Firelight Protocol Raises $8M to Protect DeFi from Smart Contract Exploits

Firelight Protocol, a decentralized finance (DeFi) protection layer incubated by Sentora, has raised $8 million in a seed round led by Gumi Cryptos Capital. This funding will support the development of an on-chain protection layer for DeFi and expand its XRP-backed cover system to include BTC, XLM, and other non-yielding assets.

The protocol aims to provide coverage for risks related to smart contract exploits through dedicated cover capital and a claims process designed to settle eligible losses within roughly 10 days. Firelight is targeting fintechs, neobanks, and payments companies that offer on-chain yield to their users, rather than crypto-native traders.

According to CEO Anthony DeMartino, the company plans to initially expand its collateral beyond XRP to include Bitcoin (BTC) and Stellar's XLM. Firelight is considering a broader universe of liquid, non-yielding assets that can be posted as collateral.