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In theory FDIC only covers the $250k but in recent years these bank wrappers have gotten a little bit more clever and abstracted it away by distributing holding

In theory FDIC only covers the $250k but in recent years these bank wrappers have gotten a little bit more clever and abstracted it away by distributing holdings across multiple partner bank accounts: https://www.getevolved.com/openbanking/fdic-insured-sweep-program/fdic-mercury/ https://www.getevolved.com/openbanking/fdic-insured-sweep-pr... Mercury is the provider I know who does this (in partnership with Evolve, as the link indicates) but I think there are others as well.

hodgesrm 2y ago
Brex does it as well. At one point last year during the SVB meltdown they claimed to be doing sweeps across 9 Partner Banks. It sounds good but I find the disclosure pretty opaque. [0] We keep our funds diversified in several banks at this point to be sure. https://www.brex.com/legal/brex-cash-sweep-disclosure https://www.brex.com/legal/brex-cash-sweep-disclosure