Firelight Raises $8 Million to Backstop DeFi Vaults With Staked XRP

Firelight, a cover protocol that uses staked XRP to protect DeFi vaults from exploits, announced an $8 million seed round led by Gumi Cryptos Capital. The funding will support the launch of its first cover integrations later this month.

Market Context

On‑chain cover remains a small fraction of total DeFi value. DefiLlama tracks roughly $123.7 million of capital across 27 insurance protocols protecting $88.3 billion of assets, or about 0.14 %. Nexus Mutual accounts for the majority of that capital.

Firelight’s Model

Firelight separates cover capital from the protocols it protects. Stakers deposit XRP, which is bridged to Flare as FXRP and receive the liquid staking token stXRP. The pooled stXRP serves as the backing pool for cover claims. Premiums paid by vaults and protocols fund the yield for stakers.

Capital and Assets

• Current staked XRP pool: $76 million (up 20 % over 30 days)
• Deposit cap: 65 million FXRP
• Largest protocol on Flare, which hosts $133 million across 39 protocols
• Future backing assets: Bitcoin (BTC) and Stellar (XLM)

Risk Management and Claims

Cover is not classified as insurance. In the event of a validated claim, a first‑loss buffer is slashed pro‑rata across all stakers. Claims are adjudicated by a consortium of five independent firms (GFX Labs, Hypernative, Credora, Native, Cyfrin), separating assessment from the capital pool.

Covered events include smart‑contract exploits, reentrancy failures, oracle manipulation, governance attacks, and bad debt. Pricing adjusts in real time based on risk components.

Audits and Security

Firelight has undergone audits by OpenZeppelin and Coinspect and runs a bug bounty program through Immunefi.

Launch Timeline

Initial cover for Sentora’s public and private vaults was slated for Q2 2026 but has been moved to September 2026.

Team and Backers

Key participants in the seed round include Maven 11, Metalayer, Joint Effects, and Tribe Capital. Anthony DeMartino, former risk strategist at Coinbase, serves as CEO of both Sentora and Firelight. Jesus Rodriguez, co‑founder of Sentora, is Firelight’s CTO, and Connor Sullivan joins as Chief Strategy Officer from Fireblocks.