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Given that this tweet (https://twitter.com/Brett_FTX/status/1552339740397109248 https://twitter.com/Brett_FTX/status/1552339740397109248) > brokerage accounts
by okwubodu 4y ago
Given that this tweet
(https://twitter.com/Brett_FTX/status/1552339740397109248 https://twitter.com/Brett_FTX/status/1552339740397109248)
> brokerage accounts are SIPC-insured, cash associated with brokerage accounts is managed into FDIC-insured accounts at our partner bank
is still up, I imagine the imprecision of the statement is what the FDIC took issue with.
- adrr 4y agoBecause it's probably setup similarly to Voyager which is a single omnibus account and offers no protection of if the brokerage goes bankrupt.
- AlexandrB 4y agoDoes it even offer any realistic protection if the "partner bank" goes under? AFAIK the limit on FDIC insurance is $200k / account. Is FTX managing hundreds/thousands of account to get around this or is only $200k of their money FDIC insured?
- colechristensen 4y agoTo get FDIC insurance in a meaningful way it would have to be per-customer accounts created in specific ways. If they're not created in particular ways the funds in the third party bank accounts can be taken in bankruptcy actions by creditors and aren't actually protected customer funds and aren't insured at all accept with whatever level of insurance they have for the partner bank going under, but that is not the risk anybody is worried about.
- dpifke 4y agoThey are per-customer accounts. This is how they explain it when you enable the feature: https://pifke.org/ftxdd.png https://pifke.org/ftxdd.png