IMO banks should be doing this anyway (insure deposits). I think most time founders are so engrossed in product-market fit and growth that finance is after thought. You're provided an "army" with VC cash and you are expected to be own an entire category with that army. It seems rational to me that most people would be thinking strategy and future attack plans rather than the extremely rare chance that the whole army itself gets kidnapped.

Ideally we as a society, should be able to offer people peace of mind to deposit large sums of money and not worry about it being lost. Expecting everyone to perform financial gymnastics just to keep their money feels like a complete waste of resources.

Maybe the solution is to create a tier A bank that gives you no returns, charges you a flat fee, and any amount of money deposited is guaranteed. I know people do that with treasuries, but thats a lot of extra steps to put money in and out.

Keep in mind, tiny teams with no "finance person" easily receive more than 1M as part of seed or series A. Very rarely is their first hire for managing that money. Should it be? Is it worth it? Or should you rely on the financial system and regulation protecting your own money.

Well you can do that in cash or crypto. But you still want to the banks protection, right?

You could go down and withdraw your 20mil dollars and put them in your couch. But you kind of like that the bank takes care of security for you.

But you don't want to pay for that insurance?

When you start a company, you already insure tonnes of things. You employees, etc. Why not your financial position.

Do you also expect the society to take care of your liability insurance? or health insurance?

(It is actually laughable, that Americans think that the government should insure their deposits but not their health)

I think you're strawmanning here. I'm not against deposit insurance. I merely suggested it should actually be part of the banking regulation.

Like maybe it's a default line item monthly fee to insure your deposits and you can choose to opt out of it. The default is to protect your funds. My guess is very few people will opt out, including me.

It is a part of the regulation, up to USD 250k, which appears to be a good limit for people who should be aware of doing stuff like this themselves (in EU it is EUR 100k, so the US more than doubles that amount).

I think this just shows the irresponsibleness of people with large deposits.