In a post published on its website today, Binance US announced that customer USD deposits are now eligible for Federal Deposit Insurance Corporation (FDIC) coverage. According to the announcement, all customer dollar deposits are kept in “pooled custodial accounts” maintained at a number of FDIC-insured banks:
The pooled custodial accounts are maintained in a manner that provides access to pass-through FDIC insurance coverage up to the depositor coverage limit, which is currently $250,000. FDIC insurance coverage protects depositors against the risk of loss in the event that an FDIC-insured bank fails.
The Federal Deposit Insurance Corporation is an independent agency created by the 1933 Banking Act, as part of Depression-era effort to restore Americans’ trust in their financial system. Prior to its creation, the U.S. had experienced a rash of bank runs and closings, with more than a third of the nation’s banks being forced to close after panic-inspired depositor withdrawals.