Firelight Finance has launched a new XRP staking protocol on the Flare network, giving XRP holders a fresh way to earn yield.
The protocol introduces stXRP, a liquid token designed to generate rewards through a DeFi insurance model aimed at protecting protocols against hacks and operational failures.
The rollout begins with Phase 1, which allows users to bridge XRP to Flare using the FAssets system. Users deposit FXRP into Firelight and receive stXRP on a one-to-one basis. While the token is already usable across the Flare ecosystem on decentralized exchanges, lending platforms, and liquidity pools, staking rewards are not active yet.
Rewards are expected to begin in Phase 2, targeted for early 2026, once DeFi protocols start adopting Firelight’s insurance model and paying fees for coverage. Chief Strategy Officer Connor Sullivan, formerly at Fireblocks, said the design borrows from restaking concepts but intentionally avoids the pitfalls seen in early Ethereum-based models like EigenLayer.
According to Sullivan, the biggest issue with early restaking frameworks was the cost of capital. Firelight takes a different approach by focusing on assets with structurally lower capital costs, narrowing its scope to DeFi insurance for top-tier protocols, and aligning incentives through short, transparent points programs tied to real participation and economic value.
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Early participants in the initial vault will earn Firelight Points, which are designed to reward engagement ahead of the full rewards launch. The long-term vision is twofold. Give XRP holders access to staking rewards, and provide DeFi protocols with a dedicated insurance layer that actually fits institutional risk standards.
Firelight is incubated by Sentora, a firm formed through the merger of IntoTheBlock and Trident Digital, and is supported by the Flare network. Both organizations are backed by Ripple and are working to expand XRP’s role across decentralized finance.
Sullivan noted that Sentora has supported billions of dollars in total value locked through risk management and liquidity programs for major DeFi protocols. Many of its institutional clients want yield exposure but hesitate due to the lack of robust insurance primitives. In his view, this type of cover is no longer optional. It is a core requirement.
Firelight is already in discussions with several DeFi protocols about integrating its cover system. Protocols that opt in will pay fees for protection backed by pooled FXRP, with a portion of those fees distributed to XRP stakers as rewards. While the system runs on Flare, it is chain-agnostic, allowing protocols on any blockchain to purchase coverage.
If a covered incident occurs, claims will be submitted by an appointed agent and reviewed by an independent consortium. Approved payouts are executed automatically through on-chain contracts, creating a transparent and enforceable insurance process for decentralized finance.
