Firelight Protocol Raises $8M to Expand DeFi Protection Beyond XRP - tokenpost.com

Firelight Protocol has secured $8 million in funding to build an onchain protection layer for decentralized finance, aiming to expand its collateral system beyond XRP to include Bitcoin, Stellar, and other liquid assets. The round was led by Gumi Cryptos Capital with participation from Maven 11, Metalayer, Joint Effects, and Tribe Capital. The project, incubated by Sentora, plans to launch its protocol and initial cover integrations in September. Firelight addresses the significant risk of smart-contract exploits, which have resulted in over $9 billion stolen from DeFi protocols. The company intends to combine dedicated cover capital with a faster claims process, targeting payouts within 10 days. CEO Anthony DeMartino noted the protocol could eventually accept a wider range of assets, particularly those with strong liquidity that do not naturally generate yield. Firelight targets fintech companies, neobanks, and payment providers integrating stablecoin and DeFi yield products. The protocol represents covered positions with NFTs, which can be submitted for assessment by a consortium of independent risk firms, including GFX Labs, Hypernative, Credora, Native, and Cyfrin. The consortium determines if an exploit occurred and if it qualifies under cover terms, with a target assessment period of three to four days. Firelight expects traditional bank capital to move toward onchain financial products, increasing demand for protection. With roughly $80 billion locked across DeFi and only a small percentage protected by onchain cover, Firelight sees significant room for growth. The capital will support protocol development, additional protection products, and ecosystem partnerships.