After the SVB debacle I was thinking that a bank should offer an account that has sub accounts at other banks, all under $250k, to maintain full FDIC coverage for the entire balance. Turns out it exists. It's called Intrafi and it is supported by many banks, including First Republic, which is a popular bank in Silicon Valley.
That's exactly what wealthfront does .. over a dozen banks? 4.05% APY and up to $2 million in FDIC insurance.
Almost every brokerage does that
What if IntraFi goes bankrupt, do you think you will get your deposit back? FDIC only protects against underlying bank failure not a wrapper on top of banks.
Before commenting, recommend you read about how IntraFi works.
Do you know how much it takes to run a business? 250k limit is stupid for business accounts
Not sure if you're criticizing me or the FDIC, but that's the point of Intrafi. You can get, say, $2M of insurance via 8 sub accounts.
@Bankruns are you being willfully ignorant here? There have been tools/systems for decades that have insured far more than 250k with no manual management on behalf of a business necessary. OP posted about one of those.
But if you ask VCs and their founders: this product never existed and they were forced to keep 97% of funds uninsured.