Firelight, a protocol built to help fintechs and investors recover losses from DeFi hacks, has raised $8 million in funding. The money will fund an expansion beyond its original XRP focus, adding coverage for other assets. The goal, the team says, is to make DeFi less intimidating for traditional financial firms.
Beyond XRP
Firelight started with XRP, but that's changing. The protocol now plans to support a wider range of assets, though the specifics of which ones haven't been detailed. What is clear is that the protection mechanism is backed by yield from XRP, bitcoin, and XLM holders. Those users earn a return for backing the pool that pays out when a hack occurs.
How the protection works
The core pitch is speed. When a DeFi protocol gets exploited, victims often wait months for recovery — if they get anything at all. Firelight aims to shorten that timeline, giving fintechs and investors a faster path to recouping losses. The funding round should help scale that infrastructure.
Courting fintechs
The broader ambition is to lower the barrier for fintechs eyeing DeFi. The space has a reputation for being risky and hard to navigate. Firelight's expansion is a bet that better protection tools will bring more institutional money in. The $8 million raise is a signal that investors see a market for that.
