Due to its banking partnership, dollars kept on Gemini will be eligible for FDIC (Federal Deposit Insurance Corporation) insurance and are as "safe and secure as they are in your bank account today", the exchange claims."
Hmm... FDIC only insures bank deposits against
bank failures, isn't that so?
If the clients' dollar deposits are stored in a single bank account, in the name of Gemini (as most exchanges do), the FDIC will not insure the clients against Genesis screwing it up (as MtGOX did). Isn't that so?
https://www.fdic.gov/deposit/deposits/"FDIC insurance covers all deposit accounts, including:
Checking accounts
Savings accounts
Money market deposit accounts
Certificates of deposit
FDIC insurance does not cover other financial products and services that banks may offer, such as stocks, bonds, mutual funds, life insurance policies, annuities or securities.
The standard insurance amount is $250,000 per depositor, per insured bank, for each account ownership category."
As with traditional exchanges what they insure is the balance in USD and not the products.
This permits mom and pop to move 25k in RRSP 401k and other funding options.
This is huge.