A group of Silicon Valley billionaires, led by Peter Thiel, has submitted an application to U.S. regulators to create a national bank named 'Lonely Mountain' targeting cryptocurrency companies.
Strategic Development of the Bank
On July 2, the Financial Times reported that a group of Silicon Valley billionaires is applying for a national banking license to establish a financial institution named 'Lonely Mountain.' The bank aims to support cryptocurrency companies and fill the financing gap created after the collapse of Silicon Valley Bank in 2023.
Main investors include Peter Thiel and other Republican-backed tech giants. The bank's target clients are startups in cryptocurrency, artificial intelligence, defense, and manufacturing sectors.
Business Models and Advantages
'Lonely Mountain' will utilize an innovative architecture that offers both traditional banking products and crypto-specific services. This allows addressing issues of limited fiat channels and inefficient transaction processes for crypto companies.
Involvement of Peter Thiel and other investors may accelerate regulatory approval processes through their influence in relaxing crypto policies.
Regulatory Battles and Industry Impact
Current disputes focus on three key aspects:
1. License Approval: The Office of the Comptroller of the Currency (OCC) must evaluate their anti-money laundering framework.
2. Counteraction from Traditional Financial Institutions, as they have expressed intentions to review whether the bank circumvents securities regulations.
3. Potential redirection of over 80% of institutional customer custody business away from exchanges like Coinbase, which may lead to significant market changes.
'Lonely Mountain' represents a significant shift in Silicon Valley's approach to financial services, opening the door for specialized banks for cryptocurrency companies. The bank's success will largely depend on regulatory approval and its ability to effectively manage compliance requirements.
