The only reason there’s risk on uninsured deposits is because banks are allowed to place their own bets with the money in exchange for holding it.
This is called a Narrow Bank. [0] The Fed doesn't want it though, because such a bank would not participate in the money creation process, or help the Fed disseminate its monetary policy, which all banks implicitly do.
Alternatively...
> You could imagine a federal institution for this, or simply a regulatory program that required banks to offer such an account.
This is called a CBDC. [1] It may one day happen.
[0] https://www.bloomberg.com/opinion/articles/2019-03-08/the-fe...
[1] https://www.federalreserve.gov/central-bank-digital-currency...
If you're large enough to have your own bank - many car manufacturers are, IIRC also IKEA - and are in Europe, you can already do this and deposit money at the ECB. In fact, so many were interested in that service that it turned from the usual - banks get paid interest, but a low rate - to the negative as a consequence of all the QE money injected after 2008ff.
If you're not large enough, park your money into a time spread of government bonds - the US and Germany are among the safest harbors you can get. Spread your yearly cash burn over 5-10 different banks, buy 1 year bonds and roll them over with the rest.
That’s almost what SVB did, but they got hit by an “unexpected cash burn”. 1 year government bonds may be at low risk of default but there’s a high risk of interest rates and market conditions changing in that time. If you suddenly need the money in 6 months and interest rates have changed, you’ve lost money. You’d need to buy monthly bills to be truly safe and then have the cost of rolling them over every month. Ironically SVB offers a product that can help you do that:
https://www.svb.com/liquidity-management/deposits-and-invest...
Didn't ordinary banks offer negative interest rates too? Or was it just the ECB?
I think this is called a US government short-term bond, and they'll pay you.
I understand it pays respectable interest rates too
https://en.wikipedia.org/wiki/Certificate_of_Deposit_Account...