Firelight raises $8M to expand DeFi protection to Bitcoin and XLM
Firelight's funding round backs expansion of its DeFi loss-recovery network from XRP to Bitcoin and Stellar.
Firelight, a protocol focused on DeFi loss recovery, has raised $8 million in new funding. The startup plans to use the capital to expand its protection network beyond the XRP Ledger to include Bitcoin and Stellar.
The protocol is designed to give fintechs and institutional investors a faster way to recover losses from decentralized finance hacks. It does this by allowing holders of XRP, bitcoin, and XLM to earn yield in exchange for backing that protection.
How it works
Firelight connects users who want protection from DeFi exploits with liquidity providers who deposit digital assets. When a hack occurs, the protocol aims to speed up compensation compared to traditional insurance or legal routes.
The expansion means that bitcoin and Stellar’s XLM holders can now participate in the network, not just XRP holders. The move is intended to make the protocol more attractive to a wider range of fintech partners.
The funding round adds to a growing list of projects attempting to address the risk of hacks in decentralized finance, which has become a major concern for institutions entering the space.