$8M Funding Secured for On-Chain Protection Layer in DeFi

Firelight Protocol has secured $8 million in funding to develop an on-chain protection layer for decentralized finance (DeFi). The investment round was led by Gumi Cryptos Capital, with other participants including Maven 11, Metalayer, Joint Effects, and Tribe Capital. This move aims to provide a safety net for DeFi users, which has become increasingly important as more mainstream financial firms experiment with on-chain yield products.

The problem of smart-contract exploits wiping out customer funds is a pressing issue in the DeFi space. Firelight's solution involves dedicated cover capital and a claims process designed to settle eligible losses within 10 days. This is in contrast to traditional insurance, which can take months to pay out.

Firelight CEO Anthony DeMartino notes that the project is not built for crypto-native traders, but rather to bring in mainstream capital. He expects more money currently sitting in bank accounts to migrate into fintech earn products powered by stablecoins and on-chain vaults.