newsweek
Is the Stock Market Open on Fourth of July? What to Know
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content. As Americans celebrate Independence Day with fireworks and parades, many businesses and services will alter their hours or close altogether for the Fourth of July. Is the Stock Market Closed Today? As is standard practice, U.S. stock markets will be closed on Friday in observance of Independence Day. The New York Stock Exchange and Nasdaq closed early on Thursday and will remain closed on Friday. Investors should also note that the U.S. bond market closed early on Thursday and will remain closed on July 4, per the Securities Industry and Financial Markets Association. After returning to normal hours Monday, Wall Street's schedule will remain unchanged until September, when markets close for Labor Day. What Else Will Be Closed on the Fourth of July? Most federal, state, and local government offices will remain closed for the holiday. This includes post offices, so regular mail delivery USPS will be paused, and priority mail will be the only service in operation. FedEx and UPS will also suspend their delivery services, although some urgent shipments—through FedEx Custom Critical and UPS Express Critical—will still be available. UPS and FedEx office locations will be closed or have modified hours, and customers are encouraged to check with their local branches regarding availability. Wall Street sign hangs next to the New York Stock Exchange on Monday, June 30, 2025, in New York. Wall Street sign hangs next to the New York Stock Exchange on Monday, June 30, 2025, in New York. Yuki Iwamura/AP Photo Banks including Bank of America, Wells Fargo and Capital One will be closed as well, though ATMs and digital banking will remain in service. Public libraries, courts, as well as many city and town offices will also shut their doors for the holiday. Will Shops Stay Open? Many retailers and grocery stores will remain open on the Fourth of July, though some may operate on different hours. Major retailers, stores and restaurant chains including Walmart, Starbucks and McDonald's confirmed to USA Today that they will still be serving customers during the holiday. Target, Home Depot and Lowe's also confirmed that they would be operating at regular hours on Friday. However, Costco has announced on its website that all of its warehouse locations will be closed for the Fourth of July. CVS will remain open, though some locations will operate on holiday schedules. Most Walgreens locations are expected to stay open as usual, though operating hours may vary by location. What Happens Next To mark the 250th anniversary of the country's founding next year, President Donald Trump has already kicked off a yearlong series of celebrations with a parade in Iowa. Earlier this year, the president created a specialized "Task Force" to "to plan, organize, and execute" the celebrations that will mark the occasion.
USA Today
15 minutes ago
- USA Today
Republicans passed the 'big, beautiful bill.' Will it come back to haunt them?
Congress passing President Trump's sweeping tax policy bill will have massive consequences for both parties in the 2026 midterm elections. WASHINGTON – President Donald Trump's legislative package of tax reductions and Medicaid cuts passed out of Congress on July 3 and will soon be signed into law. Up next for Congressional Republicans: Surviving the midterms. Many Republicans argue that voters will feel the economic benefits of their bill and reward them by sending them back to Washington. Democrats say the bill is deeply unpopular and they'll use it to clobber the GOP in the November 2026 election. History, in this case, favors the Democrats' argument. The party that does not hold the White House typically wins the House in the midterm elections as voters express frustrations with the new president's policies. This trend applies regardless of party in modern history, with some exceptions. And public polling about the Republican bill already indicates voters aren't thrilled about it. A Fox News poll published in mid-June found 38% of respondents favored the legislation and 59% opposed it. Polls from Quinnipiac, The Washington Post, KFF and Pew reflected similar sentiments. "This will cost Republicans the House," said Rep. Suzan DelBene, D-Washington, chair of the Democratic Congressional Campaign Committee, which is responsible for helping Democrats keep and win House seats. Democrats have their 'script' for 2026 The bill's Medicaid cuts are expected to leave 11.8 million Americans without insurance over the next ten years – a deeply "damaging" result that will drive up healthcare costs for families, DelBene said. Democrats have likened this bill to Republicans' 2017 attempt to repeal the Affordable Care Act, after which Republicans lost 40 seats in the House. "People want representatives that are going to stand up for them," she argued, "and this bill is an example of Republicans turning away from their constituents." Republicans have "written the script" for 2026, said Rep. Jamie Raskin, D-Maryland. 'I'm certainly going to be talking about it all of the time,' he told USA TODAY. 'I mean, nothing could better capture the way that the Republican party just serves Donald Trump and our would-be monarchs and oligarchs.' It's not just Democrats who have identified the Medicaid cuts as a potential political threat. During a meeting with House Republicans on July 2, as GOP leadership scrambled to find the votes for the package, Trump said they shouldn't touch three things if they wanted to win elections – Medicaid, Medicare and Social Security, according to the news site NOTUS. One member reportedly responded: "But we're touching Medicaid in this bill." Campaigning after Medicaid cuts Rep. Don Bacon, R-Nebraska, represents a swing district and recently announced he plans to retire from Congress. He has been a vocal opponent of the Medicaid cuts in the bill, but he said before the vote that he would approve the measure because it would save the average Nebraskan $141 per month in taxes and pour billions into the defense budget. Bacon said he believes the Senate's version, which implemented deeper cuts to Medicaid, makes it easier for Democrats to paint the package in a negative light during the midterm elections. "I could have defended the House bill every day. It was easy," he said. "But in the end, do I want to raise taxes on the middle class? No. Do I want to fix defense? Yes." Some Republicans are confident they can explain their reasoning to voters, including those who raised concerns about Medicaid cuts. Rep. Jeff Van Drew, R-New Jersey, argued before the vote that his concerns were allayed by provisions in the bill that would allow hospitals in his district to continue to draw down sufficient federal funds. "I've said all along that we have to do this in an intelligent way. I believe that it seems we've charted a way to do that. Where we started a few months ago, people were saying we're going to gut Medicaid. We're a long ways off from that." GOP confident tax breaks will carry them House Majority Leader Steve Scalise, R-Louisiana, said he believed the bill would prop up Republicans in the 2026 midterm elections. "Every Democrat (in the) House and Senate voted no," Scalise said on July 3. "The American people are going to see great benefits from this bill, and they're going to know which party was fighting for them and which party was literally trying to hold up the vote for hours so that those families couldn't get that relief." "The Democratic Party still doesn't know why they lost in November. They're going to be reminded of that next year when they lose again," he added. The bill makes permanent the 2017 income tax cuts implemented during Trump's first term and pours $170 billion in border security funding. In a memo on the bill, the National Republican Congressional Committee indicated it plans to argue Republicans prevented "the largest tax hike in generations" and delivered a historic funding boost for border security. 'This vote cemented House Democrats' image as elitist, disconnected, snobby, unconcerned with the problems Americans face in their daily lives, and most of all – out of touch," Mike Marinella, NRCC spokesman, said in a statement. "House Republicans will be relentless in making this vote the defining issue of 2026, and we will use every tool to show voters that Republicans stood with them while House Democrats sold them out.'
