[bluquark]

Robinhood is a SIPC member. It rarely comes into play, but my understanding is that SIPC is there to ensure securities get back to their rightful owner in the event that something weird happens to the brokerage.

[cma]

They are only covered up to $5 billion for the entire brokerage industry, it may be like 2008 and they all get turned into FDIC insured banks over night if tons of margin accounts fail.

[ummonk]

Yeah we'd be looking at losses much bigger than that if the short-sellers go under due to a squeeze.

[jjeaff]

And a max of $100k per account.

[swarnie_]

The issue is when?

If that takes several weeks or months in a highly volatile market its basically life or doing a flip.