BlockBeats News, September 1st, DeFi protocol Firelight Protocol announced the completion of an $8 million financing round, led by Gumi Cryptos Capital, with participation from Maven 11, Metalayer, Joint Effects, and Tribe Capital.

The project aims to build an on-chain risk protection layer for DeFi, with plans to launch the protocol and the first batch of protection products in September. It will expand the coverage of protected assets from XRP to Bitcoin (BTC) and Stellar (XLM).

Firelight, incubated by DeFi infrastructure provider Sentora, focuses on the smart contract vulnerability risks faced by fintech companies entering the on-chain yield market. It has designed an on-chain protection mechanism, where users' protected positions will be represented as NFTs. In the event of an exploit, an alliance composed of independent risk assessors such as GFX Labs, Hypernative, Credora, Native, and Cyfrin will evaluate the eligibility for compensation. The goal is to complete the assessment in 3 to 4 days and the compensation within 10 days.

Firelight CEO Anthony DeMartino stated that the product is not aimed at crypto-native speculators but rather aims to be the "protection layer" driving the next wave of funds into DeFi. Currently, DeFi has around $800 billion in total value locked, but less than 1% is covered by on-chain risk protection. Firelight believes that fintech companies, neobanks, and payment platforms will be its main potential clients.